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AN ACT relating to consumer protections in health insurance. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
SECTION 1. A NEW SECTION OF SUBTITLE 17A OF KRS CHAPTER 304 3
IS CREATED TO READ AS FOLLOWS: 4
(1) For purposes of this section: 5
(a) "Essential health benefits" means, with respect to any health benefit plan, 6
coverage that provides the benefits that are determined by the commissioner 7
in accordance with subsection (3) of this section; 8
(b) "Pre-existing condition exclusion": 9
1. Means a limitation or exclusion of benefits, including a denial of 10
coverage, based on the fact that a condition was present before the 11
effective date of coverage, or if coverage is denied, the date of denial, 12
whether or not any medical advice, diagnosis, care, or treatment was 13
recommended or received before that day; and 14
2. Includes any limitation or exclusion of benefits applicable to an 15
individual as a result of information relating to an individual's health 16
status before the individual's effective date of coverage, or if coverage 17
is denied, the date of denial; and 18
(c) "Reviser of statutes" means the person appointed under KRS 7.140. 19
(2) (a) An insurer that offers health benefit plan coverage in any market, including 20
the small group, large group, association, employer-organized association, 21
or individual market, shall: 22
1. Not establish rules for eligibility, including continued eligibility, of 23
any individual to enroll under the terms of the plan based on any of 24
the following health status-related factors in relation to the individual 25
or a dependent of the individual: 26
a. Health status; 27 UNOFFICIAL COPY 22 RS BR 99
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b. Medical condition, including both physical and mental illness; 1
c. Claims experience; 2
d. Receipt of health care; 3
e. Medical history; 4
f. Genetic information; 5
g. Evidence of insurability, including conditions arising out of acts 6
of domestic violence; 7
h. Disability; 8
i. Sex and gender; or 9
j. Any other health status-related factor that is determined 10
appropriate by the commissioner; 11
2. Not require any individual, as a condition of enrollment or continued 12
enrollment under the plan, to pay a premium or contribution which is 13
greater than the premium or contribution, or be subject to benefits 14
coverage that is different than the benefits coverage, for a similarly 15
situated individual enrolled in the plan on the basis of any health 16
status-related factor identified in subparagraph 1. of this paragraph in 17
relation to the individual or a dependent of the individual; 18
3. Not impose any pre-existing condition exclusion with respect to such 19
plan or coverage; 20
4. Provide coverage for essential health benefits with respect to such 21
plan or coverage; 22
5. Not establish lifetime or annual limits on the dollar value of essential 23
health benefits for any insured covered under the plan; and 24
6. For plans that provide dependent coverage of children, continue to 25
make such coverage available for an adult child until the child turns 26
twenty-six (26) years of age. 27 UNOFFICIAL COPY 22 RS BR 99
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(b) An insurer that offers group health benefit plan coverage shall not adjust 1
premium or contribution amounts for the group covered under the plan on 2
the basis of genetic information. 3
(3) (a) The commissioner, by administrative regulation, shall define essential 4
health benefits. 5
(b) Essential health benefits shall include at least the following general 6
categories and the items and services covered within the categories: 7
1. Ambulatory patient services; 8
2. Emergency services; 9
3. Hospitalization; 10
4. Maternity and newborn care; 11
5. Mental health and substance use disorder services, including 12
behavioral health treatment; 13
6. Prescription drugs; 14
7. Rehabilitative and habilitative services and devices; 15
8. Laboratory services; 16
9. Preventive and wellness services and chronic disease management; 17
and 18
10. Pediatric services, including oral and vision care. 19
(c) In defining essential health benefits under this subsection, the 20
commissioner shall ensure that the benefits are at least as comprehensive as 21
the benefits required of plans subject to the essential health benefits 22
requirements of the Patient Protection and Affordable Care Act, Pub. L. No. 23
111-148, as amended by the Health Care and Education Reconciliation Act 24
of 2010, Pub. L. No. 111-152, as in effect on January 1, 2021, and any 25
federal rules and regulations adopted thereunder, as in effect on January 1, 26
2021. 27 UNOFFICIAL COPY 22 RS BR 99
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(4) In the case of a conflict between this section and any other law, this section shall 1
control unless application of this section results in a reduction in coverage for 2
any insured. 3
(5) (a) Any health plan or health plan sponsor not otherwise required to comply 4
with this section may elect to comply with the provisions of this section. 5
(b) A health plan or health plan sponsor making an election under this 6
subsection shall provide written notice to the commissioner, in the form and 7
manner prescribed by the commissioner. 8
(6) (a) For purposes of subsection (7) of this section, the date of applicability shall 9
be the date determined under paragraph (c) of this subsection. 10
(b) If any of the following laws, as in effect on January 1, 2021, are repealed, 11
amended so as to result in a reduction in consumer protections or coverage, 12
or ruled by a court of competent jurisdiction to be no longer enforceable in 13
Kentucky, the commissioner shall, within thirty (30) days of the first event 14
to occur, deliver written notification of that event and the effective date of 15
the event to the reviser of statutes: 16
1. 42 U.S.C. sec. 300gg-4, relating to: 17
a. Eligibility rules based on health status-related factors; 18
b. Premiums or contributions on the basis of any health status-19
related factor; or 20
c. The adjustment of insurance premium or contribution amounts 21
for groups on the basis of genetic information; 22
2. 42 U.S.C. sec. 300gg-3, and any provision of 42 U.S.C. secs. 300gg to 23
300gg-63, 42 U.S.C. sec. 300gg-91, 42 U.S.C. sec. 300gg-92, or 42 24
U.S.C. sec. 18011, relating to pre-existing condition exclusions; 25
3. 42 U.S.C. sec. 300gg-11, relating to lifetime and annual limits on the 26
dollar value of benefits; 27 UNOFFICIAL COPY 22 RS BR 99
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4. 42 U.S.C. sec. 300gg-14, relating to dependent coverage; or 1
5. 42 U.S.C. sec. 18022, relating to essential health benefit requirements. 2
(c) The date of applicability shall be ten (10) days after the notification under 3
paragraph (b) of this subsection is received by the reviser of statutes, who 4
shall, on or before the date of applicability, note the date of receipt of such 5
notification in the official, electronic, and certified versions of the Kentucky 6
Revised Statutes. 7
(d) For purposes of paragraph (b) of this subsection, the effective date of the 8
event shall be as follows: 9
1. The effective date of any repeal or amendment shall be the effective 10
date of the repealing or amending legislation; and 11
2. The effective date of any court ruling shall be the date upon which all 12
appeals of that ruling have been exhausted or the time for appeal has 13
elapsed. 14
(7) This section shall apply to: 15
(a) All health benefit plans issued or renewed on or after the date determined 16
under subsection (6)(c) of this section; and 17
(b) Any health plans or health plan sponsors that elect, pursuant to subsection 18
(5) of this section, to comply with the provisions of this section on or after 19
the date determined under subsection (6)(c) of this section. 20
(8) The commissioner shall promulgate administrative regulations necessary to carry 21
out the provisions of this section. 22
Section 2. KRS 304.17A-096 is amended to read as follows: 23
(1) An insurer authorized to engage in the business of insurance in the Commonwealth 24
of Kentucky may offer one (1) or more basic health benefit plans in the individual, 25
small group, and employer-organized association markets. A basic health benefit 26
plan shall cover physician, pharmacy, home health, preventive, emergency, and 27 UNOFFICIAL COPY 22 RS BR 99
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inpatient and outpatient hospital services in accordance with the requirements of 1
this subtitle. If vision or eye services are offered, these services may be provided by 2
an ophthalmologist or optometrist. 3
(2) An insurer that offers a basic health benefit plan shall be required to offer health 4
benefit plans as defined in KRS 304.17A-005[(22)]. 5
(3) An insurer in the individual, small group, or employer-organized association 6
markets that offers a basic health benefit plan may offer a basic health benefit plan 7
that excludes from coverage any state-mandated health insurance benefit, except 8
that the basic health benefit plan shall include coverage for diabetes as provided in 9
KRS 304.17A-148, hospice as provided in KRS 304.17A-250(6), chiropractic 10
benefits as provided in KRS 304.17A-171, mammograms as provided in KRS 11
304.17A-133, and those mandated benefits specified under federal law. 12
(4) Notwithstanding any other provisions of this section, mandated benefits excluded 13
from coverage shall not be deemed to include the payment, indemnity, or 14
reimbursement of specified health care providers for specific health care services. 15
(5) The provisions of this section shall be subject to Section 1 of this Act. 16
Section 3. KRS 304.17A-097 is amended to read as follows: 17
An insurer that offers a basic health benefit plan shall disclose to all individuals, small 18
employer groups and employer-organized associations prior to the issuance of a policy 19
that the basic health benefit plan: 20
(1) Provides limited coverage; 21
(2) Includes federally mandated benefits; and 22
(3) Excludes state-mandated benefits, except for: 23
(a) Diabetes benefits as provided in KRS 304.17A-148;[,] 24
(b) Hospice benefits as provided in KRS 304.17A-250(6);[, and] 25
(c) Chiropractic benefits as provided in KRS 304.17A-171; and 26
(d) Those benefits required under Section 1 of this Act. 27 UNOFFICIAL COPY 22 RS BR 99
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Section 4. KRS 304.17A-200 is amended to read as follows: 1
(1) An insurer that offers health benefit plan coverage in the small group, large group, 2
or association market may not establish rules for eligibility of any individual to 3
enroll under the terms of the plan based on any of the following health status-related 4
factors in relation to the individual or the dependent of the individual: 5
(a) Health status; 6
(b) Medical condition, including both physical and mental illness; 7
(c) Claims experience; 8
(d) Receipt of health care; 9
(e) Medical history; 10
(f) Genetic information; 11
(g) Evidence of insurability, including conditions arising out of acts of domestic 12
violence; and 13
(h) Disability. 14
(2) An insurer that offers health benefit plan coverage in the small group, large group, 15
or association market shall not require any individual to pay a premium or 16
contribution which is greater than the premium or contribution for a similarly 17
situated individual enrolled in the plan on the basis of any health status-related 18
factor in relation to the individual or a dependent of the individual. Nothing in this 19
subsection shall prevent the insurer from establishing premium discounts or rebates 20
or modifying otherwise applicable copayments or deductibles in return for 21
adherence to programs of health promotion and disease prevention. 22
(3) Subject to subsections (4) to (7) of this section, each insurer that offers health 23
benefit plan coverage in the small groups market shall accept every small employer 24
that applies for coverage and shall accept for enrollment under this coverage every 25
individual eligible for the coverage who applies for enrollment during the period in 26
which the individual first becomes eligible to enroll under the terms of the group 27 UNOFFICIAL COPY 22 RS BR 99
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health benefit plan. 1
(a) Notwithstanding any other provision of this subsection, the insurer may 2
establish group participation rules requiring a minimum number of 3
participants or beneficiaries that must be enrolled in relation to a specified 4
percentage or number of those eligible for enrollment. 5
(b) The terms and participation rules of the group health benefit plan shall be 6
uniformly applicable to small employers in the small group market. 7
(c) This subsection shall not apply to health benefit plan coverage offered by an 8
insurer if the coverage is made available in the small group market only 9
through one (1) or more bona fide associations. 10
(4) In the case of an insurer that offers health benefit plan coverage in the small group 11
market through a network plan, the insurer may: 12
(a) Limit the employers that may apply for coverage to those with individuals 13
who live, work, or reside in the service area of the network plan; and 14
(b) Within the service area of the network plan, deny coverage to employers if the 15
insurer has demonstrated to the commissioner that: 16
1. The network plan will not have the capacity to deliver services 17
adequately to enrollees of any additional groups because of its 18
obligations to existing group contract holders and enrollees; and 19
2. The insurer is applying this denial uniformly to all employers. 20
(5) An insurer, upon denying health benefit plan coverage in any service area in 21
accordance with subsection (4) of this section, shall not offer coverage in the small 22
group market within the service area for a period of one hundred eighty (180) days 23
after the date the coverage is denied. 24
(6) An insurer may deny health benefit plan coverage in the small group market if the 25
insurer has demonstrated to the commissioner that: 26
(a) The insurer does not have the financial reserves necessary to underwrite 27 UNOFFICIAL COPY 22 RS BR 99
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additional coverage; and 1
(b) The insurer is applying this denial uniformly to all employers in the small 2
group market. 3
(7) An insurer, upon denying health benefit plan coverage in connection with group 4
health plans in accordance with subsection (6) of this section, shall not offer 5
coverage in the small group market for a period of one hundred eighty (180) days 6
after the date the coverage is denied or until the insurer has demonstrated to the 7
commissioner that the insurer has sufficient financial reserves to underwrite 8
additional coverage, whichever is later. 9
(8) A health benefit plan issued as an individual policy to individual employees or their 10
dependents through or with the permission of a small employer shall be issued on a 11
guaranteed-issue basis to all full-time employees and shall comply with the pre-12
existing condition provisions of KRS 304.17A-220. 13
(9) (a) In connection with the offering of any health benefit plan to a small employer, 14
an insurer: 15
1. Shall make a reasonable disclosure to a small employer, as part of its 16
solicitation and sales materials, of the availability of information 17
described in paragraph (b) of this subsection; and 18
2. Upon request of a small employer, provide the information described in 19
paragraph (b) of this subsection. 20
(b) Subject to paragraph (c) of this subsection, with respect to an insurer offering 21
a health benefit plan to a small employer, information described in this 22
subsection is information concerning: 23
1. The provisions of the coverage concerning the insurer's right to change 24
premium rates and the factors that may affect changes in premium rates; 25
2. The provisions of the health benefit plan relating to renewability of 26
coverage; 27 UNOFFICIAL COPY 22 RS BR 99
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3. The provisions of the health benefit plan relating to any preexisting 1
condition exclusion; and 2
4. The benefits and premiums available under all health benefit plans for 3
which the small employer is qualified. 4
(c) Information described in paragraph (b) of this subsection shall be provided to 5
a small employer in a manner determined to be understandable by the average 6
small employer and shall be sufficient to reasonably inform a small employer 7
of his or her rights and obligations under the health benefit plan. 8
(d) An insurer is not required under this section to disclose any information that is 9
proprietary and trade secret information under applicable law. 10
(10) The provisions of this section shall be subject to Section 1 of this Act. 11
Section 5. KRS 304.17A-220 is amended to read as follows: 12
(1) Except as otherwise required under Section 1 of this Act, all group health plans 13
and insurers offering group health insurance coverage in the Commonwealth shall 14
comply with the provisions of this section. 15
(2) Subject to subsection (8) of this section, a group health plan, and a health insurance 16
insurer offering group health insurance coverage, may, with respect to a participant 17
or beneficiary, impose a pre-existing condition exclusion only if: 18
(a) The exclusion relates to a condition, whether physical or mental, regardless of 19
the cause of the condition, for which medical advice, diagnosis, care, or 20
treatment was recommended or received within the six (6) month period 21
ending on the enrollment date. For purposes of this paragraph: 22
1. Medical advice, diagnosis, care, or treatment is taken into account only 23
if it is recommended by, or received from, an individual licensed or 24
similarly authorized to provide such services under state law and 25
operating within the scope of practice authorized by state law; and 26
2. The six (6) month period ending on the enrollment date begins on the 27 UNOFFICIAL COPY 22 RS BR 99
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six (6) month anniversary date preceding the enrollment date; 1
(b) The exclusion extends for a period of not more than twelve (12) months, or 2
eighteen (18) months in the case of a late enrollee, after the enrollment date; 3
(c) 1. The period of any pre-existing condition exclusion that would otherwise 4
apply to an individual is reduced by the number of days of creditable 5
coverage the individual has as of the enrollment date, as counted under 6
subsection (3) of this section; and 7
2. Except for ineligible individuals who apply for coverage in the 8
individual market, the period of any pre-existing condition exclusion 9
that would otherwise apply to an individual may be reduced by the 10
number of days of creditable coverage the individual has as of the 11
effective date of coverage under the policy; and 12
(d) A written notice of the pre-existing condition exclusion is provided to 13
participants under the plan, and the insurer cannot impose a pre-existing 14
condition exclusion with respect to a participant or a dependent of the 15
participant until such notice is provided. 16
(3) In reducing the pre-existing condition exclusion period that applies to an individual, 17
the amount of creditable coverage is determined by counting all the days on which 18
the individual has one (1) or more types of creditable coverage. For purposes of 19
counting creditable coverage: 20
(a) If on a particular day the individual has creditable coverage from more than 21
one (1) source, all the creditable coverage on that day is counted as one (1) 22
day; 23
(b) Any days in a waiting period for coverage are not creditable coverage; 24
(c) Days of creditable coverage that occur before a significant break in coverage 25
are not required to be counted; and 26
(d) Days in a waiting period and days in an affiliation period are not taken into 27 UNOFFICIAL COPY 22 RS BR 99
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account in determining whether a significant break in coverage has occurred. 1
(4) An insurer may determine the amount of creditable coverage in another manner than 2
established in subsection (3) of this section that is at least as favorable to the 3
individual as the method established in subsection (3) of this section. 4
(5) If an insurer receives creditable coverage information, the insurer shall make a 5
determination regarding the amount of the individual's creditable coverage and the 6
length of any pre-existing exclusion period that remains. A written notice of the 7
length of the pre-existing condition exclusion period that remains after offsetting for 8
prior creditable coverage shall be issued by the insurer. An insurer may not impose 9
any limit on the amount of time that an individual has to present a certificate or 10
evidence of creditable coverage. 11
(6) For purposes of this section: 12
(a) "Pre-existing condition exclusion" means, with respect to coverage, a 13
limitation or exclusion of benefits relating to a condition based on the fact that 14
the condition was present before the effective date of coverage, whether or not 15
any medical advice, diagnosis, care, or treatment was recommended or 16
received before that day. A pre-existing condition exclusion includes any 17
exclusion applicable to an individual as a result of information relating to an 18
individual's health status before the individual's effective date of coverage 19
under a health benefit plan; 20
(b) "Enrollment date" means, with respect to an individual covered under a group 21
health plan or health insurance coverage, the first day of coverage or, if there 22
is a waiting period, the first day of the waiting period. If an individual 23
receiving benefits under a group health plan changes benefit packages, or if 24
the employer changes its group health insurer, the individual's enrollment date 25
does not change; 26
(c) "First day of coverage" means, in the case of an individual covered for 27 UNOFFICIAL COPY 22 RS BR 99
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benefits under a group health plan, the first day of coverage under the plan 1
and, in the case of an individual covered by health insurance coverage in the 2
individual market, the first day of coverage under the policy or contract; 3
(d) "Late enrollee" means an individual whose enrollment in a plan is a late 4
enrollment; 5
(e) "Late enrollment" means enrollment of an individual under a group health 6
plan other than: 7
1. On the earliest date on which coverage can become effective for the 8
individual under the terms of the plan; or 9
2. Through special enrollment; 10
(f) "Significant break in coverage" means a period of sixty-three (63) consecutive 11
days during each of which an individual does not have any creditable 12
coverage; and 13
(g) "Waiting period" means the period that must pass before coverage for an 14
employee or dependent who is otherwise eligible to enroll under the terms of a 15
group health plan can become effective. If an employee or dependent enrolls 16
as a late enrollee or special enrollee, any period before such late or special 17
enrollment is not a waiting period. If an individual seeks coverage in the 18
individual market, a waiting period begins on the date the individual submits a 19
substantially complete application for coverage and ends on: 20
1. If the application results in coverage, the date coverage begins; or 21
2. If the application does not result in coverage, the date on which the 22
application is denied by the insurer or the date on which the offer of 23
coverage lapses. 24
(7) (a) 1. Except as otherwise provided under subsection (3) of this section, for 25
purposes of applying subsection (2)(c) of this section, a group health 26
plan, and a health insurance insurer offering group health insurance 27 UNOFFICIAL COPY 22 RS BR 99
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coverage, shall count a period of creditable coverage without regard to 1
the specific benefits covered during the period. 2
2. A group health plan, or a health insurance insurer offering group health 3
insurance coverage, may elect to apply subsection (2)(c) of this section 4
based on coverage of benefits within each of several classes or 5
categories of benefits specified in federal regulations. This election shall 6
be made on a uniform basis for all participants and beneficiaries. Under 7
this election, a group health plan or insurer shall count a period of 8
creditable coverage with respect to any class or category of benefits if 9
any level of benefits is covered within this class or category. 10
3. In the case of an election with respect to a group health plan under 11
subparagraph 2. of this paragraph, whether or not health insurance 12
coverage is provided in connection with the plan, the plan shall: 13
a. Prominently state in any disclosure statements concerning the plan, 14
and state to each enrollee at the time of enrollment under the plan, 15
that the plan has made this election; and 16
b. Include in these statements a description of the effect of this 17
election. 18
(b) Periods of creditable coverage with respect to an individual shall be 19
established through presentation of certifications described in subsection (9) 20
of this section or in such other manner as may be specified in administrative 21
regulations. 22
(8) (a) Subject to paragraph (e) of this subsection, a group health plan, and a health 23
insurance insurer offering group health insurance coverage, may not impose 24
any pre-existing condition exclusion on a child who, within thirty (30) days 25
after birth, is covered under any creditable coverage. If a child is enrolled in a 26
group health plan or other creditable coverage within thirty (30) days after 27 UNOFFICIAL COPY 22 RS BR 99
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birth and subsequently enrolls in another group health plan without a 1
significant break in coverage, the other group health plan may not impose any 2
pre-existing condition exclusion on the child. 3
(b) Subject to paragraph (e) of this subsection, a group health plan, and a health 4
insurance insurer offering group health insurance coverage, may not impose 5
any pre-existing condition exclusion on a child who is adopted or placed for 6
adoption before attaining eighteen (18) years of age and who, within thirty 7
(30) days after the adoption or placement for adoption, is covered under any 8
creditable coverage. If a child is enrolled in a group health plan or other 9
creditable coverage within thirty (30) days after adoption or placement for 10
adoption and subsequently enrolls in another group health plan without a 11
significant break in coverage, the other group health plan may not impose any 12
pre-existing condition exclusion on the child. This shall not apply to coverage 13
before the date of the adoption or placement for adoption. 14
(c) A group health plan may not impose any pre-existing condition exclusion 15
relating to pregnancy. 16
(d) A group health plan may not impose a pre-existing condition exclusion 17
relating to a condition based solely on genetic information. If an individual is 18
diagnosed with a condition, even if the condition relates to genetic 19
information, the insurer may impose a pre-existing condition exclusion with 20
respect to the condition, subject to other requirements of this section. 21
(e) Paragraphs (a) and (b) of this subsection shall no longer apply to an individual 22
after the end of the first sixty-three (63) day period during all of which the 23
individual was not covered under any creditable coverage. 24
(9) (a) 1. A group health plan, and a health insurance insurer offering group health 25
insurance coverage, shall provide a certificate of creditable coverage as 26
described in subparagraph 2. of this subsection. A certificate of 27 UNOFFICIAL COPY 22 RS BR 99
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creditable coverage shall be provided, without charge, for participants or 1
dependents who are or were covered under a group health plan upon the 2
occurrence of any of the following events: 3
a. At the time an individual ceases to be covered under a health 4
benefit plan or otherwise becomes eligible under a COBRA 5
continuation provision; 6
b. In the case of an individual becoming covered under a COBRA 7
continuation provision, at the time the individual ceases to be 8
covered under the COBRA continuation provision; and 9
c. On request on behalf of an individual made not later than twenty-10
four (24) months after the date of cessation of the coverage 11
described in subdivision a. or b. of this subparagraph, whichever is 12
later. 13
The certificate of creditable coverage as described under subdivision a. 14
of this subparagraph may be provided, to the extent practicable, at a time 15
consistent with notices required under any applicable COBRA 16
continuation provision. 17
2. The certification described in this subparagraph is a written certification 18
of: 19
a. The period of creditable coverage of the individual under the 20
health benefit plan and the coverage, if any, under the COBRA 21
continuation provision; and 22
b. The waiting period, if any, and affiliation period, if applicable, 23
imposed with respect to the individual for any coverage under the 24
plan. 25
3. To the extent that medical care under a group health plan consists of 26
group health insurance coverage, the plan is deemed to have satisfied the 27 UNOFFICIAL COPY 22 RS BR 99
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certification requirement under this paragraph if the health insurance 1
insurer offering the coverage provides for the certification in accordance 2
with this paragraph. 3
(b) In the case of an election described in subsection (7)(a)2. of this section by a 4
group health plan or health insurance insurer, if the plan or insurer enrolls an 5
individual for coverage under the plan and the individual provides a 6
certification of coverage of the individual under paragraph (a) of this 7
subsection: 8
1. Upon request of that plan or insurer, the entity that issued the 9
certification provided by the individual shall promptly disclose to the 10
requesting plan or insurer information on coverage of classes and 11
categories of health benefits available under the entity's plan or 12
coverage; and 13
2. The entity may charge the requesting plan or insurer for the reasonable 14
cost of disclosing this information. 15
(10) (a) A group health plan, and a health insurance insurer offering group health 16
insurance coverage in connection with a group health plan, shall permit an 17
employee who is eligible but not enrolled for coverage under the terms of the 18
plan, or a dependent of that employee if the dependent is eligible but not 19
enrolled for coverage under these terms, to enroll for coverage under the terms 20
of the plan if each of the following conditions is met: 21
1. The employee or dependent was covered under a group health plan or 22
had health insurance coverage at the time coverage was previously 23
offered to the employee or dependent; 24
2. The employee stated in writing at that time that coverage under a group 25
health plan or health insurance coverage was the reason for declining 26
enrollment, but only if the plan sponsor or insurer, if applicable, required 27 UNOFFICIAL COPY 22 RS BR 99
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that statement at that time and provided the employee with notice of the 1
requirement, and the consequences of the requirement, at that time; 2
3. The employee's or dependent's coverage described in subparagraph 1. of 3
this paragraph: 4
a. Was under a COBRA continuation provision and the coverage 5
under that provision was exhausted; or 6
b. Was not under such a provision and either the coverage was 7
terminated as a result of loss of eligibility for the coverage, 8
including as a result of legal separation, divorce, cessation of 9
dependent status, such as obtaining the maximum age to be 10
eligible as a dependent child, death of the employee, termination of 11
employment, reduction in the number of hours of employment, 12
employer contributions toward the coverage were terminated, a 13
situation in which an individual incurs a claim that would meet or 14
exceed a lifetime limit on all benefits, or a situation in which a 15
plan no longer offers any benefits to the class of similarly situated 16
individuals that includes the individual; or 17
c. Was offered through a health maintenance organization or other 18
arrangement in the group market that does not provide benefits to 19
individuals who no longer reside, live, or work in a service area 20
and, loss of coverage in the group market occurred because an 21
individual no longer resides, lives, or works in the service area, 22
whether or not within the choice of the individual, and no other 23
benefit package is available to the individual; and 24
4. An insurer shall allow an employee and dependent a period of at least 25
thirty (30) days after an event described in this paragraph has occurred to 26
request enrollment for the employee or the employee's dependent. 27 UNOFFICIAL COPY 22 RS BR 99
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Coverage shall begin no later than the first day of the first calendar 1
month beginning after the date the insurer receives the request for 2
special enrollment. 3
(b) A dependent of a current employee, including the employee's spouse, and the 4
employee each are eligible for enrollment in the group health plan subject to 5
plan eligibility rules conditioning dependent enrollment on enrollment of the 6
employee if the requirements of paragraph (a) of this subsection are satisfied. 7
(c) 1. If: 8
a. A group health plan makes coverage available with respect to a 9
dependent of an individual; 10
b. The individual is a participant under the plan, or has met any 11
waiting period applicable to becoming a participant under the plan 12
and is eligible to be enrolled under the plan but for a failure to 13
enroll during a previous enrollment period; and 14
c. A person becomes such a dependent of the individual through 15
marriage, birth, or adoption or placement for adoption; 16
the group health plan shall provide for a dependent special enrollment 17
period described in subparagraph 2. of this paragraph during which the 18
person or, if not otherwise enrolled, the individual, may be enrolled 19
under the plan as a dependent of the individual, and in the case of the 20
birth or adoption of a child, the spouse of the individual may be enrolled 21
as a dependent of the individual if the spouse is otherwise eligible for 22
coverage. 23
2. A dependent special enrollment period under this subparagraph shall be 24
a period of at least thirty (30) days and shall begin on the later of: 25
a. The date dependent coverage is made available; or 26
b. The date of the marriage, birth, or adoption or placement for 27 UNOFFICIAL COPY 22 RS BR 99
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adoption, as the case may be, described in subparagraph 1.c. of this 1
paragraph. 2
3. If an individual seeks to enroll a dependent during the first thirty (30) 3
days of the dependent special enrollment period, the coverage of the 4
dependent shall become effective: 5
a. In the case of marriage, not later than the first day of the first 6
month beginning after the date the completed request for 7
enrollment is received; 8
b. In the case of a dependent's birth, as of the date of the birth; or 9
c. In the case of a dependent's adoption or placement for adoption, 10
the date of the adoption or placement for adoption. 11
(d) At or before the time an employee is initially offered the opportunity to enroll 12
in a group health plan, the employer shall provide the employee with a notice 13
of special enrollment rights. 14
(11) (a) In the case of a group health plan that offers medical care through health 15
insurance coverage offered by a health maintenance organization, the plan 16
may provide for an affiliation period with respect to coverage through the 17
organization only if: 18
1. No pre-existing condition exclusion is imposed with respect to coverage 19
through the organization; 20
2. The period is applied uniformly without regard to any health status-21
related factors; and 22
3. The period does not exceed two (2) months, or three (3) months in the 23
case of a late enrollee. 24
(b) 1. For purposes of this section, the term "affiliation period" means a period 25
which, under the terms of the health insurance coverage offered by the 26
health maintenance organization, must expire before the health 27 UNOFFICIAL COPY 22 RS BR 99
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insurance coverage becomes effective. The organization is not required 1
to provide health care services or benefits during this period and no 2
premium shall be charged to the participant or beneficiary for any 3
coverage during the period. 4
2. This period shall begin on the enrollment date. 5
3. An affiliation period under a plan shall run concurrently with any 6
waiting period under the plan. 7
(c) A health maintenance organization described in paragraph (a) of this 8
subsection may use alternative methods other than those described in that 9
paragraph to address adverse selection as approved by the commissioner. 10
Section 6. KRS 304.17A-230 is amended to read as follows: 11
(1) A health insurer offering individual health benefit plan coverage in the individual 12
market in the Commonwealth shall not impose any pre-existing conditions 13
exclusions as to any eligible individual. 14
(2) Each health insurer offering individual health benefit plan coverage in the 15
individual market in the Commonwealth that chooses to impose a pre-existing 16
conditions exclusion on individuals who do not meet the definition of eligible 17
individual shall comply with the provisions of KRS 304.17A-220, which establishes 18
standards and requirements for pre-existing conditions exclusions for group health 19
plans, including crediting previous coverage, and certification of coverage. 20
Pregnancy may be considered to be a pre-existing condition. 21
(3) Genetic information shall not be treated as a pre-existing condition in the absence of 22
a diagnosis of the condition related to the information. 23
(4) The commissioner[Department of Insurance] shall promulgate administrative 24
regulations necessary to carry out the provisions of this section and KRS 304.17A-25
220. 26
(5) The provisions of this section shall be subject to Section 1 of this Act. 27 UNOFFICIAL COPY 22 RS BR 99
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Section 7. KRS 304.17A-250 is amended to read as follows: 1
(1) The commissioner shall, by administrative regulations promulgated under KRS 2
Chapter 13A, define one (1) standard health benefit plan. After July 15, 2004, 3
insurers may offer the standard health benefit plan in the individual or small group 4
markets. Except as may be necessary to coordinate with changes in federal law, the 5
commissioner shall not alter, amend, or replace the standard health benefit plan 6
more frequently than annually. 7
(2) If offered, the standard health benefit plan may be available in at least one (1) of 8
these four (4) forms of coverage: 9
(a) A fee-for-service product type; 10
(b) A health maintenance organization type; 11
(c) A point-of-service type; and 12
(d) A preferred provider organization type. 13
(3) The standard health benefit plan shall be defined so that it meets the requirements of 14
KRS 304.17B-021 for inclusion in calculating assessments and refunds under 15
Kentucky Access. 16
(4) Any health insurer who offers the standard health benefit plan may offer the 17
standard health benefit plan in the individual or small group markets in each and 18
every form of coverage that the health insurer offers to sell. 19
(5) Except as provided in subsection (13) of this section, nothing in this section shall 20
be construed: 21
(a) To require a health insurer to offer a standard health benefit plan in a form of 22
coverage that the health insurer has not selected; 23
(b) To prohibit a health insurer from offering other health benefit plans in the 24
individual or small group markets in addition to the standard health benefit 25
plan; or 26
(c) To require that a standard health benefit plan have guaranteed issue, 27 UNOFFICIAL COPY 22 RS BR 99
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renewability, or pre-existing condition exclusion rights or provisions that are 1
more generous to the applicant than the health insurer would be required to 2
provide under KRS 304.17A-200, 304.17A-220, 304.17A.230, and 304.17A-3
240. 4
(6) All health benefit plans shall cover hospice care at least equal to the Medicare 5
benefits. 6
(7) All health benefit plans shall coordinate benefits with other health benefit plans in 7
accordance with the guidelines for coordination of benefits prescribed by the 8
commissioner as provided in KRS 304.18-085. 9
(8) Every health insurer of any kind, nonprofit hospital, medical-surgical, dental and 10
health service corporation, health maintenance organization, or provider-sponsored 11
health delivery network that issues or delivers an insurance policy in this state that 12
directs or gives any incentives to insureds to obtain health care services from certain 13
health care providers shall not imply or otherwise represent that a health care 14
provider is a participant in or an affiliate of an approved or selected provider 15
network unless the health care provider has agreed in writing to the representation 16
or there is a written contract between the health care provider and the insurer or an 17
agreement by the provider to abide by the terms for participation established by the 18
insurer. This requirement to have written contracts shall apply whenever an insurer 19
includes a health care provider as a part of a preferred provider network or 20
otherwise selects, lists, or approves certain health care providers for use by the 21
insurer's insureds. The obligation set forth in this section for an insurer to have 22
written contracts with providers selected for use by the insurer shall not apply to 23
emergency or out-of-area services. 24
(9) A self-insured plan may select any third party administrator licensed under KRS 25
304.9-052 to adjust or settle claims for persons covered under the self-insured plan. 26
(10) Any health insurer that fails to issue a premium rate quote to an individual within 27 UNOFFICIAL COPY 22 RS BR 99
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thirty (30) days of receiving a properly completed application request for the quote 1
shall be required to issue coverage to that individual and shall not impose any pre-2
existing conditions exclusion on that individual with respect to the coverage. Each 3
health insurer offering individual health insurance coverage in the individual market 4
in the Commonwealth that refuses to issue a health benefit plan to an applicant or 5
insured with a disclosed high-cost condition as specified in KRS 304.17B-001 or 6
for any reason, shall provide the individual with a denial letter within twenty (20) 7
working days of the request for coverage. The letter shall include the name and title 8
of the person making the decision, a statement setting forth the basis for refusing to 9
issue a policy, a description of Kentucky Access, and the telephone number for a 10
contact person who can provide additional information about Kentucky Access. 11
(11) If a standard health benefit plan covers services that the plan's insureds lawfully 12
obtain from health departments established under KRS Chapter 212, the health 13
insurer shall pay the plan's established rate for those services to the health 14
department. 15
(12) No individually insured person shall be required to replace an individual policy with 16
group coverage on becoming eligible for group coverage that is not provided by an 17
employer. In a situation where a person holding individual coverage is offered or 18
becomes eligible for group coverage not provided by an employer, the person 19
holding the individual coverage shall have the option of remaining individually 20
insured, as the policyholder may decide. This shall apply in any such situation that 21
may arise through an association, an affiliated group, the Kentucky state employee 22
health insurance plan, or any other entity. 23
(13) The provisions of this section shall be subject to Section 1 of this Act. 24
Section 8. KRS 304.17A-256 is amended to read as follows: 25
(1) All group health benefit plans which provide dependent benefits shall offer the 26
master policyholder the following two (2) options to purchase coverage for an 27 UNOFFICIAL COPY 22 RS BR 99
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unmarried dependent child: 1
(a) Coverage until age nineteen (19) and coverage to unmarried children from 2
nineteen (19) to twenty-five (25) years of age who are full-time students 3
enrolled in and attending an accredited educational institution and who are 4
primarily dependent on the policyholder for maintenance and support; and 5
(b) Coverage until age twenty-five (25). 6
(2) The offer of coverage under paragraph (b) of subsection (1) of this section shall 7
include a disclaimer that selecting either option may have tax implications. 8
(3) The provisions of this section shall be subject to Section 1 of this Act. 9
Section 9. KRS 304.17A-430 is amended to read as follows: 10
(1) A health benefit plan shall be considered a program plan and is eligible for 11
inclusion in calculating assessments and refunds under the program risk adjustment 12
process if it meets all of the following criteria: 13
(a) The health benefit plan was purchased by an individual to provide benefits for 14
only one (1) or more of the following: the individual, the individual's spouse, 15
or the individual's children. Health insurance coverage provided to an 16
individual in the group market or otherwise in connection with a group health 17
plan does not satisfy this criteria even if the individual, or the individual's 18
spouse or parent, pays some or all of the cost of the coverage unless the 19
coverage is offered in connection with a group health plan that has fewer than 20
two (2) participants as current employees on the first day of the plan year; 21
(b) An individual entitled to benefits under the health benefit plan has been 22
diagnosed with a high-cost condition on or before the effective date of the 23
individual's coverage for coverage issued on a guarantee-issue basis after July 24
15, 1995; 25
(c) The health benefit plan imposes the maximum pre-existing condition 26
exclusion permitted under KRS 304.17A-200; 27 UNOFFICIAL COPY 22 RS BR 99
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(d) The individual purchasing the health benefit plan is not eligible for or covered 1
by other coverage; and 2
(e) The individual is not a state employee eligible for or covered by the state 3
employee health insurance plan under KRS Chapter 18A. 4
(2) Notwithstanding the provisions of subsection (1) of this section, if the total claims 5
paid for the high-cost condition under a program plan for any three (3) consecutive 6
years are less than the premiums paid under the program plan for those three (3) 7
consecutive years, then the following shall occur: 8
(a) The policy shall not be considered to be a program plan thereafter until the 9
first renewal of the policy after there are three (3) consecutive years in which 10
the total claims paid under the policy have exceeded the total premiums paid 11
for the policy and at the time of the renewal the policy also qualifies under 12
subsection (1) as a program plan; and 13
(b) Within the last six (6) months of the third year, the insurer shall provide each 14
person entitled to benefits under the policy who has a high-cost condition with 15
a written notice of insurability. The notice shall state that the recipient may be 16
able to purchase a health benefit plan other than a program plan and shall also 17
state that neither the notice nor the individual's actions to purchase a health 18
benefit plan other than a program plan shall affect the individual's eligibility 19
for plan coverage. The notice shall be valid for six (6) months. 20
(3) (a) There is established within the guaranteed acceptance program the alternative 21
underwriting mechanism that a participating insurer may elect to use. An 22
insurer that elects this mechanism shall use the underwriting criteria that the 23
insurer has used for the past twelve (12) months for purposes of the program 24
plan requirement in paragraph (b) of subsection (1) of this section for high-25
risk individuals rather than using the criteria established in KRS 304.17A-005 26
and 304.17A-280 for high-cost conditions. 27 UNOFFICIAL COPY 22 RS BR 99
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(b) An insurer that elects to use the alternative underwriting mechanism shall 1
make written application to the commissioner. Before the insurer may 2
implement the mechanism, the insurer shall obtain approval of the 3
commissioner. Annually thereafter, the insurer shall obtain the commissioner's 4
approval of the underwriting criteria of the insurer before the insurer may 5
continue to use the alternative underwriting mechanism. 6
(4) The provisions of this section shall be subject to Section 1 of this Act. 7
Section 10. KRS 304.17-310 is amended to read as follows: 8
(1) Family expense health insurance is that provided under a policy issued to one (1) of 9
the family members insured, who shall be deemed the policyholder, covering any 10
two (2) or more eligible members of a family, including husband, wife, unmarried 11
dependent children, to age nineteen (19), unmarried children from nineteen (19) to 12
twenty-five (25) years of age who are full-time students enrolled in and attending an 13
accredited educational institution and who are primarily dependent on the 14
policyholder for maintenance and support, and any other person dependent upon the 15
policyholder. Any authorized health insurer may issue the insurance. 16
(2) An individual hospital or medical expense insurance policy or hospital or medical 17
service plan contract delivered or issued for delivery in this state more than 120 18
days after June 13, 1968, which provides that coverage of a dependent child shall 19
terminate upon attainment of the limiting age for dependent children specified in the 20
policy or contract shall also provide in substance that attainment of the limiting age 21
shall not operate to terminate the coverage of the child while the child is and 22
continues to be both (a) incapable of self-sustaining employment by reason of an 23
intellectual or physical disability and (b) chiefly dependent upon the policyholder or 24
subscriber for support and maintenance, provided proof of the incapacity and 25
dependency is furnished to the insurer or corporation by the policyholder or 26
subscriber within thirty-one (31) days of the child's attainment of the limiting age 27 UNOFFICIAL COPY 22 RS BR 99
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and subsequently as may be required by the insurer or corporation but not more 1
frequently than annually after the two (2) year period following the child's 2
attainment of the limiting age. 3
(3) Insurers offering family expense health insurance shall offer the applicant the option 4
to purchase coverage for unmarried dependent children until age twenty-five (25). 5
(4) The provisions of this section shall be subject to Section 1 of this Act. 6
Section 11. KRS 304.17B-015 is amended to read as follows: 7
(1) Any individual who is an eligible individual and a resident of Kentucky is eligible 8
for coverage under Kentucky Access, except as specified in paragraphs (a), (b), (d), 9
and (e) of subsection (4) of this section. 10
(2) Any individual who is not an eligible individual who has been a resident of the 11
Commonwealth for at least twelve (12) months immediately preceding the 12
application for Kentucky Access coverage is eligible for coverage under Kentucky 13
Access if one (1) of the following conditions is met: 14
(a) The individual has been rejected by at least one (1) insurer for coverage of a 15
health benefit plan that is substantially similar to Kentucky Access coverage; 16
(b) The individual has been offered coverage substantially similar to Kentucky 17
Access coverage at a premium rate greater than the Kentucky Access premium 18
rate at the time of enrollment or upon renewal; or 19
(c) The individual has a high-cost condition listed in KRS 304.17B-001. 20
(3) A Kentucky Access enrollee whose premium rates exceed claims for a three (3) year 21
period shall be issued a notice of insurability. The notice shall indicate that the 22
Kentucky Access enrollee has not had claims exceed premium rates for a three (3) 23
year period and may be used by the enrollee to obtain insurance in the regular 24
individual market. 25
(4) An individual shall not be eligible for coverage under Kentucky Access if: 26
(a) 1. The individual has, or is eligible for, on the effective date of coverage 27 UNOFFICIAL COPY 22 RS BR 99
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under Kentucky Access, substantially similar coverage under another 1
contract or policy, unless the individual was issued coverage from a 2
GAP participating insurer as a GAP qualified individual prior to January 3
1, 2001. A GAP qualified individual shall be automatically eligible for 4
coverage under Kentucky Access without regard to the requirements of 5
subsection (2) of this section; or 6
2. For individuals meeting the requirements of KRS 304.17A-005(11), the 7
individual has, or is eligible for, on the effective date of coverage under 8
Kentucky Access, coverage under a group health plan. 9
An individual who is ineligible for coverage pursuant to this paragraph shall 10
not preclude the individual's spouse or dependents from being eligible for 11
Kentucky Access coverage. As used in this paragraph, "eligible for" includes 12
any individual and an individual's spouse or dependent who was eligible for 13
coverage but waived that coverage. That individual and the individual's 14
spouse or dependent shall be ineligible for Kentucky Access coverage through 15
the period of waived coverage; 16
(b) The individual is eligible for coverage under Medicaid or Medicare; 17
(c) The individual previously terminated Kentucky Access coverage and twelve 18
(12) months have not elapsed since the coverage was terminated, unless the 19
individual demonstrates a good faith reason for the termination; 20
(d) Except for covered benefits paid under the standard health benefit plan as 21
specified in KRS 304.17B-019, Kentucky Access has paid two million dollars 22
($2,000,000) in covered benefits per individual. The maximum limit under 23
this paragraph may be increased by the office; 24
(e) The individual is confined to a public institution or incarcerated in a federal, 25
state, or local penal institution or in the custody of federal, state, or local law 26
enforcement authorities, including work release programs; or 27 UNOFFICIAL COPY 22 RS BR 99
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(f) The individual's premium, deductible, coinsurance, or copayment is partially 1
or entirely paid or reimbursed by an individual or entity other than the 2
individual or the individual's parent, grandparent, spouse, child, stepchild, 3
father-in-law, mother-in-law, son-in-law, daughter-in-law, sibling, brother-in-4
law, sister-in-law, grandchild, guardian, or court-appointed payor. 5
(5) The coverage of any person who ceases to meet the requirements of this section or 6
the requirements of any administrative regulation promulgated under this subtitle 7
may be terminated. 8
(6) The provisions of this section shall be subject to Section 1 of this Act. 9
Section 12. KRS 304.17B-019 is amended to read as follows: 10
(1) Kentucky Access shall offer at least three (3) health benefit plans to enrollees, 11
which shall be similar to the health benefit plans currently being marketed to 12
individuals in the individual market. 13
(2) At least one (1) plan shall be offered in a traditional fee-for-service form. At least 14
one (1) plan may be offered in a managed-care form at such time as the Office of 15
Health Data and Analytics can establish an appropriate provider network in 16
available service areas. 17
(3) The office shall provide for utilization review and case management for all health 18
benefit plans issued under Kentucky Access. 19
(4) The office shall review and compare health benefit plans provided under Kentucky 20
Access to health benefit plans provided in the individual market. Based on the 21
review, the office may amend or replace the health benefit plans issued under 22
Kentucky Access. 23
(5) Individuals who apply and are determined eligible for health benefit plans issued 24
under Kentucky Access shall have coverage effective the first day of the month after 25
the application month. 26
(6) For eligible individuals, health benefit plans issued under Kentucky Access shall 27 UNOFFICIAL COPY 22 RS BR 99
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not impose any pre-existing condition exclusions. In all other cases, a pre-existing 1
condition exclusion may be imposed in accordance with KRS 304.17A-230. 2
(7) Health benefit plans issued under Kentucky Access shall be guaranteed renewable 3
except as otherwise specified in KRS 304.17B-015 and KRS 304.17A-240. 4
(8) All health benefit plans issued under Kentucky Access shall provide that, upon the 5
death or divorce of the individual in whose name the contract was issued, every 6
other person covered in the contract may elect within sixty-three (63) days to 7
continue under the same or a different contract. 8
(9) Health benefit plans issued under Kentucky Access shall coordinate benefits with 9
other health benefit plans and be the payor of last resort. 10
(10) Health benefit plans issued under Kentucky Access shall pay covered benefits up to 11
a lifetime limit of two million dollars ($2,000,000) per covered individual. The 12
maximum limit under this subsection may be increased by the office. 13
(11) The provisions of this section shall be subject to Section 1 of this Act. 14
Section 13. KRS 304.18-114 is amended to read as follows: 15
(1) As used in this section: 16
(a) "Conversion health insurance coverage" means a health benefit plan meeting 17
the requirements of this section and regulated in accordance with Subtitles 17 18
and 17A of this chapter; 19
(b) "Group policy" has the meaning provided in KRS 304.18-110; and 20
(c) "Medicare" has the meaning provided in KRS 304.18-110. 21
(2) An insurer providing group health insurance coverage shall offer a conversion 22
health insurance policy, by written notice, to any group member terminated under 23
the group policy for any reason. The insurer shall offer a conversion health 24
insurance policy substantially similar to the group policy. The former group 25
member shall meet the following conditions: 26
(a) The former group member had been a member of the group and covered under 27 UNOFFICIAL COPY 22 RS BR 99
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any health insurance policy offered by the group for at least three (3) months; 1
(b) The former group member must make written application to the insurer for 2
conversion health insurance coverage not later than thirty-one (31) days after 3
notice pursuant to subsection (5) of this section; and 4
(c) The former group member must pay the monthly, quarterly, semiannual, or 5
annual premium, at the option of the applicant, to the insurer not later than 6
thirty-one (31) days after notice pursuant to subsection (5) of this section. 7
(3) An insurer shall offer the following terms of conversion health insurance coverage: 8
(a) Conversion health insurance coverage shall be available without evidence of 9
insurability and may contain a pre-existing condition limitation in accordance 10
with KRS 304.17A-230; 11
(b) The premium for conversion health insurance coverage shall be according to 12
the insurer's table of premium rates in effect on the latter of: 13
1. The effective date of the conversion policy; or 14
2. The date of application when the premium rate applies to the class of 15
risk to which the covered persons belong, to their ages, and to the form 16
and amount of insurance provided; 17
(c) The conversion health insurance policy shall cover the former group member 18
and eligible dependents covered by the group policy on the date coverage 19
under the group policy terminated. 20
(d) The effective date of the conversion health insurance policy shall be the date 21
of termination of coverage under the group policy; and 22
(e) The conversion health insurance policy shall provide benefits substantially 23
similar to those provided by the group policy, but not less than the minimum 24
standards set forth in KRS 304.18-120 and any administrative regulations 25
promulgated thereunder. 26
(4) Conversion health insurance coverage need not be granted in the following 27 UNOFFICIAL COPY 22 RS BR 99
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situations: 1
(a) On the effective date of coverage, the applicant is or could be covered by 2
Medicare; 3
(b) On the effective date of coverage, the applicant is or could be covered by 4
another group coverage (insured or uninsured) or, the applicant is covered by 5
substantially similar benefits by another individual hospital, surgical, or 6
medical expenses insurance policy; or 7
(c) The issuance of conversion health insurance coverage would cause the 8
applicant to be overinsured according to the insurer's standards, taking into 9
account that the applicant is or could be covered by similar benefits pursuant 10
to or in accordance with the requirements of any statute and the individual 11
coverage described in paragraph (b) of this subsection. 12
(5) Notice of the right to conversion health insurance coverage shall be given as 13
follows: 14
(a) For group policies delivered, issued for delivery, or renewed after July 15, 15
2002, the insurer shall give written notice of the right to conversion health 16
insurance coverage to any former group member entitled to conversion 17
coverage under this section upon notice from the group policyholder that the 18
group member has terminated membership in the group, upon termination of 19
the former group member's continued group health insurance coverage 20
pursuant to KRS 304.18-110 or COBRA as defined in KRS 304.17A-21
005[(7)], or upon termination of the group policy for any reason. The written 22
notice shall clearly explain the former group member's right to a conversion 23
policy. 24
(b) The thirty-one (31) day period of subsection (2)(b) of this section shall not 25
begin to run until the notice required by this subsection is mailed or delivered 26
to the last known address of the former group member. 27 UNOFFICIAL COPY 22 RS BR 99
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(c) If a former group member becomes entitled to obtain conversion health 1
insurance coverage, pursuant to this section, and the insurer fails to give the 2
former group member written notice of the right, pursuant to this subsection, 3
the insurer shall give written notice to the former group member as soon as 4
practicable after being notified of the insurer's failure to give written notice of 5
conversion rights to the former group member and such former group member 6
shall have an additional period within which to exercise his conversion rights. 7
The additional period shall expire sixty (60) days after written notice is 8
received from the insurer. Written notice delivered or mailed to the last known 9
address of the former group member shall constitute the giving of notice for 10
the purpose of this paragraph. If a former group member makes application 11
and pays the premium, for conversion health insurance coverage within the 12
additional period allowed by this paragraph, the effective date of conversion 13
health insurance coverage shall be the date of termination of group health 14
insurance coverage. However, nothing in this subsection shall require an 15
insurer to give notice or provide conversion coverage to a former group 16
member ninety (90) days after termination of the former group member's 17
group coverage. 18
(6) The provisions of this section shall be subject to Section 1 of this Act. 19
Section 14. KRS 304.18-120 is amended to read as follows: 20
(1) A converted policy issued pursuant to the conversion privilege contained in a group 21
policy providing hospital or surgical expense insurance shall not impose a lifetime 22
maximum benefit of less than five hundred thousand dollars ($500,000). 23
(2) The commissioner by administrative regulation shall establish minimum benefits 24
for a converted policy issued pursuant to the conversion privilege contained in a 25
group health policy. 26
(3) The provisions of this section shall be subject to Section 1 of this Act. 27 UNOFFICIAL COPY 22 RS BR 99
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Section 15. KRS 18A.225 (Effective January 1, 2022) is amended to read as 1
follows: 2
(1) (a) The term "employee" for purposes of this section means: 3
1. Any person, including an elected public official, who is regularly 4
employed by any department, office, board, agency, or branch of state 5
government; or by a public postsecondary educational institution; or by 6
any city, urban-county, charter county, county, or consolidated local 7
government, whose legislative body has opted to participate in the state-8
sponsored health insurance program pursuant to KRS 79.080; and who 9
is either a contributing member to any one (1) of the retirement systems 10
administered by the state, including but not limited to the Kentucky 11
Retirement Systems, County Employees Retirement System, Kentucky 12
Teachers' Retirement System, the Legislators' Retirement Plan, or the 13
Judicial Retirement Plan; or is receiving a contractual contribution from 14
the state toward a retirement plan; or, in the case of a public 15
postsecondary education institution, is an individual participating in an 16
optional retirement plan authorized by KRS 161.567; or is eligible to 17
participate in a retirement plan established by an employer who ceases 18
participating in the Kentucky Employees Retirement System pursuant to 19
KRS 61.522 whose employees participated in the health insurance plans 20
administered by the Personnel Cabinet prior to the employer's effective 21
cessation date in the Kentucky Employees Retirement System; 22
2. Any certified or classified employee of a local board of education; 23
3. Any elected member of a local board of education; 24
4. Any person who is a present or future recipient of a retirement 25
allowance from the Kentucky Retirement Systems, County Employees 26
Retirement System, Kentucky Teachers' Retirement System, the 27 UNOFFICIAL COPY 22 RS BR 99
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Legislators' Retirement Plan, the Judicial Retirement Plan, or the 1
Kentucky Community and Technical College System's optional 2
retirement plan authorized by KRS 161.567, except that a person who is 3
receiving a retirement allowance and who is age sixty-five (65) or older 4
shall not be included, with the exception of persons covered under KRS 5
61.702(4)(c), unless he or she is actively employed pursuant to 6
subparagraph 1. of this paragraph; and 7
5. Any eligible dependents and beneficiaries of participating employees 8
and retirees who are entitled to participate in the state-sponsored health 9
insurance program; 10
(b) The term "health benefit plan" for the purposes of this section means a health 11
benefit plan as defined in KRS 304.17A-005; 12
(c) The term "insurer" for the purposes of this section means an insurer as defined 13
in KRS 304.17A-005; and 14
(d) The term "managed care plan" for the purposes of this section means a 15
managed care plan as defined in KRS 304.17A-500. 16
(2) (a) The secretary of the Finance and Administration Cabinet, upon the 17
recommendation of the secretary of the Personnel Cabinet, shall procure, in 18
compliance with the provisions of KRS 45A.080, 45A.085, and 45A.090, 19
from one (1) or more insurers authorized to do business in this state, a group 20
health benefit plan that may include but not be limited to health maintenance 21
organization (HMO), preferred provider organization (PPO), point of service 22
(POS), and exclusive provider organization (EPO) benefit plans encompassing 23
all or any class or classes of employees. With the exception of employers 24
governed by the provisions of KRS Chapters 16, 18A, and 151B, all 25
employers of any class of employees or former employees shall enter into a 26
contract with the Personnel Cabinet prior to including that group in the state 27 UNOFFICIAL COPY 22 RS BR 99
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health insurance group. The contracts shall include but not be limited to 1
designating the entity responsible for filing any federal forms, adoption of 2
policies required for proper plan administration, acceptance of the contractual 3
provisions with health insurance carriers or third-party administrators, and 4
adoption of the payment and reimbursement methods necessary for efficient 5
administration of the health insurance program. Health insurance coverage 6
provided to state employees under this section shall, at a minimum, contain 7
the same benefits as provided under Kentucky Kare Standard as of January 1, 8
1994, and shall include a mail-order drug option as provided in subsection 9
(13) of this section. All employees and other persons for whom the health care 10
coverage is provided or made available shall annually be given an option to 11
elect health care coverage through a self-funded plan offered by the 12
Commonwealth or, if a self-funded plan is not available, from a list of 13
coverage options determined by the competitive bid process under the 14
provisions of KRS 45A.080, 45A.085, and 45A.090 and made available 15
during annual open enrollment. 16
(b) The policy or policies shall be approved by the commissioner of insurance and 17
may contain the provisions the commissioner of insurance approves, whether 18
or not otherwise permitted by the insurance laws. 19
(c) Any carrier bidding to offer health care coverage to employees shall agree to 20
provide coverage to all members of the state group, including active 21
employees and retirees and their eligible covered dependents and 22
beneficiaries, within the county or counties specified in its bid. Except as 23
provided in subsection (20) of this section, any carrier bidding to offer health 24
care coverage to employees shall also agree to rate all employees as a single 25
entity, except for those retirees whose former employers insure their active 26
employees outside the state-sponsored health insurance program. 27 UNOFFICIAL COPY 22 RS BR 99
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(d) Any carrier bidding to offer health care coverage to employees shall agree to 1
provide enrollment, claims, and utilization data to the Commonwealth in a 2
format specified by the Personnel Cabinet with the understanding that the data 3
shall be owned by the Commonwealth; to provide data in an electronic form 4
and within a time frame specified by the Personnel Cabinet; and to be subject 5
to penalties for noncompliance with data reporting requirements as specified 6
by the Personnel Cabinet. The Personnel Cabinet shall take strict precautions 7
to protect the confidentiality of each individual employee; however, 8
confidentiality assertions shall not relieve a carrier from the requirement of 9
providing stipulated data to the Commonwealth. 10
(e) The Personnel Cabinet shall develop the necessary techniques and capabilities 11
for timely analysis of data received from carriers and, to the extent possible, 12
provide in the request-for-proposal specifics relating to data requirements, 13
electronic reporting, and penalties for noncompliance. The Commonwealth 14
shall own the enrollment, claims, and utilization data provided by each carrier 15
and shall develop methods to protect the confidentiality of the individual. The 16
Personnel Cabinet shall include in the October annual report submitted 17
pursuant to the provisions of KRS 18A.226 to the Governor, the General 18
Assembly, and the Chief Justice of the Supreme Court, an analysis of the 19
financial stability of the program, which shall include but not be limited to 20
loss ratios, methods of risk adjustment, measurements of carrier quality of 21
service, prescription coverage and cost management, and statutorily required 22
mandates. If state self-insurance was available as a carrier option, the report 23
also shall provide a detailed financial analysis of the self-insurance fund 24
including but not limited to loss ratios, reserves, and reinsurance agreements. 25
(f) If any agency participating in the state-sponsored employee health insurance 26
program for its active employees terminates participation and there is a state 27 UNOFFICIAL COPY 22 RS BR 99
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appropriation for the employer's contribution for active employees' health 1
insurance coverage, then neither the agency nor the employees shall receive 2
the state-funded contribution after termination from the state-sponsored 3
employee health insurance program. 4
(g) Any funds in flexible spending accounts that remain after all reimbursements 5
have been processed shall be transferred to the credit of the state-sponsored 6
health insurance plan's appropriation account. 7
(h) Each entity participating in the state-sponsored health insurance program shall 8
provide an amount at least equal to the state contribution rate for the employer 9
portion of the health insurance premium. For any participating entity that used 10
the state payroll system, the employer contribution amount shall be equal to 11
but not greater than the state contribution rate. 12
(3) The premiums may be paid by the policyholder: 13
(a) Wholly from funds contributed by the employee, by payroll deduction or 14
otherwise; 15
(b) Wholly from funds contributed by any department, board, agency, public 16
postsecondary education institution, or branch of state, city, urban-county, 17
charter county, county, or consolidated local government; or 18
(c) Partly from each, except that any premium due for health care coverage or 19
dental coverage, if any, in excess of the premium amount contributed by any 20
department, board, agency, postsecondary education institution, or branch of 21
state, city, urban-county, charter county, county, or consolidated local 22
government for any other health care coverage shall be paid by the employee. 23
(4) If an employee moves his or her place of residence or employment out of the service 24
area of an insurer offering a managed health care plan, under which he or she has 25
elected coverage, into either the service area of another managed health care plan or 26
into an area of the Commonwealth not within a managed health care plan service 27 UNOFFICIAL COPY 22 RS BR 99
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area, the employee shall be given an option, at the time of the move or transfer, to 1
change his or her coverage to another health benefit plan. 2
(5) No payment of premium by any department, board, agency, public postsecondary 3
educational institution, or branch of state, city, urban-county, charter county, 4
county, or consolidated local government shall constitute compensation to an 5
insured employee for the purposes of any statute fixing or limiting the 6
compensation of such an employee. Any premium or other expense incurred by any 7
department, board, agency, public postsecondary educational institution, or branch 8
of state, city, urban-county, charter county, county, or consolidated local 9
government shall be considered a proper cost of administration. 10
(6) The policy or policies may contain the provisions with respect to the class or classes 11
of employees covered, amounts of insurance or coverage for designated classes or 12
groups of employees, policy options, terms of eligibility, and continuation of 13
insurance or coverage after retirement. 14
(7) Group rates under this section shall be made available to the disabled child of an 15
employee regardless of the child's age if the entire premium for the disabled child's 16
coverage is paid by the state employee. A child shall be considered disabled if he or 17
she has been determined to be eligible for federal Social Security disability benefits. 18
(8) The health care contract or contracts for employees shall be entered into for a period 19
of not less than one (1) year. 20
(9) The secretary shall appoint thirty-two (32) persons to an Advisory Committee of 21
State Health Insurance Subscribers to advise the secretary or the secretary's designee 22
regarding the state-sponsored health insurance program for employees. The 23
secretary shall appoint, from a list of names submitted by appointing authorities, 24
members representing school districts from each of the seven (7) Supreme Court 25
districts, members representing state government from each of the seven (7) 26
Supreme Court districts, two (2) members representing retirees under age sixty-five 27 UNOFFICIAL COPY 22 RS BR 99
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(65), one (1) member representing local health departments, two (2) members 1
representing the Kentucky Teachers' Retirement System, and three (3) members at 2
large. The secretary shall also appoint two (2) members from a list of five (5) names 3
submitted by the Kentucky Education Association, two (2) members from a list of 4
five (5) names submitted by the largest state employee organization of nonschool 5
state employees, two (2) members from a list of five (5) names submitted by the 6
Kentucky Association of Counties, two (2) members from a list of five (5) names 7
submitted by the Kentucky League of Cities, and two (2) members from a list of 8
names consisting of five (5) names submitted by each state employee organization 9
that has two thousand (2,000) or more members on state payroll deduction. The 10
advisory committee shall be appointed in January of each year and shall meet 11
quarterly. 12
(10) Notwithstanding any other provision of law to the contrary, the policy or policies 13
provided to employees pursuant to this section shall not provide coverage for 14
obtaining or performing an abortion, nor shall any state funds be used for the 15
purpose of obtaining or performing an abortion on behalf of employees or their 16
dependents. 17
(11) Interruption of an established treatment regime with maintenance drugs shall be 18
grounds for an insured to appeal a formulary change through the established appeal 19
procedures approved by the Department of Insurance, if the physician supervising 20
the treatment certifies that the change is not in the best interests of the patient. 21
(12) Any employee who is eligible for and elects to participate in the state health 22
insurance program as a retiree, or the spouse or beneficiary of a retiree, under any 23
one (1) of the state-sponsored retirement systems shall not be eligible to receive the 24
state health insurance contribution toward health care coverage as a result of any 25
other employment for which there is a public employer contribution. This does not 26
preclude a retiree and an active employee spouse from using both contributions to 27 UNOFFICIAL COPY 22 RS BR 99
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the extent needed for purchase of one (1) state sponsored health insurance policy for 1
that plan year. 2
(13) (a) The policies of health insurance coverage procured under subsection (2) of 3
this section shall include a mail-order drug option for maintenance drugs for 4
state employees. Maintenance drugs may be dispensed by mail order in 5
accordance with Kentucky law. 6
(b) A health insurer shall not discriminate against any retail pharmacy located 7
within the geographic coverage area of the health benefit plan and that meets 8
the terms and conditions for participation established by the insurer, including 9
price, dispensing fee, and copay requirements of a mail-order option. The 10
retail pharmacy shall not be required to dispense by mail. 11
(c) The mail-order option shall not permit the dispensing of a controlled 12
substance classified in Schedule II. 13
(14) The policy or policies provided to state employees or their dependents pursuant to 14
this section shall provide coverage for obtaining a hearing aid and acquiring hearing 15
aid-related services for insured individuals under eighteen (18) years of age, subject 16
to a cap of one thousand four hundred dollars ($1,400) every thirty-six (36) months 17
pursuant to KRS 304.17A-132. 18
(15) Any policy provided to state employees or their dependents pursuant to this section 19
shall provide coverage for the diagnosis and treatment of autism spectrum disorders 20
consistent with KRS 304.17A-142. 21
(16) Any policy provided to state employees or their dependents pursuant to this section 22
shall provide coverage for obtaining amino acid-based elemental formula pursuant 23
to KRS 304.17A-258. 24
(17) If a state employee's residence and place of employment are in the same county, and 25
if the hospital located within that county does not offer surgical services, intensive 26
care services, obstetrical services, level II neonatal services, diagnostic cardiac 27 UNOFFICIAL COPY 22 RS BR 99
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catheterization services, and magnetic resonance imaging services, the employee 1
may select a plan available in a contiguous county that does provide those services, 2
and the state contribution for the plan shall be the amount available in the county 3
where the plan selected is located. 4
(18) If a state employee's residence and place of employment are each located in counties 5
in which the hospitals do not offer surgical services, intensive care services, 6
obstetrical services, level II neonatal services, diagnostic cardiac catheterization 7
services, and magnetic resonance imaging services, the employee may select a plan 8
available in a county contiguous to the county of residence that does provide those 9
services, and the state contribution for the plan shall be the amount available in the 10
county where the plan selected is located. 11
(19) The Personnel Cabinet is encouraged to study whether it is fair and reasonable and 12
in the best interests of the state group to allow any carrier bidding to offer health 13
care coverage under this section to submit bids that may vary county by county or 14
by larger geographic areas. 15
(20) Notwithstanding any other provision of this section, the bid for proposals for health 16
insurance coverage for calendar year 2004 shall include a bid scenario that reflects 17
the statewide rating structure provided in calendar year 2003 and a bid scenario that 18
allows for a regional rating structure that allows carriers to submit bids that may 19
vary by region for a given product offering as described in this subsection: 20
(a) The regional rating bid scenario shall not include a request for bid on a 21
statewide option; 22
(b) The Personnel Cabinet shall divide the state into geographical regions which 23
shall be the same as the partnership regions designated by the Department for 24
Medicaid Services for purposes of the Kentucky Health Care Partnership 25
Program established pursuant to 907 KAR 1:705; 26
(c) The request for proposal shall require a carrier's bid to include every county 27 UNOFFICIAL COPY 22 RS BR 99
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within the region or regions for which the bid is submitted and include but not 1
be restricted to a preferred provider organization (PPO) option; 2
(d) If the Personnel Cabinet accepts a carrier's bid, the cabinet shall award the 3
carrier all of the counties included in its bid within the region. If the Personnel 4
Cabinet deems the bids submitted in accordance with this subsection to be in 5
the best interests of state employees in a region, the cabinet may award the 6
contract for that region to no more than two (2) carriers; and 7
(e) Nothing in this subsection shall prohibit the Personnel Cabinet from including 8
other requirements or criteria in the request for proposal. 9
(21) Any fully insured health benefit plan or self-insured plan issued or renewed on or 10
after July 12, 2006, to public employees pursuant to this section which provides 11
coverage for services rendered by a physician or osteopath duly licensed under KRS 12
Chapter 311 that are within the scope of practice of an optometrist duly licensed 13
under the provisions of KRS Chapter 320 shall provide the same payment of 14
coverage to optometrists as allowed for those services rendered by physicians or 15
osteopaths. 16
(22) Any fully insured health benefit plan or self-insured plan issued or renewed[ on or 17
after June 29, 2021,] to public employees pursuant to this section shall comply with: 18
(a) KRS 304.12-237; 19
(b) KRS 304.17A-270 and 304.17A-525; 20
(c) KRS 304.17A-600 to 304.17A-633; 21
(d) KRS 205.593; 22
(e) KRS 304.17A-700 to 304.17A-730; 23
(f) KRS 304.14-135; 24
(g) KRS 304.17A-580 and 304.17A-641; 25
(h) KRS 304.99-123; 26
(i) KRS 304.17A-138; 27 UNOFFICIAL COPY 22 RS BR 99
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(j) KRS 304.17A-148; 1
(k) Section 1 of this Act; and 2
(l)[(j)] Administrative regulations promulgated pursuant to statutes listed in this 3
subsection. 4
[(23) Any fully insured health benefit plan or self-insured plan issued or renewed on or 5
after January 1, 2022, to public employees pursuant to this section shall comply 6
with KRS 304.17A-148]. 7
Section 16. KRS 164.2871 is amended to read as follows: 8
(1) The governing board of each state postsecondary educational institution is 9
authorized to purchase liability insurance for the protection of the individual 10
members of the governing board, faculty, and staff of such institutions from liability 11
for acts and omissions committed in the course and scope of the individual's 12
employment or service. Each institution may purchase the type and amount of 13
liability coverage deemed to best serve the interest of such institution. 14
(2) All retirement annuity allowances accrued or accruing to any employee of a state 15
postsecondary educational institution through a retirement program sponsored by 16
the state postsecondary educational institution are hereby exempt from any state, 17
county, or municipal tax, and shall not be subject to execution, attachment, 18
garnishment, or any other process whatsoever, nor shall any assignment thereof be 19
enforceable in any court. Except retirement benefits accrued or accruing to any 20
employee of a state postsecondary educational institution through a retirement 21
program sponsored by the state postsecondary educational institution on or after 22
January 1, 1998, shall be subject to the tax imposed by KRS 141.020, to the extent 23
provided in KRS 141.010 and 141.0215. 24
(3) Except as provided in KRS Chapter 44, the purchase of liability insurance for 25
members of governing boards, faculty and staff of institutions of higher education in 26
this state shall not be construed to be a waiver of sovereign immunity or any other 27 UNOFFICIAL COPY 22 RS BR 99
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immunity or privilege. 1
(4) The governing board of each state postsecondary education institution is authorized 2
to provide a self-insured employer group health plan to its employees, which plan 3
shall: 4
(a) Conform to the requirements of Subtitle 32 of KRS Chapter 304; and[ shall ] 5
(b) Except as provided in subsection (5) of this section, be exempt from 6
conformity with Subtitle 17A of KRS Chapter 304. 7
(5) A self-insured employer group health plan provided by the governing board of a 8
state postsecondary education institution to its employees shall comply with 9
Section 1 of this Act. 10