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2007 Minnesota Statutes

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62A.31 MEDICARE SUPPLEMENT BENEFITS; MINIMUM STANDARDS.
    Subdivision 1. Policy requirements. No individual or group policy, certificate, subscriber
contract issued by a health service plan corporation regulated under chapter 62C, or other evidence
of accident and health insurance the effect or purpose of which is to supplement Medicare
coverage issued or delivered in this state or offered to a resident of this state shall be sold or issued
to an individual covered by Medicare unless the requirements in subdivisions 1a to 1u are met.
    Subd. 1a. Minimum coverage. The policy must provide a minimum of the coverage set out
in subdivision 2 and for an extended basic plan, the additional requirements of section 62E.07.
    Subd. 1b. Preexisting condition coverage. The policy must cover preexisting conditions
during the first six months of coverage if the insured was not diagnosed or treated for the
particular condition during the 90 days immediately preceding the effective date of coverage.
    Subd. 1c. Limitation on cancellation or nonrenewal. The policy must contain a provision
that the plan will not be canceled or nonrenewed on the grounds of the deterioration of health
of the insured.
    Subd. 1d. Mandatory offer. Before the policy is sold or issued, an offer of both categories of
Medicare supplement insurance must be made to the individual, together with an explanation of
both coverages.
    Subd. 1e. Delivery of outline of coverage. An outline of coverage as provided in section
62A.39 must be delivered at the time of application and prior to payment of any premium
and, except for direct response policies, an acknowledgment of receipt of this outline must be
obtained from the applicant.
    Subd. 1f. Suspension based on entitlement to medical assistance. (a) The policy or
certificate must provide that benefits and premiums under the policy or certificate shall be
suspended for any period that may be provided by federal regulation at the request of the
policyholder or certificate holder for the period, not to exceed 24 months, in which the
policyholder or certificate holder has applied for and is determined to be entitled to medical
assistance under title XIX of the Social Security Act, but only if the policyholder or certificate
holder notifies the issuer of the policy or certificate within 90 days after the date the individual
becomes entitled to this assistance.
(b) If suspension occurs and if the policyholder or certificate holder loses entitlement to this
medical assistance, the policy or certificate shall be automatically reinstated, effective as of the
date of termination of this entitlement, if the policyholder or certificate holder provides notice of
loss of the entitlement within 90 days after the date of the loss and pays the premium attributable
to the period, effective as of the date of termination of entitlement.
(c) The policy must provide that upon reinstatement (1) there is no additional waiting period
with respect to treatment of preexisting conditions, (2) coverage is provided which is substantially
equivalent to coverage in effect before the date of the suspension. If the suspended policy
provided coverage for outpatient prescription drugs, reinstitution of the policy for Medicare
Part D enrollees must be without coverage for outpatient prescription drugs and must otherwise
provide coverage substantially equivalent to the coverage in effect before the date of suspension,
and (3) premiums are classified on terms that are at least as favorable to the policyholder or
certificate holder as the premium classification terms that would have applied to the policyholder
or certificate holder had coverage not been suspended.
    Subd. 1g. Notification of counseling services. The written statement required by an
application for Medicare supplement insurance pursuant to section 62A.43, subdivision 1, shall
be made on a form, approved by the commissioner, that states that counseling services may be
available in the state to provide advice concerning the purchase of Medicare supplement policies
and enrollment under the Medicaid program.
    Subd. 1h. Limitations on denials, conditions, and pricing of coverage. No health carrier
issuing Medicare-related coverage in this state may impose preexisting condition limitations or
otherwise deny or condition the issuance or effectiveness of any such coverage available for sale
in this state, nor may it discriminate in the pricing of such coverage, because of the health status,
claims experience, receipt of health care, medical condition, or age of an applicant where an
application for such coverage is submitted prior to or during the six-month period beginning with
the first day of the month in which an individual first enrolled for benefits under Medicare Part B.
This subdivision applies to each Medicare-related coverage offered by a health carrier regardless
of whether the individual has attained the age of 65 years. If an individual who is enrolled in
Medicare Part B due to disability status is involuntarily disenrolled due to loss of disability status,
the individual is eligible for another six-month enrollment period provided under this subdivision
beginning the first day of the month in which the individual later becomes eligible for and enrolls
again in Medicare Part B. An individual who is or was previously enrolled in Medicare Part B
due to disability status is eligible for another six-month enrollment period under this subdivision
beginning the first day of the month in which the individual has attained the age of 65 years and
either maintains enrollment in, or enrolls again in, Medicare Part B. If an individual enrolled in
Medicare Part B voluntarily disenrolls from Medicare Part B because the individual becomes
enrolled under an employee welfare benefit plan, the individual is eligible for another six-month
enrollment period, as provided in this subdivision, beginning the first day of the month in which
the individual later becomes eligible for and enrolls again in Medicare Part B.
    Subd. 1i. Replacement coverage. If a Medicare supplement policy or certificate replaces
another Medicare supplement policy or certificate, the issuer of the replacing policy or certificate
shall waive any time periods applicable to preexisting conditions, waiting periods, elimination
periods, and probationary periods in the new Medicare supplement policy or certificate for
benefits to the extent the time was spent under the original policy or certificate. For purposes of
this subdivision, "Medicare supplement policy or certificate" means all coverage described in
section 62A.011, subdivision 3, clause (10).
    Subd. 1j. Filing and approval. The policy must have been filed with and approved by the
department as meeting all the requirements of sections 62A.3099 to 62A.44.
    Subd. 1k. Guaranteed renewability. The policy must guarantee renewability.
(a) Only the standards for renewability provided in this subdivision may be used in Medicare
supplement insurance policy forms.
(b) No issuer of Medicare supplement insurance policies may cancel or nonrenew a Medicare
supplement policy or certificate for any reason other than nonpayment of premium or material
misrepresentation.
(c) If a group Medicare supplement insurance policy is terminated by the group policyholder
and is not replaced as provided in this clause, the issuer shall offer certificate holders an
individual Medicare supplement policy which, at the option of the certificate holder, provides
for continuation of the benefits contained in the group policy; or provides for such benefits and
benefit packages as otherwise meet the requirements of this clause.
(d) If an individual is a certificate holder in a group Medicare supplement insurance policy
and the individual terminates membership in the group, the issuer of the policy shall offer the
certificate holder the conversion opportunities described in this clause; or offer the certificate
holder continuation of coverage under the group policy.
(e) If a Medicare supplement policy eliminates an outpatient prescription drug benefit
as a result of requirements imposed by the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003, the policy as modified for that purpose is deemed to satisfy the
guaranteed renewal requirements of this subdivision.
    Subd. 1l. Treatment of sickness and accident losses. A Medicare supplement policy or
certificate shall not indemnify against losses resulting from sickness on a different basis than
losses resulting from accidents.
    Subd. 1m. Medicare cost sharing coverage changes. A Medicare supplement policy or
certificate shall provide that benefits designed to cover cost sharing amounts under Medicare will
be changed automatically to coincide with any changes in the applicable Medicare deductible
amount and co-payment percentage factors. Premiums may be modified to correspond with
the changes.
As soon as practicable, but no later than 30 days prior to the annual effective date of any
Medicare benefit changes, an issuer shall notify its policyholders and certificate holders of
modifications it has made to Medicare supplement insurance policies or certificates in a format
acceptable to the commissioner. Such notice shall:
(1) include a description of revisions to the Medicare program and a description of each
modification made to the coverage provided under the Medicare supplement policy or certificate;
and
(2) inform each policyholder or certificate holder as to when any premium adjustment is to
be made, due to changes in Medicare.
The notice of benefit modifications and any premium adjustments must be in outline form
and in clear and simple terms so as to facilitate comprehension.
The notices must not contain or be accompanied by any solicitation.
    Subd. 1n. Termination of coverage. (a) Termination by an issuer of a Medicare supplement
policy or certificate shall be without prejudice to any continuous loss that began while the policy
or certificate was in force, but the extension of benefits beyond the period during which the
policy or certificate was in force may be conditioned on the continuous total disability of the
insured, limited to the duration of the policy or certificate benefit period, if any, or payment of the
maximum benefits. The extension of benefits does not apply when the termination is based on
fraud, misrepresentation, or nonpayment of premium. Receipt of Medicare Part D benefits is not
considered in determining a continuous loss.
(b) An issuer may discontinue the availability of a policy form or certificate form if the
issuer provides to the commissioner in writing its decision at least 30 days before discontinuing
the availability of the form of the policy or certificate. An issuer that discontinues the availability
of a policy form or certificate form shall not file for approval a new policy form or certificate
form of the same type for the same Medicare supplement benefit plan as the discontinued form for
five years after the issuer provides notice to the commissioner of the discontinuance. This period
of ineligibility to file a form for approval may be reduced if the commissioner determines that a
shorter period is appropriate. The sale or other transfer of Medicare supplement business to another
issuer shall be considered a discontinuance for the purposes of this section and section 62A.3099.
A change in the rating structure or methodology shall be considered a discontinuance under this
section and section 62A.3099 unless the issuer complies with the following requirements:
(1) the issuer provides an actuarial memorandum, in a form and manner prescribed by the
commissioner, describing the manner in which the revised rating methodology and resulting rates
differ from the existing rating methodology and resulting rates; and
(2) the issuer does not subsequently put into effect a change of rates or rating factors
that would cause the percentage differential between the discontinued and subsequent rates as
described in the actuarial memorandum to change. The commissioner may approve a change to
the differential that is in the public interest.
    Subd. 1o. Refund or credit calculation. (a) Except as provided in paragraph (b), the
Minnesota experience of all policy forms or certificate forms of the same type in a standard
Medicare supplement benefit plan shall be combined for purposes of the refund or credit
calculation prescribed in section 62A.36.
(b) Forms assumed under an assumption reinsurance agreement shall not be combined with
the Minnesota experience of other forms for purposes of the refund or credit calculation.
    Subd. 1p. Renewal or continuation provisions. Medicare supplement policies and
certificates shall include a renewal or continuation provision. The language or specifications of the
provision shall be consistent with the type of contract issued. The provision shall be appropriately
captioned and shall appear on the first page of the policy or certificate, and shall include any
reservation by the issuer of the right to change premiums. Except for riders or endorsements by
which the issuer effectuates a request made in writing by the insured, exercises a specifically
reserved right under a Medicare supplement policy or certificate, or is required to reduce or
eliminate benefits to avoid duplication of Medicare benefits, all riders or endorsements added to a
Medicare supplement policy or certificate after the date of issue or at reinstatement or renewal
that reduce or eliminate benefits or coverage in the policy or certificate shall require a signed
acceptance by the insured. After the date of policy or certificate issue, a rider or endorsement
that increases benefits or coverage with a concomitant increase in premium during the policy or
certificate term shall be agreed to in writing and signed by the insured, unless the benefits are
required by the minimum standards for Medicare supplement policies or if the increased benefits
or coverage is required by law. Where a separate additional premium is charged for benefits
provided in connection with riders or endorsements, the premium charge shall be set forth in the
policy, declaration page, or certificate. If a Medicare supplement policy or certificate contains
limitations with respect to preexisting conditions, the limitations shall appear as a separate
paragraph of the policy or certificate and be labeled as "preexisting condition limitations."
Issuers of accident and sickness policies or certificates that provide hospital or medical
expense coverage on an expense incurred or indemnity basis to persons eligible for Medicare
shall provide to those applicants a "Guide to Health Insurance for People with Medicare" in the
form developed by the Centers for Medicare and Medicaid Services and in a type size no smaller
than 12-point type. Delivery of the guide must be made whether or not such policies or certificates
are advertised, solicited, or issued as Medicare supplement policies or certificates as defined in
this section and section 62A.3099. Except in the case of direct response issuers, delivery of the
guide must be made to the applicant at the time of application, and acknowledgment of receipt of
the guide must be obtained by the issuer. Direct response issuers shall deliver the guide to the
applicant upon request, but no later than the time at which the policy is delivered.
    Subd. 1q. Marketing procedures. (1) An issuer, directly or through its producers, shall:
(i) establish marketing procedures to assure that a comparison of policies by its agents
or other producers will be fair and accurate;
(ii) establish marketing procedures to ensure that excessive insurance is not sold or issued;
(iii) establish marketing procedures that set forth a mechanism or formula for determining
whether a replacement policy or certificate contains benefits clearly and substantially greater than
the benefits under the replaced policy or certificate;
(iv) display prominently by type or other appropriate means, on the first page of the policy or
certificate, the following:
"Notice to buyer: This policy or certificate may not cover all of your medical expenses";
(v) inquire and otherwise make every reasonable effort to identify whether a prospective
applicant or enrollee for Medicare supplement insurance already has accident and sickness
insurance and the types and amounts of the insurance;
(vi) establish auditable procedures for verifying compliance with this subdivision;
(2) in addition to the practices prohibited in chapter 72A, the following acts and practices
are prohibited:
(i) knowingly making any misleading representation or incomplete or fraudulent comparison
of any insurance policies or issuers for the purpose of inducing, or tending to induce, any person
to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance
policy or to take out a policy of insurance with another insurer;
(ii) employing any method of marketing having the effect of or tending to induce the
purchase of insurance through force, fright, threat, whether explicit or implied, or undue pressure
to purchase or recommend the purchase of insurance;
(iii) making use directly or indirectly of any method of marketing which fails to disclose in a
conspicuous manner that a purpose of the method of marketing is solicitation of insurance and
that contact will be made by an insurance agent or insurance company;
(3) the terms "Medicare supplement," "medigap," and words of similar import shall not be
used unless the policy or certificate is issued in compliance with this subdivision.
    Subd. 1r. Community rate. Each health maintenance organization, health service plan
corporation, insurer, or fraternal benefit society that sells Medicare-related coverage shall establish
a separate community rate for that coverage. Beginning January 1, 1993, no Medicare-related
coverage may be offered, issued, sold, or renewed to a Minnesota resident, except at the
community rate required by this subdivision. The same community rate must apply to newly
issued coverage and to renewal coverage.
For coverage that supplements Medicare and for the Part A rate calculation for plans
governed by section 1833 of the federal Social Security Act, United States Code, title 42, section
1395, et seq., the community rate may take into account only the following factors:
(1) actuarially valid differences in benefit designs or provider networks;
(2) geographic variations in rates if preapproved by the commissioner of commerce; and
(3) premium reductions in recognition of healthy lifestyle behaviors, including but not
limited to, refraining from the use of tobacco. Premium reductions must be actuarially valid
and must relate only to those healthy lifestyle behaviors that have a proven positive impact on
health. Factors used by the health carrier making this premium reduction must be filed with and
approved by the commissioner of commerce.
For insureds not residing in Anoka, Carver, Chisago, Dakota, Hennepin, Ramsey, Scott, or
Washington County, a health plan may, at the option of the health carrier, phase in compliance
under the following timetable:
(i) a premium adjustment as of March 1, 1993, that consists of one-half of the difference
between the community rate that would be applicable to the person as of March 1, 1993, and the
premium rate that would be applicable to the person as of March 1, 1993, under the rate schedule
permitted on December 31, 1992. A health plan may, at the option of the health carrier, implement
the entire premium difference described in this clause for any person as of March 1, 1993, if the
premium difference would be 15 percent or less of the premium rate that would be applicable to
the person as of March 1, 1993, under the rate schedule permitted on December 31, 1992, if the
health plan does so uniformly regardless of whether the premium difference causes premiums
to rise or to fall. The premium difference described in this clause is in addition to any premium
adjustment attributable to medical cost inflation or any other lawful factor and is intended to
describe only the premium difference attributable to the transition to the community rate; and
(ii) with respect to any person whose premium adjustment was constrained under clause
(i), a premium adjustment as of January 1, 1994, that consists of the remaining one-half of the
premium difference attributable to the transition to the community rate, as described in clause (i).
A health plan that initially follows the phase-in timetable may at any subsequent time
comply on a more rapid timetable. A health plan that is in full compliance as of January 1, 1993,
may not use the phase-in timetable and must remain in full compliance. Health plans that follow
the phase-in timetable must charge the same premium rate for newly issued coverage that they
charge for renewal coverage. A health plan whose premiums are constrained by clause (i) may
take the constraint into account in establishing its community rate.
From January 1, 1993 to February 28, 1993, a health plan may, at the health carrier's option,
charge the community rate under this paragraph or may instead charge premiums permitted
as of December 31, 1992.
    Subd. 1s. Prescription drug coverage. (a) Subject to subdivisions 1k, 1m, 1n, and 1p, a
Medicare supplement policy with benefits for outpatient prescription drugs, in existence prior to
January 1, 2006, must be renewed, at the option of the policyholder, for current policyholders
who do not enroll in Medicare Part D.
(b) A Medicare supplement policy with benefits for outpatient prescription drugs must not
be issued after December 31, 2005.
(c) After December 31, 2005, a Medicare supplement policy with benefits for outpatient
prescription drugs must not be renewed after the policyholder enrolls in Medicare Part D unless:
(1) the policy is modified to eliminate outpatient prescription drug coverage for expenses of
outpatient prescription drugs incurred on or after the effective date of the individual's coverage
under Medicare Part D; and
(2) premiums are adjusted to reflect the elimination of outpatient prescription drug coverage
at the time of Medicare Part D enrollment, accounting for any claims paid, if applicable.
(d) An issuer of a Medicare supplement policy or certificate must comply with the federal
Medicare Prescription Drug, Improvement, and Modernization Act of 2003, as amended,
including any federal regulations, as amended, adopted under that act. This paragraph does not
require compliance with any provision of that act until the date upon which that act requires
compliance with that provision. The commissioner has authority to enforce this paragraph.
    Subd. 1t. Notice of lack of drug coverage. Each policy or contract issued without
prescription drug coverage by any insurer, health service plan corporation, health maintenance
organization, or fraternal benefit society must contain, displayed prominently by type or other
appropriate means, on the first page of the contract, the following:
"Notice to buyer: This contract does not cover prescription drugs. Prescription drugs can
be a very high percentage of your medical expenses. Coverage for prescription drugs may be
available to you by retaining existing coverage you may have or by enrolling in Medicare Part
D. Please ask for further details."
    Subd. 1u. Guaranteed issue for eligible persons. (a)(1) Eligible persons are those
individuals described in paragraph (b) who seek to enroll under the policy during the period
specified in paragraph (c) and who submit evidence of the date of termination or disenrollment
described in paragraph (b), or of the date of Medicare Part D enrollment, with the application
for a Medicare supplement policy.
(2) With respect to eligible persons, an issuer shall not: deny or condition the issuance or
effectiveness of a Medicare supplement policy described in paragraph (c) that is offered and
is available for issuance to new enrollees by the issuer; discriminate in the pricing of such a
Medicare supplement policy because of health status, claims experience, receipt of health care,
medical condition, or age; or impose an exclusion of benefits based upon a preexisting condition
under such a Medicare supplement policy.
(b) An eligible person is an individual described in any of the following:
(1) the individual is enrolled under an employee welfare benefit plan that provides health
benefits that supplement the benefits under Medicare; and the plan terminates, or the plan ceases
to provide all such supplemental health benefits to the individual;
(2) the individual is enrolled with a Medicare Advantage organization under a Medicare
Advantage plan under Medicare Part C, and any of the following circumstances apply, or the
individual is 65 years of age or older and is enrolled with a Program of All-Inclusive Care for
the Elderly (PACE) provider under section 1894 of the federal Social Security Act, and there are
circumstances similar to those described in this clause that would permit discontinuance of the
individual's enrollment with the provider if the individual were enrolled in a Medicare Advantage
plan:
(i) the organization's or plan's certification under Medicare Part C has been terminated
or the organization has terminated or otherwise discontinued providing the plan in the area in
which the individual resides;
(ii) the individual is no longer eligible to elect the plan because of a change in the individual's
place of residence or other change in circumstances specified by the secretary, but not including
termination of the individual's enrollment on the basis described in section 1851(g)(3)(B) of the
federal Social Security Act, United States Code, title 42, section 1395w-21(g)(3)(b) (where the
individual has not paid premiums on a timely basis or has engaged in disruptive behavior as
specified in standards under section 1856 of the federal Social Security Act, United States Code,
title 42, section 1395w-26), or the plan is terminated for all individuals within a residence area;
(iii) the individual demonstrates, in accordance with guidelines established by the Secretary,
that:
(A) the organization offering the plan substantially violated a material provision of the
organization's contract in relation to the individual, including the failure to provide an enrollee
on a timely basis medically necessary care for which benefits are available under the plan or the
failure to provide such covered care in accordance with applicable quality standards; or
(B) the organization, or agent or other entity acting on the organization's behalf, materially
misrepresented the plan's provisions in marketing the plan to the individual; or
(iv) the individual meets such other exceptional conditions as the secretary may provide;
(3)(i) the individual is enrolled with:
(A) an eligible organization under a contract under section 1876 of the federal Social
Security Act, United States Code, title 42, section 1395mm (Medicare cost);
(B) a similar organization operating under demonstration project authority, effective for
periods before April 1, 1999;
(C) an organization under an agreement under section 1833(a)(1)(A) of the federal Social
Security Act, United States Code, title 42, section 1395l(a)(1)(A) (health care prepayment plan); or
(D) an organization under a Medicare Select policy under section 62A.318 or the similar law
of another state; and
(ii) the enrollment ceases under the same circumstances that would permit discontinuance of
an individual's election of coverage under clause (2);
(4) the individual is enrolled under a Medicare supplement policy, and the enrollment
ceases because:
(i)(A) of the insolvency of the issuer or bankruptcy of the nonissuer organization; or
(B) of other involuntary termination of coverage or enrollment under the policy;
(ii) the issuer of the policy substantially violated a material provision of the policy; or
(iii) the issuer, or an agent or other entity acting on the issuer's behalf, materially
misrepresented the policy's provisions in marketing the policy to the individual;
(5)(i) the individual was enrolled under a Medicare supplement policy and terminates that
enrollment and subsequently enrolls, for the first time, with any Medicare Advantage organization
under a Medicare Advantage plan under Medicare Part C; any eligible organization under a
contract under section 1876 of the federal Social Security Act, United States Code, title 42,
section 1395mm (Medicare cost); any similar organization operating under demonstration project
authority; any PACE provider under section 1894 of the federal Social Security Act, or a Medicare
Select policy under section 62A.318 or the similar law of another state; and
(ii) the subsequent enrollment under item (i) is terminated by the enrollee during any period
within the first 12 months of the subsequent enrollment during which the enrollee is permitted to
terminate the subsequent enrollment under section 1851(e) of the federal Social Security Act;
(6) the individual, upon first enrolling for benefits under Medicare Part B, enrolls in a
Medicare Advantage plan under Medicare Part C, or with a PACE provider under section 1894 of
the federal Social Security Act, and disenrolls from the plan by not later than 12 months after
the effective date of enrollment; or
(7) the individual enrolls in a Medicare Part D plan during the initial Part D enrollment
period, as defined under United States Code, title 42, section 1395ss(v)(6)(D), and, at the time of
enrollment in Part D, was enrolled under a Medicare supplement policy that covers outpatient
prescription drugs and the individual terminates enrollment in the Medicare supplement policy
and submits evidence of enrollment in Medicare Part D along with the application for a policy
described in paragraph (e), clause (4).
(c)(1) In the case of an individual described in paragraph (b), clause (1), the guaranteed
issue period begins on the later of: (i) the date the individual receives a notice of termination or
cessation of all supplemental health benefits or, if a notice is not received, notice that a claim has
been denied because of a termination or cessation; or (ii) the date that the applicable coverage
terminates or ceases; and ends 63 days after the later of those two dates.
(2) In the case of an individual described in paragraph (b), clause (2), (3), (5), or (6), whose
enrollment is terminated involuntarily, the guaranteed issue period begins on the date that the
individual receives a notice of termination and ends 63 days after the date the applicable coverage
is terminated.
(3) In the case of an individual described in paragraph (b), clause (4), item (i), the
guaranteed issue period begins on the earlier of: (i) the date that the individual receives a notice
of termination, a notice of the issuer's bankruptcy or insolvency, or other such similar notice if
any; and (ii) the date that the applicable coverage is terminated, and ends on the date that is 63
days after the date the coverage is terminated.
(4) In the case of an individual described in paragraph (b), clause (2), (4), (5), or (6), who
disenrolls voluntarily, the guaranteed issue period begins on the date that is 60 days before the
effective date of the disenrollment and ends on the date that is 63 days after the effective date.
(5) In the case of an individual described in paragraph (b), clause (7), the guaranteed issue
period begins on the date the individual receives notice pursuant to section 1882(v)(2)(B) of the
Social Security Act from the Medicare supplement issuer during the 60-day period immediately
preceding the initial Part D enrollment period and ends on the date that is 63 days after the
effective date of the individual's coverage under Medicare Part D.
(6) In the case of an individual described in paragraph (b) but not described in this paragraph,
the guaranteed issue period begins on the effective date of disenrollment and ends on the date that
is 63 days after the effective date.
(d)(1) In the case of an individual described in paragraph (b), clause (5), or deemed to be
so described, pursuant to this paragraph, whose enrollment with an organization or provider
described in paragraph (b), clause (5), item (i), is involuntarily terminated within the first 12
months of enrollment, and who, without an intervening enrollment, enrolls with another such
organization or provider, the subsequent enrollment is deemed to be an initial enrollment
described in paragraph (b), clause (5).
(2) In the case of an individual described in paragraph (b), clause (6), or deemed to be so
described, pursuant to this paragraph, whose enrollment with a plan or in a program described in
paragraph (b), clause (6), is involuntarily terminated within the first 12 months of enrollment, and
who, without an intervening enrollment, enrolls in another such plan or program, the subsequent
enrollment is deemed to be an initial enrollment described in paragraph (b), clause (6).
(3) For purposes of paragraph (b), clauses (5) and (6), no enrollment of an individual with
an organization or provider described in paragraph (b), clause (5), item (i), or with a plan or in
a program described in paragraph (b), clause (6), may be deemed to be an initial enrollment
under this paragraph after the two-year period beginning on the date on which the individual first
enrolled with the organization, provider, plan, or program.
(e) The Medicare supplement policy to which eligible persons are entitled under:
(1) paragraph (b), clauses (1) to (4), is any Medicare supplement policy that has a benefit
package consisting of the basic Medicare supplement plan described in section 62A.316,
paragraph (a)
, plus any combination of the three optional riders described in section 62A.316,
paragraph (b)
, clauses (1) to (3), offered by any issuer;
(2) paragraph (b), clause (5), is the same Medicare supplement policy in which the individual
was most recently previously enrolled, if available from the same issuer, or, if not so available,
any policy described in clause (1) offered by any issuer, except that after December 31, 2005, if
the individual was most recently enrolled in a Medicare supplement policy with an outpatient
prescription drug benefit, a Medicare supplement policy to which the individual is entitled under
paragraph (b), clause (5), is:
(i) the policy available from the same issuer but modified to remove outpatient prescription
drug coverage; or
(ii) at the election of the policyholder, a policy described in clause (4), except that the policy
may be one that is offered and available for issuance to new enrollees that is offered by any issuer;
(3) paragraph (b), clause (6), is any Medicare supplement policy offered by any issuer;
(4) paragraph (b), clause (7), is a Medicare supplement policy that has a benefit package
classified as a basic plan under section 62A.316 if the enrollee's existing Medicare supplement
policy is a basic plan or, if the enrollee's existing Medicare supplement policy is an extended basic
plan under section 62A.315, a basic or extended basic plan at the option of the enrollee, provided
that the policy is offered and is available for issuance to new enrollees by the same issuer that
issued the individual's Medicare supplement policy with outpatient prescription drug coverage.
The issuer must permit the enrollee to retain all optional benefits contained in the enrollee's
existing coverage, other than outpatient prescription drugs, subject to the provision that the
coverage be offered and available for issuance to new enrollees by the same issuer.
(f)(1) At the time of an event described in paragraph (b), because of which an individual
loses coverage or benefits due to the termination of a contract or agreement, policy, or plan,
the organization that terminates the contract or agreement, the issuer terminating the policy,
or the administrator of the plan being terminated, respectively, shall notify the individual of
the individual's rights under this subdivision, and of the obligations of issuers of Medicare
supplement policies under paragraph (a). The notice must be communicated contemporaneously
with the notification of termination.
(2) At the time of an event described in paragraph (b), because of which an individual ceases
enrollment under a contract or agreement, policy, or plan, the organization that offers the contract
or agreement, regardless of the basis for the cessation of enrollment, the issuer offering the
policy, or the administrator of the plan, respectively, shall notify the individual of the individual's
rights under this subdivision, and of the obligations of issuers of Medicare supplement policies
under paragraph (a). The notice must be communicated within ten working days of the issuer
receiving notification of disenrollment.
(g) Reference in this subdivision to a situation in which, or to a basis upon which, an
individual's coverage has been terminated does not provide authority under the laws of this state
for the termination in that situation or upon that basis.
(h) An individual's rights under this subdivision are in addition to, and do not modify or
limit, the individual's rights under subdivision 1h.
    Subd. 2. General coverage. For a policy to meet the requirements of this section and section
62A.3099 it must contain (1) a designation specifying whether the policy is an extended basic
Medicare supplement plan or a basic Medicare supplement plan, (2) a caption stating that the
commissioner has established two categories of Medicare supplement insurance and minimum
standards for each, with the extended basic Medicare supplement being the most comprehensive
and the basic Medicare supplement being the least comprehensive, and (3) the policy must
provide the coverage prescribed in sections 62A.315 and 62A.316.
    Subd. 3.[Renumbered 62A.3099]
    Subd. 4. Prohibited policy provisions. (a) A Medicare supplement policy or certificate in
force in the state shall not contain benefits that duplicate benefits provided by Medicare or contain
exclusions on coverage that are more restrictive than those of Medicare. Duplication of benefits
is permitted to the extent permitted under subdivision 1s, paragraph (a), for benefits provided
by Medicare Part D.
(b) No Medicare supplement policy or certificate may use waivers to exclude, limit, or
reduce coverage or benefits for specifically named or described preexisting diseases or physical
conditions, except as permitted under subdivision 1b.
    Subd. 5. Advertising. An issuer shall provide a copy of any Medicare supplement
advertisement intended for use in this state whether through printed or electronic medium to the
commissioner for review or approval to the extent it may be required.
    Subd. 6. Application to certain policies. The requirements of sections 62A.3099 to 62A.44
shall not apply to disability income protection insurance policies, long-term care policies issued
pursuant to sections 62A.46 to 62A.56 or chapter 62S, or group policies of accident and health
insurance which do not purport to supplement Medicare issued to any of the following groups:
(a) A policy issued to an employer or employers or to the trustee of a fund established
by an employer where only employees or retirees, and dependents of employees or retirees,
are eligible for coverage.
(b) A policy issued to a labor union or similar employee organization.
(c) A policy issued to an association, a trust or the trustee of a fund established, created or
maintained for the benefit of members of one or more associations. The association or associations
shall have at the outset a minimum of 100 persons; shall have been organized and maintained in
good faith for purposes other than that of obtaining insurance; shall have a constitution and bylaws
which provide that (1) the association or associations hold regular meetings not less frequently
than annually to further purposes of the members, (2) except for credit unions, the association or
associations collect dues or solicit contributions from members, (3) the members have voting
privileges and representation on the governing board and committees, and (4) the members are
not, within the first 30 days of membership, directly solicited, offered, or sold a long-term care
policy or Medicare supplement policy if the policy is available as an association benefit. This
clause does not prohibit direct solicitations, offers, or sales made exclusively by mail.
An association may apply to the commissioner for a waiver of the 30-day waiting period as
to that association. The commissioner may grant the waiver upon a finding of all of the following:
(1) that the association is in full compliance with this section; (2) that sanctions have not been
imposed against the association as a result of significant disciplinary action by the Department
of Commerce; and (3) that at least 90 percent of the association's income comes from dues,
contributions, or sources other than income from the sale of insurance.
    Subd. 7. Medicare prescription drug benefit. If Congress enacts legislation creating a
prescription drug benefit in the Medicare program, nothing in this section or any other section
shall prohibit an issuer of a Medicare supplement policy from offering this prescription drug
benefit consistent with the applicable federal law or regulations.
History: 1981 c 318 s 1; 1983 c 263 s 10; 1986 c 397 s 2; 1987 c 337 s 55; 1989 c 258 s 3,4;
1990 c 403 s 3; 1990 c 415 s 3; 1991 c 43 s 1; 1991 c 129 s 1; 1992 c 549 art 3 s 11; 1992 c 554 art
1 s 1-3; 1993 c 1 s 1; 1993 c 330 s 1-3,12; 1994 c 465 art 1 s 2; 1994 c 625 art 10 s 6; 1995 c 258
s 29,30; 1996 c 446 art 1 s 27-31; 1997 c 71 art 2 s 4; 1999 c 90 s 1-3; 2001 c 215 s 13-15; 2002
c 277 s 32; 2002 c 330 s 11; 1Sp2003 c 14 art 7 s 2-4; 2005 c 17 art 1 s 1-9,14; 2005 c 132 s 10

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