AN ACT TO MAKE TECHNICAL CHANGES TO THE SMALL EMPLOYER GROUP HEALTH COVERAGE REFORM ACT TO MITIGATE THE EFFECTS OF THE FEDERAL AFFORDABLE CARE ACT ON NORTH CAROLINA'S SMALL BUSINESSES AND TO INCREASE STOP LOSS INSURANCE OPTIONS FOR SMALL EMPLOYERS. Enacted July 25, 2013. Section 2 is effective January 1, 2014, except as otherwise provided. Section 3 is effective October 1, 2013. Section 4 is effective January 1, 2016. The remainder is effective June 25, 2013.
Bill Summaries: H649 (2013-2014 Session)
Tracking:
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Summary date: Jul 26 2013 - View summary
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Bill H 649 (2013-2014)Summary date: Jul 10 2013 - View summary
Conference report makes the following changes to the 6th edition.
Amends GS 58-50-130(b1)(1), subdivision (a), by clarifying that the language "three to one" means "the ratio of three to one (3:1) as well as providing that in (b1)(1)d that the tobacco use adjustment shall not vary by more than "the ratio of one and two tenths to one (1.2:1)" (was, more than one and one-fifteenth to one).
Amends 58-50-130(a), providing that no small employer carrier, insurer, subsidiary of an insurer, or controlled individual of an insurance holding company can provide stop loss, catastrophic, or reinsurance coverage to small employers that have an annual attachment point for claims incurred per individual that is lower than $20,000 for plan years beginning in 2013. After that, the amount will be indexed according to the Consumer Price Index for Medical Services for All Urban Consumers for the South Region and will be rounded to the nearest whole thousand dollars. Provides that the index factor will be the index as of July of the year preceding the change divided by the index as of July 2012 (previously, did not include the indexing requirement). Also prohibits the provision of the above coverage to small employers that have an annual aggregate attachment point lower than the greater of (1) 120% of expected claims or (2) $20,000 for plan years beginning in 2013 or after that greater than the amount provided by the above noted indexing (previously, did not include the indexing requirement).
Directs the Department of Insurance to make the amount of the attachment points, as provided in Section 3 of the act, available to the public annually.
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Bill H 649 (2013-2014)Summary date: Jun 12 2013 - View summary
Senate amendment makes the following changes to the 5th edition.
Provides that a small employer carrier, in developing and adjusting premiums for specified small employer group health benefit plans, can make adjustments to premiums for "tobacco use", except that the rate cannot vary by more than one and one-fifteenth to one (was, one and one-half to one).
Amends GS 58-50-130(a), providing that no small employer carrier, insurer, subsidiary of an insurer, or controlled individual of an insurance holding company can provide stop loss, catastrophic, or reinsurance coverage to small employers who employ fewer than 26 eligible employees that does not comply with the underwriting, rating, and other applicable standards in this Act (previously, only referred to small employers, with no number of employees mentioned).
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Bill H 649 (2013-2014)Summary date: Jun 6 2013 - View summary
Senate committee substitute makes the following changes to the 4th edition.
Changes the long title.
Amends GS 58-50-1230(a), regarding stop loss health insurance, providing that an insurer will not issue a stop loss health insurance policy to any entity defined as a small employer if they do any of the following:
(1) Provide direct coverage of health expenses payable to an individual.
(2) Have an annual attachment point for claims incurred per individual that is lower than $20,000.
(3) Have an annual aggregate attachment point lower than the greater of 120% of expected claims or $20,000.
Deletes language that prohibited a specified insurance holding company from acting as an administrator or claims paying agent, as opposed to an insurer, on behalf of small groups.
Above provisions are effective October 1, 2013, and apply to all stop loss insurance contracts and policies issued, renewed, or amended on or after that date.
Directs the Department of Insurance to adopt rules providing for the oversight, monitoring of, and reporting by insurers and third party administrators who administer health benefit plans with stop loss coverage pursuant to this act.
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Bill H 649 (2013-2014)Summary date: May 16 2013 - View summary
House committee substitute makes the following changes to the 3rd edition.
Deletes Section 4.1(a) of the act, which provided for the codification of the findings in the case of Rockford-Cohen Group, LLC, v. North Carolina Department of Insurance, et al., where the Superior Court's order preliminarily enjoined the defendants from enforcing SL 2012-183 in part because it found that the session law violated Section 32 and 33 of Article 1 of the NC Constitution.
Deletes the previous repeal of SL 2012-183 (providing for the pre-licensing and continuing education of bail bondsmen and runners).
Deletes language which made the above provisions retroactively effective on October 1, 2012.
Makes a conforming change.
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Bill H 649 (2013-2014)Summary date: May 2 2013 - View summary
House amendment to the 2nd edition of the act makes the following changes. Adds a new section, the intent of which is to codify the finding in the case of Rockford-Cohen Group, LLC, V. North Carolina Department of Insurance, et al., where the Superior Court's order preliminarily enjoined the defendants from enforcing SL 2012-183 in part because it found that the session law violated Section 32 and 33 of Article 1 of the NC Constitution. Repeals SL 2012-183 (providing for the pre-licensing and continuing education of bail bondsmen and runners). Effective retroactively to October 1, 2012.
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Bill H 649 (2013-2014)Summary date: May 1 2013 - View summary
House committee substitute makes the following changes to the 1st edition.
Deletes all the provisions of the 1st edition and replaces it with the following.
Section 1
Establishes that no small employer carrier will be required to issue the basic or standard health benefit plan as described in GS 58-50-125(a). Provides that any basic or standard health benefit plans that are described in GS 58-50-125(a) that are not "grandfathered health plans," as that term is used in the Affordable Care Act (ACA), will be terminated on the next anniversary date on or after January 1, 2014. After that the small employer carrier must offer the employer replacement coverage from available small group health benefit plans, in accordance with applicable state and federal laws. Requires a 90-day notice before termination. Sets out other requirements for plans that are issued to self-employed individuals.
Effective when the act becomes law.
Section 2
Repeals the following statutes:
GS 58-50-126, Alternative coverage permitted.
GS 58-50-127, Small employer carrier plan elections.
GS 58-50-135, Elections by carriers.
GS 58-50-155, Standard and basic health care plan coverages.
GS 58-50-156, Coverage of certain prescribed drugs for cancer treatment.
Amends GS 58-50-110, Definitions, adding and defining grandfathered health plan to the definitions for the section. Amends GS 58-50-110(22), the definition for small employer, providing that, effective January 1, 2014, the definition applies only to grandfathered group health plans subject to this act. Provides that the term small employer includes self-employed individuals for the purposes of this subsection (was, for the purposes of this act). Enacts new GS 58-50-110(22a), defining small employer as it only applies to non-grandfathered group health plans, providing that it refers to "an employer that employed an average of at least one but not more than 50 employees on business days during the preceding calendar year and that employs at least one employee on the first day of the plan year."
Amends GS 58-50-115, Health benefit plans subject to Act, making conforming changes, deleting references to "self-employed individuals" from the section.
Amends GS 58-50-125(d), deleting provisions of the subsection that relate to basic and standard small group plans, in conformance with the ACA.
Repeals sections (a) and (a1) of GS 58-50-125, Health care plans; formation; approval; offerings, effective January 1, 2015.
Amends subsection (b) of GS 58-50-130, Required health care plan provisions, making conforming changes, specifically making this section applicable to small employer health benefit plans that are grandfathered health benefit plans.
Creates new subsection GS 58-50-130(b1), which sets out provisions concerning small employer health benefit plans that are not grandfathered health benefit plans. Establishes that the premium rates are subject to the specified provisions.
Creates new subsection GS 58-50-130(i), providing that a small employer carrier cannot modify the premium rate charged to a small group non-grandfathered health benefit plan or a small employer group member, including changes in rates related to the increasing age of a group, for 12 months starting from the initial issue or renewal date.
Except as otherwise provided, Section 2 becomes effective January 1, 2014, applying to all insurance contracts and policies issued, renewed, or amended on or after that date.
Section 3
Amends GS 58-50-110, deleting (22a), the definition for small employer as it applies to non-grandfathered group health plans, and creating GS 58-50-110(22b), to define small employer, in connection with a non-grandfathered group health plan with respect to a calendar year and a plan year, as an employer that employed an average of at least one but not more than 100 employees on business days during the preceding calendar year and that employed at least one employee on the first day of the plan year.
Effective January 1, 2016.
Section 4
Directs the Department of Insurance to adopt rules to implement this act.
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Bill H 649 (2013-2014)Summary date: Apr 10 2013 - View summary
Amends GS 58-50-110 (Definitions), deleting the terms Basic health care plan, industry, late enrollee, preexisting conditions provision, and self-employed individual. Provides a new term and definition, Affordable Care Act, meaning the federal Patient Protection and Affordable Care Act. Amends the term small employer to mean any employer who does not meet the definition of an applicable large employer under Section 4980H(c)(2) of the Affordable Care Act.
Deletes GS 58-50-125 (Health care plans; formation; approval; offerings) subsections (a), (a1), (parts of d), and (f), which contained provisions regarding different formations and offerings of health care plans offered by small employer carriers.
Repeals GS 58-50-126(f) (Alternative coverage permitted, discontinuation of basic or standard plans).
Amends GS 58-50-130 (Required health care plan provisions), deleting GS 58-50-130(4b),which established that late enrollees are excluded from preexisting condition coverage for specified time frames. Deletes language in GS 58-50-130(b)(1), relating to the rating of premiums by considering the gender of eligible employees or dependents, and adds a provision for the grandfathering of plans, as defined in the Affordable Care Act. Provides that small employer carriers can develop separate rates for individuals aged 65 or older in regards to situations where Medicare is serving as the primary payor. Deletes age brackets, found in GS 58-50-130(6), previously used for the determining of rates and premiums. Deletes other language dealing with the establishment of rates based on industry.
Effective January 1, 2014.
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Bill H 649 (2013-2014)Summary date: Apr 9 2013 - View summary
To be summarized at a later date.