3901-4-02 Long-term care partnership program.

(A) Purpose. The purpose of this rule is to implement a state long-term care partnership program in Ohio in accordance with sections 5111.18 and 3923.41 to 3923.49 of the Revised Code.

(B) Authority. This rule is issued pursuant to the authority vested in the superintendent under sections 3901.041, 3923.44 and 3923.47 of the Revised Code.

(C) Applicability. This rule applies to long-term care insurance that is intended to qualify under the state’s long-term care partnership program.

(D) Definitions. For purposes of this rule, the definitions set forth in section 3923.41 of the Revised Code and rule 3901-4-01 of the Administrative Code shall have the same meaning as if such definitions were fully set forth herein. The term “policy” shall also include a certificate issued as evidence of coverage under a group insurance policy.

(E) Offers of exchange.

(1) Within one hundred eighty days of the date that an insurer begins to advertise, market, offer, sell or issue policies that qualify under the state long-term care partnership program, the insurer shall offer, on a one time basis, in writing, to all existing policyholders and certificate holders that were issued long-term care coverage by the insurer on or after August 12, 2002, the option to exchange their existing long-term care coverage for coverage that is intended to qualify under the state’s long-term care partnership program (partnership plan). The written offer of exchange shall include a long-term care partnership program exchange notification, appendix A, to this rule, or a form that is substantially similar in content.

(2) An exchange occurs when an insurer offers a policyholder or certificate holder (hereinafter “insured”) the option to replace an existing long-term care insurance policy with a policy that qualifies as a partnership plan, and the insured accepts the offer to terminate the existing policy and accepts the new policy. In making an offer to exchange, an insurer shall comply with all of the following requirements:

(a) The offer shall be made on a nondiscriminatory basis without regard to the age or health status of the insured;

(b) The offer shall remain open for a minimum of ninety days from the date of mailing by the insurer; and

(c) At the time the offer is made, the insurer shall provide the insured a copy of appendix A, of this rule or a form that is substantially similar in content.

(3) Notwithstanding paragraphs (E)(1) and (E)(2) of this rule,

(a) An offer to exchange may be deferred for any insured who is currently eligible for benefits under an existing policy or who is subject to an elimination period on a claim, but such deferral shall continue only as long as such eligibility or elimination period exists; and

(b) An offer to exchange does not have to be made if the insured would be required to purchase additional benefits to qualify for the state long-term care partnership program and the insured is not eligible to purchase the additional benefits under the insurer’s new business, long-term care, underwriting guidelines.

(4) If the new policy has an actuarial value of benefits equal to or lesser than the actuarial value of benefits of the existing policy, then all of the following apply:

(a) The new policy shall not be underwritten; and

(b) The rate charged for the new policy shall be determined using the original issue age and risk class of the insured that was used to determine the rate of the existing policy.

(5) If the new policy has an actuarial value of benefits exceeding the actuarial value of the benefits of the existing policy, then all of the following apply:

(a) The insurer shall apply its new business, long-term care, underwriting guidelines to the increased benefits only; and

(b) The rate charged for the new policy shall be determined using the method set forth in paragraph (E)(4)(b) of this rule for the existing benefits, increased by the rate for the increased benefits using the then current attained age and risk class of the insured for the increased benefits only.

(6) The new policy offered in an exchange shall be on a form that is currently offered for sale by the insurer in the general market and the effective date of the partnership plan policy shall be the same as the new policy.

(7) In the event of an exchange, the insured shall not lose any rights, benefits or built-up value that has accrued under the original policy with respect to the benefits provided under the original policy, including, but not limited to, rights established because of the lapse of time related to pre-existing condition exclusions, elimination periods, or incontestability clauses.

(8) Insurers may complete an exchange by either issuing a new policy or by amending an existing policy with an endorsement or rider.

(9) The requirements of rule 3901-4-01 of the Administrative Code shall apply to exchanges including, but not limited to, the requirements relating to replacements and suitability.

(10) For those insureds with long-term care policies issued before August 12, 2002, any insurer may offer any insured an option to exchange an existing policy for a policy that qualifies as a state long-term partnership plan. The requirements set forth in paragraphs (E)(2) to (E)(9) shall apply to any such exchange.

(F) Filing requirements for long-term care insurance partnership program policies.

(1) Any policy that is intended to qualify as a partnership plan must be filed with the superintendent in accordance with section 3923.02 of the Revised Code prior to use, and such filing shall include the partnership program certification form attached as appendix B to this rule, signed by an officer of the company.

(2) Insurers intending to make use of a previously filed qualifying partnership policy shall submit to the superintendent a partnership program certification form (appendix B to this rule) signed by an officer of the company with respect to each such policy form filed. For each policy form, the partnership program certification form (appendix B to this rule) shall identify the policy by the original form number and filing date.

(3) If an insurer intends to amend a previously filed policy with an endorsement or rider in order to bring the policy into compliance with the partnership program, the insurer shall file the endorsement or rider with the superintendent prior to use, and the filing shall include a partnership program certification form (appendix B to this rule) signed by an officer of the company for each policy to be amended by the endorsement or rider, which shall include the original form number and filing date of the previously filed policy.

(4) Insurers using appendix A, or appendix C to this rule do not have to file the forms with the superintendent before use. However, if the insurer modifies the content of appendix A, or appendix C to this rule or intends to use another form, even though substantially similar in content, the form must be filed with the superintendent before use.

(G) The partnership program disclosure form.

For policies intended to qualify under the partnership program,

(1) the agent or insurer shall give the consumer a partnership disclosure notice, either using appendix C to this rule or a notice substantially similar in content, along with the outline of coverage required by division (I) of section 3923.44 of the Revised Code at the time of solicitation;

(2) In the case of a policy issued to a group where an outline of coverage is not delivered, the agent or insurer shall deliver copies of a partnership disclosure notice, either using appendix C to this rule or a notice substantially similar in content, along with the enrollment forms; or

(3) In the case of a life insurance policy that offers long-term care insurance as a term of the policy or in a rider, the agent or insurer shall give the consumer a partnership disclosure notice, either using appendix C to this rule or a notice substantially similar in content, along with the policy summary at the time of solicitation.

(4) In addition to assuring that either a copy of appendix C to this rule or a notice substantially similar in content is provided to the consumer at the time of the initial solicitation, or to the group at the time the enrollment forms are delivered, the insurer shall also assure that a copy of appendix C to this rule or a notice substantially similar in content, is provided no later than partnership policy delivery.

(H) Data reporting.

Each insurer offering partnership program policies in this state shall make regular reports to the United States secretary of health and human services that include such information as required by law or as the secretary determines is appropriate for the administration of the partnership program.

Appendix A

Date

Company name

Address

Contact information

Other company identifiers

Insured’s name

Address

Insured’s policy/certificate number

Effective date/policy issue date

“The Long-Term Care Partnership Exchange Notification Form”

Our company participates in Ohio’s long-term care partnership program by offering longterm care insurance policies that meet certain state and federal requirements. Under the partnership program, policies that meet these requirements may allow you to protect a portion of your assets from medicaid’s “spend down” requirements if you should ever need to apply for medicaid benefits to pay for long-term care expenses in the future. Partnership program policies may allow you to keep a dollar of your own assets for every dollar of benefits paid by the policy for long-term care services should you need to apply for medicaid.

Although we sell long-term care insurance policies that qualify as partnership plan policies, the policy you currently have with us does not qualify for the partnership program. Therefore, we are notifying you that you may be able to exchange your current long-term care policy for a new policy that qualifies under the partnership program.

However, before you consider exchanging your current long-term care policy for a policy that qualifies under the partnership program, there are several things you should know:

1. You may be required to answer health questions that will determine whether we will issue you a new policy (medical underwriting).

2. Since your current policy may be out of date and, therefore, does not qualify as a partnership plan policy, you may be required to update your plan by adding benefits. Carefully consider any change in benefits that may increase your costs.

3. The premium for the new policy may higher than the premium you pay for your existing policy.

4. If you move to a state that does not maintain a partnership program or does not recognize your plan as a partnership plan, you would not receive the asset protection under the medicaid laws of that state.

5. Since the partnership program is based on current federal and state laws, it is subject to change. If the laws are changed, the partnership plan policies may not offer the same protections in the future as they do now.

If you would like more information about this offer to exchange your existing long-term care insurance policy for a policy that qualifies under the state’s partnership program, please call us at____________________________________ or write to us at:_________________________________________________________________.

If, after you learn more about the partnership plan and any additional costs or benefit updates that may be required, and you decide to accept the offer to exchange your existing policy for a new, partnership plan policy, we may ask you to complete certain requirements before determining whether we can issue you a policy, such as completing an application and providing medical records.

Once you know all the additional costs, if any, and we have determined that you qualify for any additional benefits that may be required, in order to effect the completion of the exchange of your old long-term care policy for a new, partnership policy, we may send you a new policy or new certificate or we may send you an endorsement or rider that will amend your existing policy so that it qualifies under the state’s long-term care partnership program.

If you have general questions about Ohio’s long-term care partnership program and medicaid, please call the Ohio medicaid office at _______________________________.

If you have questions about long-term care insurance in general, please call the Ohio department of insurance at ___________________________________.

Appendix B

“Partnership Program Policy Certification Form”

DIRECTIONS: This certification must be completed and submitted with each long-term care policy or certificate that is intended to qualify under the state long-term care partnership program. The certification must be signed by an officer of the company with authority to bind the company. A separate certification must be completed for each policy form. A long-term care policy or certificate may not be issued in Ohio as a partnership program policy or certificate unless and until this certification has been submitted to the department of insurance and the policy or certificate has been filed for use with the department of insurance.

For newly-filed policy forms intended to qualify for the partnership program, this certification must be filed as part of the policy form filing. With respect to a previously filed form that qualifies for the partnership program, this certification shall be filed with the department identifying by form number and filing date the previously filed form. If an insurer is filing an endorsement or rider to amend a previously filed form in order to make the form compliant with the partnership program, this Certification must be filed with the endorsement or rider filing, and must identify the previously filed form by form number and filing date.

CERTIFICATION

Under Section 1917(b)(5)(B)(iii) of the Social Security Act (42 U.S.C. 1396p(b)(5)(B)(iii)) and in accordance with sections 3901-4-01 and 3901-4-02 of the Ohio Admin. Code, the following insurer ________________________________ (name) hereby submits information related to policy or certificate form _____________________ (form number) filed on __________________ (date) to substantiate that the form includes all consumer protection requirements set forth in section 1917(b)(5)(A) of the Social Security Act (42 U.S.C. 1396p(b)(5)(A)) and that it includes certain specified provisions of the Long-Term Care Insurance Model Regulation and Long-Term Care nsurance Model Act promulgated by the National Association of Insurance Commissioners (NAIC), as adopted as of October 2000, hereinafter referred to herein as the “Model Regulation” and “Model Act,” respectively, which have been incorporated into Ohio law as provided for in sections 3923.41 to 3923.49 of the Revised Code and sections 3901-4-01 and 3901-4-02 of the Ohio Admin. Code.

Part I. General Information.

A. Name, address, and telephone number of issuer: __________________________________

B. Policy form(s) covered by this certification, including the form number and filing date: __________________________________

Specimen copies of each of the above policy forms, including any riders and endorsements, shall be provided with this certification if they have not been previously filed with the Department of Insurance for use in Ohio. Policy forms that have been previously filed with the Department for use in Ohio shall be provided upon request.

Part II. Questions regarding compliance with the Model Regulation, Model Act and Ohio law.

Please answer each of the following questions with respect to the policy forms identified in Part I (B), above.

For purposes of answering the questions below, any provision of the Model Regulation and Model Act listed below shall be treated as including any other provisions of the Model Regulation and Model Act necessary to implement the provision.

In order for a policy to qualify as a Long-Term Care Insurance Partnership Program Policy, the answers to all questions below should be “Yes” (or “N/A” where all requirements with respect to a provision cited herein are not applicable). If answers differ between policy forms (e.g., a requirement would be answered “Yes” for one form and “N/A” for another), you should use separate Certification for such policies.

(1) Do each of the policies identified in Part I(B) above (including certificates issued under a group insurance contract) comply with the following requirements of the Model Regulation, as contained in section 3901-4-01 of the Ohio Admin. Code?

Yes ___ No ___ N/A ___ A. Section 6A (relating to guaranteed renewal or noncancellability), other than paragraph (5) thereof, and the requirements of section 6B of the Model Act. (Section 3901-4-01(F)(1) of the Ohio Admin. Code; and section 3923.44(B) of the Revised Code.)

Yes ___ No ___ N/A ___ B. Section 6B (relating to prohibitions on limitations and exclusions) other than paragraph (7) thereof. (Section 3901-4-01(F)(2) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ C. Section 6C (relating to extension of benefits). (Section 3901-4-01(F)(3) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ D. Section 6D (relating to continuation or conversion of coverage). (Section 3901-4-01(F)(4) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ E. Section 6E (relating to discontinuance and replacement of policies). (Section 3901-4-01(F)(5) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ F. Section 7 (relating to unintentional lapse). (Section 3901-4-01(G) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ G. Section 8 (relating to disclosure), other than sections 8F, 8G, 8H, and 8I thereof. (Section 3901-4-01(H) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ H. Section 9 (relating to required disclosure of rating practices to consumer). (Section 3901-4-01(I) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ I. Section 11 (relating to prohibitions against post-claims underwriting). (Section 3901-4-01(K) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ J. Section 12 (relating to minimum standards). (Section 3901-4-01(L) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ K. Section 14 (relating to application forms and replacement coverage). (Section 3901-4-01(N) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ L. Section 15 (relating to reporting requirements). (Section 3901-4-01(O) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ M. Section 22 (relating to filing requirements for marketing). (Section 3901-4-01(U) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ N. Section 23 (relating to standards for marketing), including inaccurate completion of medical histories, other than paragraphs (1), (6), and (9) of section 23C. (Section 3901-4-01(V) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ O. Section 24 (relating to suitability). (Section 3901-4-01(W) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ P. Section 25 (relating to prohibition against preexisting conditions and probationary periods in replacement policies or certificates). (Section 3901-4-01(X) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ Q. The provisions of section 26 relating to contingent nonforfeiture benefits. (Section 3901-4-01(Y) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ R. Section 29 (relating to standard format outline of coverage). (Section 3901-4-01(BB) of the Ohio Admin. Code.)

Yes ___ No ___ N/A ___ S. Section 30 (relating to requirement to deliver shopper’s guide). (Section 3901-4-01(CC) of the Ohio Admin. Code.)

(2) Do each of the policies identified in Part I(B) above (including certificates issued under a group insurance contract) comply with the following requirements of the Model Act?

Yes ___ No ___ N/A ___ A. Section 6C (relating to preexisting conditions). (Sections 3923.44(B), (C) and (D) of the Revised Code.)

Yes ___ No ___ N/A ___ B. Section 6D (relating to prior hospitalization). (Sections 3923.44(E) and (F) of the Revised Code.)

Yes ___ No ___ N/A ___ C. The provisions of section 8 relating to contingent nonforfeiture benefits. (Section 3923.442 of the Revised Code.)

Yes ___ No ___ N/A ___ D. Section 6F (relating to right to return). (Section 3923.44(H) of the Revised Code.)

Yes ___ No ___ N/A ___ E. Section 6G (relating to outline of coverage). (Section 3923.44(I) and (M) of the Revised Code.)

Yes ___ No ___ N/A ___ F. Section 6H (relating to requirements for certificates under group plans.) (Section 3923.44(J) of the Revised Code.)

Yes ___ No ___ N/A ___ G. Section 6J (relating to policy summary). (Section 3923.44(K) of the Revised Code.)

Yes ___ No ___ N/A ___ H. Section 6K (relating to monthly reports on accelerated death benefits). (Section 3923.44(L) of the Revised Code.)

Yes ___ No ___ N/A ___ I. Section 7 (relating to incontestability period.) (Section 3924.441 of the Revised Code.)

Part III. Inflation Protection.

Yes ___ No ___ Do each of the policies identified in Part I(B) above (including certificates issued under a group insurance contract) comply with the partnership program inflation protection requirements of sections 3923.44(O), (P) and (Q) of the Revised Code.)

Part IV. Certification.

As an officer of the insurer, I hereby certify that the answers, accompanying documents, and other information set forth herein for certification of the listed policy form or forms are to the best of my knowledge and belief, true, correct, and complete and that the policies identified in this form meet all of the consumer protection requirements pertaining to long-term care insurance partnership policies for the State of Ohio. I understand that false, inaccurate or incomplete information on this form or accompanying documents may result in disapproval of listed policies for use in Ohio and other administrative sanctions.

Signature Date:

Insurer contact:

Name of Certifying Officer: _________________________________________

Title of Certifying Officer: _________________________________________

Name of Company Contact _________________________________________

(If other than certifying officer)

Phone Number: _________________________________________

Fax Number: _________________________________________

E-mail Address: _________________________________________

Mailing Address: _________________________________________

Appendix C

Date

Company name

Address

Contact information

Other company identifiers

Insured’s name

Address

Insured’s policy/certificate number

Effective date/policy issue date

“Ohio’s Long-Term Care Insurance Partnership Disclosure Notice”

Note: Please keep a copy of this notice

Partnership policy status.

Insurance companies can voluntarily agree to participate in the Ohio long-term care insurance partnership program by offering long-term care insurance policies that meet certain state and federal requirements (partnership plan). Our company has chosen to participate in this program. Therefore, the longterm care insurance policy you are considering purchasing or have purchased qualifies as a partnership plan.

What does this mean to you?

Under the partnership program, if you own a long-term care insurance policy that qualifies as a partnership plan, you may be able to protect some of your assets from medicaid’s “spend down” requirements if you should ever have to apply for medicaid benefits. For example, if you have a policy that qualifies as a partnership plan, you may be able to shield one dollar of your assets under medicaid for every dollar of benefits the policy pays for your long-term care. Please note that the purchase of a partnership plan does not automatically qualify you to receive benefits under medicaid. Medicaid has certain requirements that must be met in order to receive benefits under a state medicaid program.

What could disqualify a plan as a partnership plan?

If any changes are made to the plan once it has been purchased, these changes could affect whether the plan will continue to be qualified as a partnership plan. Therefore, if you purchase a partnership plan or have purchased one, before you make any change to the plan (e.g., decrease the level of benefits), you should consult with us to determine the effect of the proposed change. In addition, if you should move to a state that does not maintain a partnership program or does not recognize the policy as a qualified partnership plan under the laws of that state, any payment of long-term care benefits under the policy would not protect your assets under the medicaid program.

State and federal law governing partnership plan policies

The information contained in this notice is based on current Ohio and federal laws. However, please be aware that these laws are subject to change at any time in the future, which changes could result in the modification, reduction or even the elimination of the medicaid-asset protection feature.

Questions?

Should you have questions regarding the long-term care insurance partnership program policy you are considering purchasing or have purchased, please contact at_________________________.

If you have general questions about Ohio’s partnership program and how it works with Ohio’s medicaid laws, please call the Ohio medicaid office at _____________________.

If you have questions about long-term care insurance in general, please call the Ohio department of insurance at ___________________________________.

Effective: 09/10/2007

R.C. 119.032 review dates: 12/23/2008

Promulgated Under: 119.03

Statutory Authority: 3901.041, 3923.44, 3923.47

Rule Amplifies: 3901.41 to 3901.49