SB 467 - This act is a compliance bill for the federal Health Insurance Portability and Accountability Act of 1996. It requires availability and renewability of health insurance policies for all groups and all individuals in the state.

GROUPS - The general group insurance statutes of chapter 376 are revised to assure minimum compliance with the federal law.

SMALL GROUPS, INDIVIDUALS - The small group statutes of chapter 379 are rewritten in particular to comply with the federal law and to include individuals. Small employers must have between 2 and 50 employees. The provisions for different classifications of business are deleted.

RATES - Rates for persons in small group plans may not exceed the rates charged for similarly-situated individuals on the basis of health-related factors.

RENEWAL - Currently law generally requires small group policies to be renewed with several exceptions. Under the act, policies need not be renewed if the insurer decides to discontinue a particular type of plan and follows the notification procedures; the Director of Insurance must find that such plan is obsolete and is being replaced with comparable coverage. An insurer that elects not to offer any small group plans shall be prevented from reentering that market for 5 years.

Similar renewal provisions are added for individuals. Network plans may exclude small group employees and individuals who do not reside in the service area of the insurer.

AVAILABILITY - All health benefit plans actively marketed by the insurer shall be made available to small employers and all individuals. Exceptions are provided. All health benefit plans used by the insurer shall be filed with the Director of Insurance; the director may disapprove them if they violate the law.

PREEXISTING CONDITIONS - Preexisting condition limits may be imposed for 6 months for small employers and 12 months for individuals. Such limits shall be reduced by the period of prior creditable coverage (if no more than 63 days intervene). Affiliation periods and waiting periods are limited. Preexisting conditions may not be imposed for pregnancy or adoption. In individual plans, preexisting condition limits may be replaced by rating surcharges or affiliation periods.

A small employer carrier shall not require participation levels greater than 100% for groups of 3 or less, or greater than 75% for groups of more than 3.

REINSURANCE - The Small Employer Health Reinsurance Program is dissolved.

MISC. - Health insurance plans terminated within 6 months before the effective date of this act shall be reissued if so required by the Director of Insurance. The Director of Insurance may determine when a policy issued as a stop loss policy is a health benefit plan. The provisions on active marketing and discrimination are applied to individuals.

EMERGENCY CLAUSE - The act goes into effect on July 1, 1997 or when approved by the Governor, whichever comes later.

MIKE HOEFERKAMP