Chapter 3924: SMALL EMPLOYER HEALTH BENEFIT PLANS; PROVISION OF HEALTH CARE COVERAGE

3924.01 Small employer health benefit plans - provision of health care coverage definitions.

As used in sections 3924.01 to 3924.14 of the Revised Code:

(A) "Actuarial certification" means a written statement prepared by a member of the American academy of actuaries, or by any other person acceptable to the superintendent of insurance, that states that, based upon the person's examination, a carrier offering health benefit plans to small employers is in compliance with sections 3924.01 to 3924.14 of the Revised Code. "Actuarial certification" shall include a review of the appropriate records of, and the actuarial assumptions and methods used by, the carrier relative to establishing premium rates for the health benefit plans.

(B) "Adjusted average market premium price" means the average market premium price as determined by the board of directors of the Ohio health reinsurance program either on the basis of the arithmetic mean of all carriers' premium rates for an OHC plan sold to groups with similar case characteristics by all carriers selling OHC plans in the state, or on any other equitable basis determined by the board.

(C) "Base premium rate" means, as to any health benefit plan that is issued by a carrier and that covers at least two but no more than fifty employees of a small employer, the lowest premium rate for a new or existing business prescribed by the carrier for the same or similar coverage under a plan or arrangement covering any small employer with similar case characteristics.

(D) "Carrier" means any sickness and accident insurance company or health insuring corporation authorized to issue health benefit plans in this state or a MEWA. A sickness and accident insurance company that owns or operates a health insuring corporation, either as a separate corporation or as a line of business, shall be considered as a separate carrier from that health insuring corporation for purposes of sections 3924.01 to 3924.14 of the Revised Code.

(E) "Case characteristics" means, with respect to a small employer, the geographic area in which the employees work; the age and sex of the individual employees and their dependents; the appropriate industry classification as determined by the carrier; the number of employees and dependents; and such other objective criteria as may be established by the carrier. "Case characteristics" does not include claims experience, health status, or duration of coverage from the date of issue.

(F) "Dependent" means the spouse or child of an eligible employee, subject to applicable terms of the health benefits plan covering the employee.

(G) "Eligible employee" means an employee who works a normal work week of twenty-five or more hours. "Eligible employee" does not include a temporary or substitute employee, or a seasonal employee who works only part of the calendar year on the basis of natural or suitable times or circumstances.

(H) "Health benefit plan" means any hospital or medical expense policy or certificate or any health plan provided by a carrier, that is delivered, issued for delivery, renewed, or used in this state on or after the date occurring six months after November 24, 1995. "Health benefit plan" does not include policies covering only accident, credit, dental, disability income, long-term care, hospital indemnity, medicare supplement, specified disease, or vision care; coverage under a one-time-limited-duration policy of no longer than six months; coverage issued as a supplement to liability insurance; insurance arising out of a workers' compensation or similar law; automobile medical-payment insurance; or insurance under which benefits are payable with or without regard to fault and which is statutorily required to be contained in any liability insurance policy or equivalent self-insurance.

(I) "Late enrollee" means an eligible employee or dependent who enrolls in a small employer's health benefit plan other than during the first period in which the employee or dependent is eligible to enroll under the plan or during a special enrollment period described in section 2701(f) of the "Health Insurance Portability and Accountability Act of 1996," Pub. L. No. 104-191 , 110 Stat. 1955, 42 U.S.C.A. 300gg, as amended.

(J) "MEWA" means any "multiple employer welfare arrangement" as defined in section 3 of the "Federal Employee Retirement Income Security Act of 1974," 88 Stat. 832, 29 U.S.C.A. 1001, as amended, except for any arrangement which is fully insured as defined in division (b)(6)(D) of section 514 of that act.

(K) "Midpoint rate" means, for small employers with similar case characteristics and plan designs and as determined by the applicable carrier for a rating period, the arithmetic average of the applicable base premium rate and the corresponding highest premium rate.

(L) "Pre-existing conditions provision" means a policy provision that excludes or limits coverage for charges or expenses incurred during a specified period following the insured's enrollment date as to a condition for which medical advice, diagnosis, care, or treatment was recommended or received during a specified period immediately preceding the enrollment date. Genetic information shall not be treated as such a condition in the absence of a diagnosis of the condition related to such information.

For purposes of this division, "enrollment date" means, with respect to an individual covered under a group health benefit plan, the date of enrollment of the individual in the plan or, if earlier, the first day of the waiting period for such enrollment.

(M) "Service waiting period" means the period of time after employment begins before an employee is eligible to be covered for benefits under the terms of any applicable health benefit plan offered by the small employer.

(N)

(1) "Small employer" means, in connection with a group health benefit plan and with respect to a calendar year and a plan year, an employer who employed an average of at least two but no more than fifty eligible employees on business days during the preceding calendar year and who employs at least two employees on the first day of the plan year.

(2) For purposes of division (N)(1) of this section, all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended, shall be considered one employer. In the case of an employer that was not in existence throughout the preceding calendar year, the determination of whether the employer is a small or large employer shall be based on the average number of eligible employees that it is reasonably expected the employer will employ on business days in the current calendar year. Any reference in division (N) of this section to an "employer" includes any predecessor of the employer. Except as otherwise specifically provided, provisions of sections 3924.01 to 3924.14 of the Revised Code that apply to a small employer that has a health benefit plan shall continue to apply until the plan anniversary following the date the employer no longer meets the requirements of this division.

(O) "OHC plan" means an Ohio health care plan, which is the basic, standard, or carrier reimbursement plan for small employers and individuals established in accordance with section 3924.10 of the Revised Code.

Amended by 128th General AssemblyFile No.18,HB 300, §1, eff. 5/26/2010.

Effective Date: 03-22-1999

3924.02 Health care benefit plans covered by chapter.

(A) An individual or group health benefit plan is subject to sections 3924.01 to 3924.14 of the Revised Code if it provides health care benefits covering at least two but no more than fifty employees of a small employer, and if it meets either of the following conditions:

(1) Any portion of the premium or benefits is paid by a small employer, or any covered individual is reimbursed, whether through wage adjustments or otherwise, by a small employer for any portion of the premium.

(2) The health benefit plan is treated by the employer or any of the covered individuals as part of a plan or program for purposes of section 106 or 162 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended.

(B) Notwithstanding division (A) of this section, divisions (D), (E)(2), (F), and (G) of section 3924.03 of the Revised Code and section 3924.04 of the Revised Code do not apply to health benefit policies that are not sold to owners of small businesses as an employment benefit plan. Such policies shall clearly state that they are not being sold as an employment benefit plan and that the owner of the business is not responsible, either directly or indirectly, for paying the premium or benefits.

(C) Every health benefit plan offered or delivered by a carrier, other than a health insuring corporation, to a small employer is subject to sections 3923.23, 3923.231, 3923.232, 3923.233, and 3923.234 of the Revised Code and any other provision of the Revised Code that requires the reimbursement, utilization, or consideration of a specific category of a licensed or certified health care practitioner.

(D) Except as expressly provided in sections 3924.01 to 3924.14 of the Revised Code, no health benefit plan offered to a small employer is subject to any of the following:

(1) Any law that would inhibit any carrier from contracting with providers or groups of providers with respect to health care services or benefits;

(2) Any law that would impose any restriction on the ability to negotiate with providers regarding the level or method of reimbursing care or services provided under the health benefit plan;

(3) Any law that would require any carrier to either include a specific provider or class of provider when contracting for health care services or benefits, or to exclude any class of provider that is generally authorized by statute to provide such care.

Effective Date: 06-30-1997

3924.03 Health benefit plans covering small employers subject to conditions.

Except as otherwise provided in section 2721 of the "Health Insurance Portability and Accountability Act of 1996," Pub. L. No. 104-191 , 110 Stat. 1955, 42 U.S.C.A. 300gg-21, as amended, health benefit plans covering small employers are subject to the following conditions, as applicable:

(A)

(1) Pre-existing conditions provisions shall not exclude or limit coverage for a period beyond twelve months, or eighteen months in the case of a late enrollee, following the individual's enrollment date and may only relate to a physical or mental condition, regardless of the cause of the condition, for which medical advice, diagnosis, care, or treatment was recommended or received within the six months immediately preceding the enrollment date.

Division (A)(1) of this section is subject to the exceptions set forth in section 2701(d) of the "Health Insurance Portability and Accountability Act of 1996."

(2) The period of any such pre-existing condition exclusion shall be reduced by the aggregate of the periods of creditable coverage, if any, applicable to the employee or dependent as of the enrollment date.

(3) A period of creditable coverage shall not be counted, with respect to enrollment of an individual under a group health benefit plan, if, after that period and before the enrollment date, there was a sixty-three-day period during all of which the individual was not covered under any creditable coverage. Subsections (c)(2) to (4) and (e) of section 2701 of the "Health Insurance Portability and Accountability Act of 1996" apply with respect to crediting previous coverage.

(4) As used in division (A) of this section:

(a) "Creditable coverage" has the same meaning as in section 2701(c)(1) of the "Health Insurance Portability and Accountability Act of 1996."

(b) "Enrollment date" means, with respect to an individual covered under a group health benefit plan, the date of enrollment of the individual in the plan or, if earlier, the first day of the waiting period for such enrollment.

(B)

(1) Except as provided in section 2712(b) to (e) of the "Health Insurance Portability and Accountability Act of 1996," if a carrier offers coverage in the small employer market in connection with a group health benefit plan, the carrier shall renew or continue in force such coverage at the option of the plan sponsor of the plan.

(2) A carrier may cancel or decide not to renew the coverage of any eligible employee or of a dependent of an eligible employee if the employee or dependent, as applicable, has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the coverage and if the cancellation or nonrenewal is not based, either directly or indirectly, on any health status-related factor in relation to the employee or dependent.

As used in division (B)(2) of this section, "health status-related factor" has the same meaning as in section 3924.031 of the Revised Code.

(C) A carrier shall not exclude any eligible employee or dependent, who would otherwise be covered under a health benefit plan, on the basis of any actual or expected health condition of the employee or dependent.

If, prior to November 24, 1995, a carrier excluded an eligible employee or dependent, other than a late enrollee, on the basis of an actual or expected health condition, the carrier shall, upon the initial renewal of the coverage on or after that date, extend coverage to the employee or dependent if all other eligibility requirements are met.

(D) No health benefit plan issued by a carrier shall limit or exclude, by use of a rider or amendment applicable to a specific individual, coverage by type of illness, treatment, medical condition, or accident, except for pre-existing conditions as permitted under division (A) of this section. If a health benefit plan that is delivered or issued for delivery prior to April 14, 1993, contains such limitations or exclusions, by use of a rider or amendment applicable to a specific individual, the plan shall eliminate the use of such riders or amendments within eighteen months after April 14, 1993.

(E)

(1) Except as provided in sections 3924.031 and 3924.032 of the Revised Code, and subject to such rules as may be adopted by the superintendent of insurance in accordance with Chapter 119. of the Revised Code, a carrier shall offer and make available every health benefit plan that it is actively marketing to every small employer that applies to the carrier for such coverage.

Division (E)(1) of this section does not apply to a health benefit plan that a carrier makes available in the small employer market only through one or more bona fide associations.

Division (E)(1) of this section shall not be construed to preclude a carrier from establishing employer contribution rules or group participation rules for the offering of coverage in connection with a group health benefit plan in the small employer market, as allowed under the law of this state. As used in division (E)(1) of this section, "employer contribution rule" means a requirement relating to the minimum level or amount of employer contribution toward the premium for enrollment of employees and dependents and "group participation rule" means a requirement relating to the minimum number of employees or dependents that must be enrolled in relation to a specified percentage or number of eligible individuals or employees of an employer.

(2) Each health benefit plan, at the time of initial group enrollment, shall make coverage available to all the eligible employees of a small employer without a service waiting period. The decision of whether to impose a service waiting period shall be made by the small employer. Such waiting periods shall not be greater than ninety days.

(3) Each health benefit plan shall provide for the special enrollment periods described in section 2701(f) of the "Health Insurance Portability and Accountability Act of 1996."

(4) At least once in every twelve-month period, a carrier shall provide to all late enrollees who are identified by the small employer, the option to enroll in the health benefit plan. The enrollment option shall be provided for a minimum period of thirty consecutive days. All delays of coverage imposed under the health benefit plan, including any pre-existing condition exclusion period, affiliation period, or service waiting period, shall begin on the date the carrier receives notice of the late enrollee's application or request for coverage, and shall run concurrently with each other.

(F) The benefit structure of any health benefit plan may, at the time of coverage renewal, be changed by the carrier to make it consistent with the benefit structure contained in health benefit plans being marketed to new small employer groups. If the health benefit plan is available in the small employer market other than only through one or more bona fide associations, the modification must be consistent with the law of this state and effective on a uniform basis among small employer group plans.

(G) A carrier may obtain any facts and information necessary to apply this section, or supply those facts and information to any other third-party payer, without the consent of the beneficiary. Each person claiming benefits under a health benefit plan shall provide any facts and information necessary to apply this section.

For purposes of this section, "bona fide association" means an association that has been actively in existence for at least five years; has been formed and maintained in good faith for purposes other than obtaining insurance; does not condition membership in the association on any health status-related factor, as defined in section 3924.031 of the Revised Code, relating to an individual, including an employee or dependent; makes health insurance coverage offered through the association available to all members regardless of any health status-related factor, as defined in section 3924.031 of the Revised Code, relating to such members or to individuals eligible for coverage through a member; does not make health insurance coverage offered through the association available other than in connection with a member of the association; and meets any other requirement imposed by the superintendent. To maintain its status as a "bona fide association," each association shall annually certify to the superintendent that it meets the requirements of this paragraph.

Effective Date: 03-22-1999

3924.031 Carrier offering health benefit plan in small employer market through network plan.

(A) As used in this section and section 3924.032 of the Revised Code:

(1) "Health status-related factor" means any of the following:

(a) Health status;

(b) Medical condition, including both physical and mental illnesses;

(d) Receipt of health care;

(e) Medical history;

(f) Genetic information;

(g) Evidence of insurability, including conditions arising out of acts of domestic violence;

(h) Disability.

(2) "Network plan" means a health benefit plan of a carrier under which the financing and delivery of medical care, including items and services paid for as medical care, are provided, in whole or in part, through a defined set of providers under contract with the carrier.

(B) If a carrier offers a health benefit plan in the small employer market through a network plan, the carrier may do both of the following:

(1) Limit the small employers that may apply for such coverage to those with eligible employees who live, work, or reside in the service area of the network plan;

(2) Within the service area of the network plan, deny the coverage to small employers if the carrier has demonstrated both of the following to the superintendent of insurance:

(a) The carrier will not have the capacity to deliver services adequately to the members of any additional groups because of the carrier's obligations to existing group contract holders and members.

(b) The carrier is applying division (B)(2) of this section uniformly to all small employers without regard to the claims experience of those employers and their eligible employees and dependents or to any health status-related factor relating to such employees and dependents.

(C) A carrier that, pursuant to division (B)(2) of this section, denies coverage to a small employer in the service area of a network plan, shall not offer coverage in the small employer market within that service area for at least one hundred eighty days after the date the coverage is denied.

Effective Date: 06-30-1997

3924.032 Refusing to issue plans in small employer market.

(A) A carrier may refuse to issue health benefit plans in the small employer market if the carrier has demonstrated both of the following to the superintendent of insurance:

(1) The carrier does not have the financial reserves necessary to underwrite additional coverage.

(2) The carrier is applying division (A) of this section uniformly to all employers in the small employer market in this state consistent with the applicable laws and rules of this state and without regard to the claims experience of those employers and their employees and dependents or to any health status-related factor relating to such employees and dependents.

(B) A carrier that, pursuant to division (A) of this section, refuses to issue health benefit plans in the small employer market, shall not offer health benefit plans in the small employer market in this state for at least one hundred eighty days after the date the coverage is denied or until the carrier has demonstrated to the superintendent that the carrier has sufficient financial reserves to underwrite additional coverage, whichever is later.

Effective Date: 06-30-1997

3924.033 Information disclosed by carrier to employer.

(A) Each carrier, in connection with the offering of a health benefit plan to a small employer, shall disclose to the employer, as part of its solicitation and sales materials, the following information:

(1) The provisions of the plan concerning the carrier's right to change premium rates and the factors that may affect changes in premium rates;

(2) The provisions of the plan relating to renewability of coverage;

(3) The provisions of the plan relating to any pre-existing condition exclusion;

(4) The benefits and premiums available under all health benefit plans for which the employer is qualified.

(B) The information described in division (A) of this section shall be provided in a manner determined to be understandable by the average small employer, and in a manner sufficient to reasonably inform a small employer regarding the employer's rights and obligations under the health benefit plan.

(C) Nothing in this section requires a carrier to disclose any information that is by law proprietary and trade secret information.

Effective Date: 03-22-1999

3924.04 Limits on premium rates - low claim rates.

(A)

(1) With respect to any health benefit plan of a carrier and except as otherwise provided in divisions (A)(2) and (3) of this section, the premium rates charged or offered for a rating period for the same or similar coverage under a health benefit plan covering any small employer with similar case characteristics shall not vary from the applicable midpoint rate by more than forty per cent of the midpoint rate, as to all health benefit plans issued on or after the effective date of this section.

(2) A carrier may apply a low claims discount not to exceed five per cent of the midpoint rate to small employers with favorable claims experience. A premium rate for a rating period may fall outside the range set forth in division (A) of this section as the result of a low claims discount.

(3) If the premium rates charged or offered for the same or similar coverage under a health benefit plan covering any small employer with similar case characteristics, as determined by the carrier, exceeds the premium rate limitations described in divisions (A)(1) and (2) of this section, any increase in premium rates for a new rating period shall not exceed the sum of both of the following:

(a) Any percentage change in the base premium rate measured from the first day of the prior rating period to the first day of the new rating period;

(b) Any adjustment due to change in case characteristics or plan design of the small employer, as determined by the carrier.

(4) For purposes of this section, a small employer carrier shall treat all health benefit plans issued or renewed in the same calendar month as having the same rating period.

(B) If a carrier utilizes industry as a case characteristic in establishing premium rates, the rate factor associated with any industry classification shall not vary by more than fifteen per cent from the arithmetic average of the rate factors associated with all industry classifications.

(C) Subject to divisions (A) and (B) of this section, any increase in premium rates for a new rating period shall not exceed any percentage change in the base premium rate measured from the first day of the prior rating period to the first day of the new rating period plus fifteen per cent, adjusted on a pro rata basis for rating periods greater or less than one year, of the base premium rate for the new rating period and any adjustments due to a change in case characteristics or plan design of the small employer, as determined by the carrier.

(D) The superintendent of insurance may adopt rules in accordance with Chapter 119. of the Revised Code that set forth alternative methods of calculating the premium rates required under this section, which methods result in premium rates that are consistent with, and meet the applicable requirements of, this section. A carrier that utilizes any such method of calculation is deemed to be in compliance with this section.

(E) If a carrier has established a separate class of business for one or more small employer health care alliances in accordance with section 1731.09 of the Revised Code, this section shall apply in accordance with section 1731.09 of the Revised Code.

Effective Date: 04-14-1993; 03-23-2007

3924.05 [Repealed].

Effective Date: 03-22-1999

3924.06 Demonstrating compliance through actuarial certification.

(A) Compliance with the underwriting and rating requirements contained in sections 3924.01 to 3924.14 of the Revised Code shall be demonstrated through actuarial certification. Carriers offering health benefit plans to small employers shall file annually with the superintendent of insurance an actuarial certification stating that the underwriting and rating methods of the carrier do all of the following:

(1) Comply with accepted actuarial practices;

(2) Are uniformly applied to health benefit plans covering small employers;

(3) Comply with the applicable provisions of sections 3924.01 to 3924.14 of the Revised Code.

(B) If a carrier has established a separate class of business for one or more small employer health care alliances in accordance with section 1731.09 of the Revised Code, this section shall apply in accordance with section 1731.09 of the Revised Code.

(C) Carriers offering health benefit plans to small employers shall file premium rates with the superintendent in accordance with section 3923.02 of the Revised Code with respect to the carrier's sickness and accident insurance policies sold to small employers and in accordance with section 1751.12 of the Revised Code with respect to the carrier's health insuring corporation policies sold to small employers.

Amended by 128th General AssemblyFile No.9,HB 1, §101.01, eff. 10/16/2009.

Effective Date: 04-14-1993; 03-23-2007

3924.07 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Ohio health reinsurance program.

(A) There is hereby established a nonprofit entity to be known as the "Ohio health reinsurance program." Any carrier issuing health benefit plans in this state on or after April 14, 1993, may be a member of the program.

(B) A carrier may elect to be a member of the program by filing a written intention to participate with the superintendent of insurance at least thirty days prior to the implementation of the program. Any carrier that does not file a written intention to participate within that time period may not participate for three years after April 14, 1993, and may file an intention to participate only at that time or on any subsequent three-year anniversary date. However, the superintendent may permit a carrier to participate in the program at other intervals for reasons based on financial solvency.

(C) The board of directors of the program may permit a carrier to participate in the program at any time for good cause shown. The board shall establish an application process for carriers seeking to change their status under this division.

Suspended by 130th General Assembly File No. 15, SB 9, §3, which provides that during the period beginning on January 1, 2014, and expiring January 1, 2018, the operation of this section is suspended. If the amendments made by 42 U.S.C. 300gg-1 and 300gg-6, regarding the requirements related to health insurance coverage, do not take effect January 1, 2014, or become ineffective prior to the expiration of the suspension on January 1, 2018, then this section, in either its present form or as later amended, again becomes operational..

Effective Date: 06-30-1997

3924.08 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Board of directors - plan of operation.

(A) The board of directors of the Ohio health reinsurance program shall consist of nine appointed members who shall serve staggered terms as determined by the initial board for its members and by the plan of operation of the program for members of subsequent boards. Within thirty days after April 14, 1993, the members of the board shall be appointed, as follows:

(1) The chairperson of the senate committee having jurisdiction over insurance shall appoint the following members:

(a) Two member carriers that are small employer carriers;

(b) One member carrier that is a health insuring corporation predominantly in the small employer market;

(2) The chairperson of the committee in the house of representatives having jurisdiction over insurance shall appoint the following members:

(a) One member carrier that is a small employer carrier;

(b) One member carrier whose principal health insurance business is in the large employer market;

(d) One representative of consumers in this state.

(3) The superintendent of insurance shall appoint a representative of a member carrier operating in the small employer market who is a fellow of the society of actuaries.

The superintendent, a member of the house of representatives appointed by the speaker of the house of representatives, and a member of the senate appointed by the president of the senate, shall be ex-officio members of the board. The membership of all boards subsequent to the initial board shall reflect the distribution described in division (A) of this section.

The chairperson of the initial board and each subsequent board shall represent a small employer member carrier and shall be elected by a majority of the voting members of the board. Each chairperson shall serve for the maximum duration established in the plan of operation.

(B) Within one hundred eighty days after the appointment of the initial board, the board shall establish a plan of operation and, thereafter, any amendments to the plan that are necessary or suitable, to assure the fair, reasonable, and equitable administration of the program. The board shall, immediately upon adoption, provide to the superintendent copies of the plan of operation and all subsequent amendments to it.

(1) The handling and accounting of assets and moneys of the program and for an annual fiscal reporting to the superintendent;

(2) Filling vacancies on the board;

(3) Selecting an administrator of the program, and setting forth the powers and duties of the administrator. The administrator may be a carrier as defined in section 3924.01 of the Revised Code or a person licensed as an administrator under Chapter 3959. of the Revised Code, or the board may, in its sole discretion, choose to serve as administrator of the program.

(4) Reinsuring risks in accordance with sections 3924.07 to 3924.14 of the Revised Code;

(5) Collecting assessments subject to section 3924.13 of the Revised Code from all members to provide for claims reinsured by the program and for administrative expenses incurred or estimated to be incurred during the period for which the assessment is made;

(6) Providing protection for carriers from the financial risk associated with small employers that present poor credit risks;

(7) Establishing standards for the coverage of small employers that have a high turnover of employees;

(8) Establishing an appeals process for carriers to seek relief when a carrier has experienced an unfair share of administrative and credit risks;

(9) Establishing the adjusted average market premium prices for use by the OHC plans for individuals, for groups of two to twenty-five employees, and for groups of twenty-six to fifty employees that are offered in the state;

(10) Establishing participation standards at issue and renewal for reinsured cases;

(11) Reinsuring risks and collecting assessments in accordance with division (G) of section 3924.11 of the Revised Code;

(12) Any additional matters as determined by the board.

Effective Date: 03-22-1999

3924.09 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] General and specific powers and authority of program.

The Ohio health reinsurance program shall have the general powers and authority granted under the laws of the state to insurance companies licensed to transact sickness and accident insurance, except the power to issue insurance. The board of directors of the program also shall have the specific authority to do all of the following:

(A) Enter into contracts as are necessary or proper to carry out the provisions and purposes of sections 3924.07 to 3924.14 of the Revised Code, including the authority to enter into contracts with similar programs of other states for the joint performance of common functions, or with persons or other organizations for the performance of administrative functions;

(B) Sue or be sued, including taking any legal actions necessary or proper for recovery of any assessments for, on behalf of, or against any program or board member;

(D) Make recommendations to the superintendent of insurance regarding the design of the OHC plans which, when offered by a carrier, are eligible for reinsurance and issue reinsurance policies in accordance with the requirements of sections 3924.07 to 3924.14 of the Revised Code;

(E) Establish rules, conditions, and procedures pertaining to the reinsurance of members' risks by the program;

(F) Establish appropriate rates, rate schedules, rate adjustments, rate classifications, and any other actuarial functions appropriate to the operation of the program;

(G) Assess members in accordance with division (G) of section 3924.11 and the provisions of section 3924.13 of the Revised Code, and make such advance interim assessments as may be reasonable and necessary for organizational and interim operating expenses. Any interim assessments shall be credited as offsets against any regular assessments due following the close of the calendar year.

(H) Appoint members to appropriate legal, actuarial, and other committees if necessary to provide technical assistance with respect to the operation of the program, policy and other contract design, and any other function within the authority of the program;

(I) Borrow money to effect the purposes of the program. Any notes or other evidence of indebtedness of the program not in default shall be legal investments for carriers and may be carried as admitted assets.

(J) Reinsure risks, collect assessments, and otherwise carry out its duties under division (G) of section 3924.11 of the Revised Code;

(K) Study the operation of the Ohio health reinsurance program and the open enrollment reinsurance program and, based on its findings, make legislative recommendations to the general assembly for improvements in the effectiveness, operation, and integrity of the programs;

(L) Design a basic and standard plan for purposes of sections 1751.16, 3923.122, and 3923.581 of the Revised Code.

Amended by 128th General AssemblyFile No.18,HB 300, §1, eff. 5/26/2010.

Effective Date: 03-22-1999

3924.10 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Recommendations regarding, analysis and adoption of OHC plans.

(A) The board of directors of the Ohio health reinsurance program may make recommendations to the superintendent of insurance, and the superintendent may adopt or amend by rule adopted in accordance with Chapter 119. of the Revised Code, the OHC basic, standard, and carrier reimbursement plans which, when offered by a carrier, are eligible for reinsurance under the program. The superintendent shall establish the form and level of coverage to be made available by carriers in their OHC plans. The plans shall include benefit levels, deductibles, coinsurance factors, exclusions, and limitations for the plans. The forms and levels of coverage shall specify which components of health benefit plans offered by a carrier may be reinsured. The OHC plans are subject to division (C) of section 3924.02 of the Revised Code and to the provisions in Chapters 1751., 1753., 3923., and any other chapter of the Revised Code that require coverage or the offer of coverage of a health care service or benefit.

(B) Prior to adopting any rule that makes changes to the OHC basic or standard plan, the superintendent shall conduct an actuarial analysis of the cost impact of the proposed rule. The plans may include cost containment features including any of the following:

(1) Utilization review of health care services, including review of the medical necessity of hospital and physician services;

(2) Case management benefit alternatives;

(3) Selective contracting with hospitals, physicians, and other health care providers;

(4) Reasonable benefit differentials applicable to participating and nonparticipating providers;

(5) Employee assistance program options that provide preventive and early intervention mental health and substance abuse services;

(6) Other provisions for the cost-effective management of the plans.

(C) OHC plans established for use by health insuring corporations shall be consistent with the basic method of operation of such corporations.

(D) Each carrier shall certify to the superintendent of insurance, in the form and manner prescribed by the superintendent, that the OHC plans filed by the carrier are in substantial compliance with the provisions of the OHC plans designed or adopted under this section. Upon receipt by the superintendent of the certification, the carrier may use the certified plans.

(E) Each carrier shall, on and after sixty days after the date that the program becomes operational and as a condition of transacting business in this state, renew coverage provided to any individual or group under its OHC plans.

(F) The OHC plans in effect as of June 1, 2009, shall remain in effect until those plans are amended or new plans are adopted in accordance with this section.

Amended by 129th General AssemblyFile No.28,HB 153, §101.01, eff. 9/29/2011.

Amended by 128th General AssemblyFile No.18,HB 300, §1, eff. 5/26/2010.

Effective Date: 03-22-1999

3924.11 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Reinsuring small employer groups or individuals.

Any member of the Ohio health reinsurance program may reinsure small employer groups or individuals in accordance with the following conditions and limitations:

(A) A small employer group or individual may be reinsured within sixty days after the commencement of the group's or individual's coverage under the plan.

(B)

(1) The carrier may reinsure either the entire eligible group or any eligible individual, in accordance with the premium rates established in section 3924.12 of the Revised Code, upon commencement of the coverage.

(2) The carrier may reinsure an eligible employee, or the dependents of an eligible employee, who were previously excluded from group coverage for medical reasons, and shall reinsure such employees or dependents within sixty days after the carrier is required to include them in the group coverage.

(D) With respect to other plans issued to small employers, the program shall reinsure the level of coverage provided up to, but not exceeding, the level of coverage provided in an OHC carrier reimbursement plan. In the coverage provided to small employers, carriers shall be required to use high-cost care management, hospital precertification techniques, and other cost containment mechanisms established by the program.

(E) A carrier may not reinsure existing business, except pursuant to division (A) of this section.

(F) If an employer group is covered under a plan other than an OHC carrier reimbursement plan and the carrier chooses to reinsure the group subsequent to the initial coverage period, or if a new individual joins the group and the carrier wants to reinsure that individual, the carrier shall not force the employer to change to an OHC carrier reimbursement plan. The carrier shall allow the employer to maintain the same benefit plan and reinsure only that portion of the plan that is consistent with an OHC carrier reimbursement plan.

(G) With respect to coverage provided to an individual acquired under section 3923.58 or a federally eligible individual acquired under section 3923.581 of the Revised Code, the following conditions and limitations apply:

(1) Within sixty days after the commencement of the initial coverage, any carrier may reinsure coverage of such an individual with the open enrollment reinsurance program in accordance with division (G) of this section. Premium rates charged for coverage reinsured by the program shall be established in accordance with section 3924.12 of the Revised Code.

(2) The board of directors of the Ohio health reinsurance program shall establish the open enrollment reinsurance fund for coverage provided under section 3923.58 of the Revised Code and, with respect to federally eligible individuals, coverage provided under section 3923.581 of the Revised Code. The fund shall be maintained separately from any reinsurance fund established for Ohio health care plans issued pursuant to sections 3924.07 to 3924.14 of the Revised Code. The board shall calculate, on a retrospective basis, the amount needed for maintenance of the open enrollment reinsurance fund and, on the basis of that calculation, shall determine the amount to be assessed each carrier that is required to provide open enrollment coverage.

Assessments shall be apportioned by the board among all carriers participating in the open enrollment reinsurance program in proportion to their respective shares of the total premiums, net of reinsurance premiums paid by a carrier for open enrollment coverage and net of reinsurance premiums paid by the carrier for all other individual health benefit plans, earned in this state from all health benefit plans covering individuals that are issued by all such carriers during the calendar year coinciding with or ending during the fiscal year of the open enrollment program, or on any other equitable basis reflecting coverage of individuals in this state as may be provided in the plan of operation adopted by the board. In no event shall the assessment of any carrier under this section exceed, on an annual basis, three per cent of its Ohio premiums for health benefit plans covering individuals as reported on its most recent annual statement filed with the superintendent of insurance.

The board shall submit its determination of the amount of the assessment to the superintendent for review of the accuracy of the calculation of the assessment. Upon approval by the superintendent, each carrier shall, within thirty days after receipt of the notice of assessment, submit the assessment to the board for purposes of the open enrollment reinsurance fund.

(3) If the assessments made and collected pursuant to division (G)(2) of this section are not sufficient to pay the claims reinsured under division (G) of this section and the allocated administrative expenses, incurred or estimated to be incurred during the period for which the assessment was made, the secretary of the board shall immediately notify the superintendent, and the superintendent shall suspend the operation of open enrollment under section 3923.58 of the Revised Code and, with respect to federally eligible individuals, under section 3923.581 of the Revised Code until the board has collected in subsequent years through assessments made pursuant to division (G)(2) of this section an amount sufficient to pay such claims and administrative expenses.

(4)

(a) Any carrier that is subject to open enrollment under section 3923.58 of the Revised Code may elect not to participate in the open enrollment reinsurance program under division (G) of this section by filing an application with the superintendent and obtaining the superintendent's approval. In determining whether to approve an application, the superintendent shall consider whether the carrier meets all of the following standards:

(i) Demonstration by the carrier of a substantial and established market presence;

(ii) Demonstrated experience in the individual market and history of rating and underwriting individual plans;

(iii) Commitment to comply with the requirements of section 3923.58 of the Revised Code;

(iv) Financial ability to assume and manage the risk of enrolling open enrollment individuals without the need for, or protection of, reinsurance.

(b) A carrier whose application for nonparticipation has been rejected by the superintendent may appeal the decision in accordance with Chapter 119. of the Revised Code. A carrier that has received approval of the superintendent not to participate in the open enrollment reinsurance program shall, on or before the first day of December, annually certify to the superintendent that it continues to meet the standards described in division (G)(4)(a) of this section.

(c) In any year subsequent to the year in which its application not to participate has been approved, a carrier may elect to participate in the open enrollment reinsurance program by giving notice to the superintendent and board on or before the thirty-first day of December. If, after a period of nonparticipation, a carrier elects to participate in the open enrollment reinsurance program, the carrier retains the risks it assumed during the period when it was not participating.

(d) The superintendent may, at any time, authorize a carrier to modify an election not to participate if the risk from the carrier's open enrollment business jeopardizes the financial condition of the carrier. If the superintendent authorizes the carrier to again participate in the open enrollment reinsurance program, the carrier shall retain the risks it assumed during the period of nonparticipation.

(5)

(a) The open enrollment reinsurance program shall be operated separately from the Ohio health reinsurance program.

(b) A carrier's election to participate in the open enrollment reinsurance program under division (G) of this section shall not be construed as an election to participate in the Ohio health reinsurance program under section 3924.07 of the Revised Code.

Effective Date: 03-22-1999

3924.111 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Deductible amount and maximum liability amount.

(A) The Ohio health reinsurance program shall not provide reinsurance for any individual reinsured under the program until five thousand dollars in benefit payments have been made by a member of the program for services provided to that individual during a calendar year, which payments would have been reimbursed through the program but for the five-thousand-dollar deductible. The member shall retain ten per cent of the next fifty thousand dollars of benefit payments made during that calendar year, and the program shall reinsure the remainder. However, a member's maximum liability under this section with respect to any one individual reinsured under the program shall not exceed ten thousand dollars in any one calendar year.

(B) The board of directors of the Ohio health reinsurance program shall periodically review the deductible amount and the maximum liability amount set forth in division (A) of this section and, considering the rate of inflation, adjust each amount as the board considers necessary.

Effective Date: 06-30-1997

3924.12 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Premium rates.

(A) Except as provided in division (B) of this section, premium rates charged for coverage reinsured by the Ohio health reinsurance program shall be established as follows:

(1) For whole group reinsurance coverage, one and one-half times the adjusted average market premium price established by the program for that classification or group with similar characteristics and coverage, with respect to the eligible employees of a small employer and their dependents, all of whose coverage is reinsured with the program, minus a ceding expense factor determined by the board of directors of the program;

(2) For individual reinsurance coverage, five times the adjusted average market premium price established by the program for an individual in that classification or group with similar characteristics and coverage, with respect to an eligible employee or the employee's dependents, minus a ceding expense factor determined by the board.

(B) Premium rates charged for reinsurance by the program to a health insuring corporation that is approved by the secretary of health and human services as a federally qualified health maintenance organization pursuant to the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 301, as amended, and as such is subject to requirements that limit the amount of risk that may be ceded to the program, may be modified to reflect the portion of risk that may be ceded to the program.

Effective Date: 06-30-1997

3924.13 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Apportioning assessments.

(A) Following the close of each calendar year, the administrator of the Ohio health reinsurance program shall determine the net premiums, the program expenses for administration, and the incurred losses, if any, for the year, taking into account investment income and other appropriate gains and losses. For purposes of this section, health benefit plan premiums earned by MEWAs shall be established by adding paid claim losses and administrative expenses of the MEWA. Health benefit plan premiums and benefits paid by a carrier that are less than an amount determined by the board of directors of the program to justify the cost of collection shall not be considered for purposes of determining assessments. For purposes of this division, "net premiums" means health benefit plan premiums, less administrative expense allowances.

(B) Any net loss for the year shall be recouped first by assessments of carriers in accordance with this division. Assessments shall be apportioned by the board among all carriers participating in the program in proportion to their respective shares of the total premiums, net of reinsurance premiums paid for coverage under this program earned in the state from health benefit plans covering small employers that are issued by participating members during the calendar year coinciding with or ending during the fiscal year of the program, or on any other equitable basis reflecting coverage of small employers as may be provided in the plan of operation. An assessment shall be made pursuant to this division against a health insuring corporation that is approved by the secretary of health and human services as a federally qualified health maintenance organization pursuant to the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 301, as amended, subject to an assessment adjustment formula adopted by the board for such health insuring corporations that recognizes the restrictions imposed on the entities by federal law. The adjustment formula shall be adopted by the board prior to the first anniversary of the program's operation. In no event shall the assessment made pursuant to this division exceed, on an annual basis, one per cent of the carrier's Ohio small employer group premium as reported on its most recent annual statement filed with the superintendent of insurance. If an excess is actuarially projected, the superintendent may take any action necessary to lower the assessment to the maximum level of one per cent.

(C) If assessments exceed actual losses and administrative expenses of the program, the excess shall be held at interest and used by the board to offset future losses or to reduce program premiums. As used in this division, "future losses" includes reserves for incurred but not reported claims.

(D) Each carrier's proportion of participation in the program shall be determined annually by the board based on annual statements and other reports deemed necessary by the board and filed by the carrier with the board. MEWAs shall report to the board claims payments made and administrative expenses incurred in this state on an annual basis on a form prescribed by the superintendent.

(E) Provision shall be made in the plan of operation for the imposition of an interest penalty for late payment of assessments.

(F) A carrier may seek from the superintendent a deferment, in whole or in part, from any assessment issued by the board. The superintendent may defer, in whole or in part, the assessment of a carrier if, in the opinion of the superintendent, payment of the assessment would endanger the carrier's ability to fulfill its contractual obligations.

(G) In the event an assessment against a carrier is deferred in whole or in part, the amount by which the assessment is deferred may be assessed against the other carriers in a manner consistent with the basis for assessments set forth in this section. In such event, the other carriers assessed shall have a claim in the amount of the assessment against the carrier receiving the deferment. The carrier receiving the deferment shall remain liable to the program for the amount deferred. The superintendent may attach appropriate conditions to any deferment.

Effective Date: 03-22-1999

3924.14 [Suspended eff. 1/1/2014 through 1/1/2018; See Note] Immunity.

Neither the participation as members of the Ohio health reinsurance program or as members of the board of directors of the program, the establishment of rates, forms, or procedures for coverage issued by the program, nor any other joint or collective action required by sections 3924.01 to 3924.14 of the Revised Code, shall be the basis of any legal action or any criminal or civil liability or penalty against the program, the board, or any of its members either jointly or separately.

Effective Date: 06-30-1997

3924.21 Overcharges.

(A) As used in this section:

(1) "Beneficiary," "hospital,"and "third-party payer" have the same meanings as in section 3901.38 of the Revised Code.

(2) "Overcharged" means charged more than the usual and customary charge, rate, or fee that is charged by the provider or hospital for a particular item or service.

(3) "Provider" has the same meaning as in section 3902.11 of the Revised Code.

(B) If a beneficiary identifies on the billing statement of a provider or hospital any item or service for which the beneficiary was overcharged by more than five hundred dollars and the beneficiary notifies the third-party payer of the error at any time after the thirty-day period immediately following the date on which the third-party payer makes payment to the provider or hospital for the item or service, the provider or hospital shall refund to the beneficiary an amount equal to fifteen per cent of the amount overcharged.

(C) A provider or hospital shall not be required to comply with division (B) of this section if, at the time the third-party payer receives notice of the overcharge from the beneficiary, the provider, hospital, or third-party payer is in the process of correcting the error and such process can be documented.

Effective Date: 07-24-2002

3924.25 Prohibiting exclusion based on health condition.

(A) As used in this section, "employer" means any person who employs an individual.

(B) No employer shall engage in any act or practice that, due solely to the actual or expected health condition of one or more individuals, excludes or causes the exclusion of any individual from coverage under an existing employer-provided policy, contract, or plan of health benefits for which the individual would otherwise be eligible.

(C) If an employer violates division (B) of this section, the prosecuting attorney of the county in which an individual who was excluded from benefits resides may commence a civil action in the court of common pleas to obtain a judgment for a civil penalty as described in this division.

If the court of common pleas determines in an action under this division that an employer violated division (B) of this section, it shall impose a civil penalty of not more than ten thousand dollars or, if the violator previously has been determined by any court of common pleas to have violated division (B) of this section, not more than twenty-five thousand dollars. Any civil penalty imposed pursuant to this division shall be deposited by the clerk of the court into the county treasury.

Effective Date: 11-24-1995

3924.27 Prohibiting premium increase on the basis of any health status-related factor.

(A) As used in this section:

(1) "Carrier," "dependent," and "health benefit plan" have the same meanings as in section 3924.01 of the Revised Code.

(2) "Health status-related factor" means any of the following:

(a) Health status;

(b) Medical condition, including both physical and mental illnesses;

(d) Receipt of health care;

(e) Medical history;

(f) Genetic information;

(g) Evidence of insurability, including conditions arising out of acts of domestic violence;

(h) Disability.

(B) No group health benefit plan, or carrier offering health insurance coverage in connection with a group health benefit plan, shall require any individual, as a condition of enrollment or continued enrollment under the plan, to pay a premium or contribution that is greater than the premium or contribution for a similarly situated individual enrolled in the plan on the basis of any health status-related factor in relation to the individual or to an individual enrolled under the plan as a dependent of the individual.

(C) Nothing in division (B) of this section shall be construed to restrict the amount that an employer may be charged for coverage under a group health benefit plan, or to prevent a group health benefit plan, and a carrier offering group health insurance coverage, from establishing premium discounts or rebates or modifying otherwise applicable copayments or deductibles in return for adherence to programs of health promotion and disease prevention.

Effective Date: 06-30-1997

3924.41 Prohibiting consideration of eligibility for medical assistance.

(A) As used in sections 3924.41 and 3924.42 of the Revised Code, "health insurer" means any sickness and accident insurer or health insuring corporation. "Health insurer" also includes any group health plan as defined in section 607 of the federal "Employee Retirement Income Security Act of 1974," 88 Stat. 832, 29 U.S.C.A. 1167.

(B) Notwithstanding any other provision of the Revised Code, no health insurer shall take into consideration the availability of, or eligibility for, the medicaid program in this state or in any other state when determining an individual's eligibility for coverage or when making payments to or on behalf of an enrollee, subscriber, policyholder, or certificate holder.

Amended by 130th General Assembly File No. 25, HB 59, §101.01, eff. 9/29/2013.

Effective Date: 06-04-1997

3924.42 Prohibiting imposing different requirements on department of job and family services.

No health insurer shall impose requirements on the department of medicaid, when it has been assigned the rights of an individual who is eligible for medicaid and who is covered under a health care policy, contract, or plan issued by the health insurer, that are different from the requirements applicable to an agent or assignee of any other individual so covered.

Amended by 130th General Assembly File No. 25, HB 59, §101.01, eff. 9/29/2013.

Effective Date: 07-01-2000

3924.46 Prohibiting denial of enrollment of certain children.

(A) As used in sections 3924.46 to 3924.49 of the Revised Code, "health insurer" has the same meaning as in section 3924.41 of the Revised Code.

(B) No health insurer shall deny enrollment of a child under the health plan of the child's parent on the basis that any of the following applies:

(1) The child was born out of wedlock.

(2) The child is not claimed as a dependent on the federal tax return of the parent.

(3) The child does not reside in the household of the parent, or in the service area of the health insurer.

Effective Date: 06-30-1994

3924.47 Duties of health insurer of noncustodial parent.

If a child has health care coverage through a health insurer of a noncustodial parent, the health insurer shall do all of the following:

(A) Provide such information to the custodial parent of the child as may be necessary for the child to obtain benefits through the coverage;

(B) Permit the custodial parent, or a provider with the approval of the custodial parent, to submit claims for covered services without the approval of the noncustodial parent;

(C) Make payment on claims submitted in accordance with division (B) of this section directly to the custodial parent, the provider, or the department of job and family services.

Effective Date: 07-01-2000

3924.48 Parent required by court or administrative order to provide health care coverage for child - duties of health insurer.

(A) If a parent of a child is required by a court or administrative order to provide health care coverage for the child, and if the parent is eligible for family health care coverage provided by a health insurer, the health insurer shall do both of the following:

(1) If the child is otherwise eligible for the coverage, permit the parent to enroll the child under the family coverage without regard to any enrollment period restrictions;

(2) If the parent is enrolled under the coverage but fails to make application to obtain coverage for the child, enroll the child under the family coverage upon application of the child's other parent or pursuant to a child support order containing provisions in compliance with sections 3119.29 to 3119.56 of the Revised Code.

(B) The health insurer shall not terminate the child's coverage unless the health insurer is provided satisfactory written evidence of either of the following:

(1) The court or administrative order is no longer in effect.

(2) The child is or will be enrolled under comparable health care coverage provided by another health insurer, which coverage will take effect not later than the effective date of the termination of the current coverage.

Effective Date: 12-13-2002

3924.49 Parent required by court or administrative order to provide health care coverage for child - duties of parent.

(A) If a parent of a child is required by a court or administrative order to provide health insurance coverage for the child, which coverage is available through an employer doing business in this state, the employer shall do all of the following:

(1) If the child is otherwise eligible for the family coverage, permit the parent to enroll the child under the coverage without regard to any enrollment period restrictions;

(3) Withhold from the employee's compensation the employee's share of premiums for the health care coverage, if any, and pay that amount to the health insurer providing the coverage;

(4) Comply with the requirements of sections 3119.36 to 3119.364 and 3119.42 of the Revised Code and any rules adopted by the department of job and family services under section 3119.51 of the Revised Code.

(B) The employer shall not terminate the child's coverage unless the employer has eliminated family coverage for all of its employees or unless the employer is provided satisfactory written evidence of either of the following:

(1) The court or administrative order is no longer in effect.

(2) The child is or will be enrolled under comparable health care coverage that will take effect not later than the effective date of the termination of the current coverage.

Effective Date: 12-13-2002

3924.51 Plan benefits for adopted children.

(A) As used in this section:

(1) "Child" means, in connection with any adoption or placement for adoption of the child, an individual who has not attained age eighteen as of the date of the adoption or placement for adoption.

(2) "Health insurer" has the same meaning as in section 3924.41 of the Revised Code.

(3) "Placement for adoption" means the assumption and retention by a person of a legal obligation for total or partial support of a child in anticipation of the adoption of the child. The child's placement with a person terminates upon the termination of that legal obligation.

(B) If an individual or group health plan of a health insurer makes coverage available for dependent children of participants or beneficiaries, the plan shall provide benefits to dependent children placed with participants or beneficiaries for adoption under the same terms and conditions as apply to the natural, dependent children of the participants and beneficiaries, irrespective of whether the adoption has become final.

(C) A health plan described in division (B) of this section shall not restrict coverage under the plan of any dependent child adopted by a participant or beneficiary, or placed with a participant or beneficiary for adoption, solely on the basis of a pre-existing condition of the child at the time that the child would otherwise become eligible for coverage under the plan, if the adoption or placement for adoption occurs while the participant or beneficiary is eligible for coverage under the plan.

Effective Date: 06-30-1997

3924.53 Coverage for person in custody or confined in jail.

(A) As used in this section:

(1) "Beneficiary" and "benefits contract" have the same meanings as in section 3901.38 of the Revised Code.

(2) "Confinement" means any period of time during which a person is in the custody or under the supervision of the department of rehabilitation and correction or is confined in a local jail, workhouse, or other correctional facility of the type described in section 307.93, 341.14, 341.19, 341.23, 753.02, 753.04, 753.16, 2301.56, or 2947.19 of the Revised Code.

(3) "Law enforcement officer" has the same meaning as in section 2901.01 of the Revised Code.

(B) Except as provided in division (C) of this section, no benefits contract shall limit or exclude coverage for the reason that the beneficiary is under confinement or is otherwise under the custody of a law enforcement officer, and a governmental entity is wholly or primarily responsible for rendering or arranging for the rendering of health care services for the beneficiary.

(C) A benefits contract may limit or exclude coverage for health care services rendered to such a beneficiary if the injury or sickness for which the services were rendered resulted from an action or omission for which the governmental entity operating the correctional facility, or the governmental entity with which the law enforcement officer is affiliated, is liable.

Effective Date: 09-06-2002

3924.61 Medical savings account definitions.

As used in sections 3924.61 to 3924.74 of the Revised Code:

(A) "Account holder" means the natural person who opens a medical savings account or on whose behalf a medical savings account is opened.

(B) "Eligible medical expense" means any expense for a service rendered by a licensed health care provider or a Christian Science practitioner, or for an article, device, or drug prescribed by a licensed health care provider or provided by a Christian Science practitioner, when intended for use in the mitigation, treatment, or prevention of disease; any amount paid for transportation to the location at which such a service is rendered; any amount paid for lodging necessitated by the receipt of care at a nonlocal hospital; or premiums paid for comprehensive sickness and accident insurance, coverage under a health care plan of a health insuring corporation organized under Chapter 1751. of the Revised Code, long-term care insurance as defined in section 3923.41 of the Revised Code, medicare supplemental coverage as defined in section 3923.33 of the Revised Code, or payments made pursuant to cost sharing agreements under comprehensive sickness and accident plans. An "eligible medical expense" does not include expenses otherwise paid or reimbursed, including medical expenses paid or reimbursed under an automobile or motor vehicle insurance policy, a workers' compensation insurance policy or plan, or an employer-sponsored health coverage policy, plan, or contract.

(C) "Dependent" has the same meaning as in section 152 of the "Internal Revenue Code of 1986," 100 Stat. 2085, 26 U.S.C.A. 1, as amended.

Effective Date: 06-30-1997

3924.62 Opening of medical savings account.

(A) A medical savings account may be opened by or on behalf of any natural person, to pay the person's eligible medical expenses and the eligible medical expenses of that person's spouse or dependent. A medical savings account may be opened by or on behalf of a person only if that person participates in a sickness or accident insurance plan, a plan offered by a health insuring corporation organized under Chapter 1751. of the Revised Code, or a self-funded, employer-sponsored health benefit plan established pursuant to the "Employee Retirement Income Security Act of 1974," 88 Stat. 832, 29 U.S.C.A. 1001, as amended. While the medical savings account is open, the account holder shall continue to participate in such a plan.

(B) A person who refuses to participate in a policy, plan, or contract of health coverage that is funded by the person's employer, and who receives additional monetary compensation by virtue of refusing that coverage, may not open a medical savings account unless the medical savings account also is sponsored by the person's employer.

Effective Date: 06-30-1997

3924.63 Owners of interest in medical savings account.

The owners of interest in a medical savings account are the account holder and the account holder's spouse and dependents. No medical savings account shall be subject to garnishment or attachment.

Effective Date: 06-30-1997

3924.64 Administration of accounts.

(A) At the time a medical savings account is opened, an administrator for the account shall be designated. If an employer opens an account for an employee, the employer may designate the administrator. If an account is opened by any person other than an employer, or if an employer chooses not to designate an administrator for an account opened for an employee, the account holder shall designate the administrator. The administrator shall manage the account in a fiduciary capacity for the benefit of the account holder.

(B) Medical savings accounts shall be administered by one of the following:

(1) A federally or state-chartered bank, savings and loan association, savings bank, or credit union;

(2) A trust company authorized to act as a fiduciary;

(3) An insurer authorized under Title XXXIX [39] of the Revised Code to engage in the business of sickness and accident insurance;

(4) A dealer or salesperson licensed under Chapter 1707. of the Revised Code;

(5) An administrator licensed under Chapter 3959. of the Revised Code;

(6) A certified public accountant;

(7) An employer that administers an employee benefit plan subject to regulation under the "Employee Retirement Income Security Act of 1974," 88 Stat. 829, 29 U.S.C.A. 1001, as amended, or that maintains medical savings accounts for its employees;

(8) Health insuring corporations organized under Chapter 1751. of the Revised Code.

(C) Each administrator shall send to the account holder, at least annually, a statement setting forth the balance remaining in the account holder's account and detailing the activity in the account since the last statement was issued. Upon an administrator's receipt of a written request from an account holder for a current statement, the administrator shall promptly send the statement to the account holder.

(D) When an account holder documents to the administrator of the account the account holder's payment of, or the account holder's obligation for, an eligible medical expense for the account holder or the account holder's spouse or dependents, the administrator shall reimburse the account holder for, or shall pay for, the eligible medical expense with funds from the account holder's account, if sufficient funds are available in the account holder's account. If there are not sufficient funds in the account to fully reimburse the account holder or pay the expenses, the administrator shall reimburse the account holder or pay the expenses using whatever funds are in the account. The reimbursement or payment shall be made within thirty days of the administrator's receipt of the documentation. At the time of making the reimbursement or payment, the administrator shall notify the account holder if the medical expense does not count toward meeting the deductible or other obligation for the receipt of benefits that is required by the insurer or other third-party payer providing health coverage to the account holder. The administrator shall keep a record of the amounts disbursed from the account for documented eligible medical expenses and of the dates on which the expenses were incurred. This record shall be made available to any sickness and accident insurer or other third-party payer providing health coverage to the account holder, for use by the insurer or third-party payer in determining whether the account holder has met the deductible or other obligation required for the receipt of benefits from the insurer or third-party payer.

(E) When an account is opened, the administrator shall give written notice to the account holder of the date of the last business day of the administrator's business year.

Effective Date: 06-30-1997

3924.65 Notice of tax status of deposits.

Each employer that opens a medical savings account for an employee shall inform the employee, in writing at the time the account is opened, of the federal and state tax status of deposits made to the account.

Effective Date: 10-01-1996

3924.66 Account deducted from Ohio adjusted gross income.

(A) In determining Ohio adjusted gross income under Chapter 5747. of the Revised Code, an account holder may deduct an amount equaling the total of the deposits that the account holder, the account holder's spouse, or the account holder's employer made to the account during the taxable year, to the extent that the funds for the deposits have not otherwise been deducted or excluded in determining the account holder's federal adjusted gross income. The amount deducted by an account holder for a taxable year shall not exceed three thousand dollars. If two married persons each have an account, each spouse may claim the deduction described in this section, and the amount deducted by each spouse shall not exceed three thousand dollars, whether the spouses file returns jointly or separately.

(B) The maximum deduction allowed under division (A) of this section shall be adjusted annually by the department of taxation to reflect increases in the consumer price index for all items for all urban consumers for the midwest region, as determined by the United States bureau of labor statistics for the period of the first day of January of the preceding calendar year to the last day of December of the preceding calendar year. The department of taxation shall determine in September of each tax year the adjustment that will be effective for the succeeding tax year. The department shall not make the adjustment in any tax year in which the maximum deduction resulting from the adjustment is less than the maximum deduction allowed for the previous tax year.

(C) In determining Ohio adjusted gross income under Chapter 5747. of the Revised Code, an account holder may deduct the investment earnings of a medical savings account from the account holder's federal adjusted gross income, to the extent that these earnings have been included in the account holder's federal adjusted gross income.

(D) In determining Ohio adjusted gross income under Chapter 5747. of the Revised Code, an account holder shall add to the account holder's federal adjusted gross income an amount equal to the sum of the amounts described in divisions (D)(1) and (2) of this section to the extent that those amounts were included in the account holder's federal adjusted gross income and previously deducted in determining the account holder's Ohio adjusted gross income. In determining the extent to which amounts withdrawn from the account shall be included in the account holder's Ohio adjusted gross income, the tax commissioner shall be guided by sections 72 and 408 of the Internal Revenue Code governing the determination of the amount of withdrawals from an individual retirement account to be included in federal gross income.

(1) Amounts withdrawn from the account during the taxable year used for any purpose other than to reimburse the account holder for, or to pay, the eligible medical expenses of the account holder or the account holder's spouse or dependents;

(2) Investment earnings during the taxable year on amounts withdrawn from the account that are described in division (D)(1) of this section.

(E) Amounts withdrawn from a medical savings account to reimburse the account holder for, or to pay, the account holder's eligible medical expenses, or the eligible medical expenses of the account holder's spouse or dependents, shall not be included in the account holder's Ohio adjusted gross income in determining taxes due under Chapter 5747. of the Revised Code.

(F) If a dependent of an account holder becomes ineligible to continue to participate in the account holder's policy, plan, or contract of health coverage, the account holder may withdraw funds from the account holder's account and use those funds to pay the premium for the first year of a policy, plan, or contract of health coverage for the dependent and to pay any deductible for the first year of that policy, plan, or contract. Funds withdrawn and used for that purpose shall not be included in the account holder's Ohio adjusted gross income in determining taxes due under Chapter 5747. of the Revised Code.

Effective Date: 09-06-2002

3924.67 Withdrawals.

An account holder may withdraw funds from the account holder's account at any time, for any purpose. However, the administrator of a medical savings account shall not disburse funds to an account holder during the year in which the funds were deposited, except to reimburse the account holder for, or pay for, a documented eligible medical expense of the account holder or the account holder's spouse or dependent.

Effective Date: 06-30-1997

3924.68 Procedure upon termination of employment.

(A) If an account holder, whose medical savings account has been opened by the account holder's employer, later ceases to be employed by that employer, the account holder may, within sixty days of the account holder's final date of employment, request in writing to the administrator of the account that the administrator continue to administer the account.

(1) If the administrator agrees to continue to administer the account, funds in the account may continue to be used to pay the eligible medical expenses of the account holder and the account holder's spouse and dependents, pursuant to sections 3924.61 to 3924.74 of the Revised Code.

If the account holder later becomes employed by a new employer that opens a new medical savings account on the account holder's behalf, the account holder may transfer any funds remaining in the account opened by the account holder's former employer to the account opened by the account holder's new employer. For purposes of determining taxes due under Chapter 5747. of the Revised Code, this transfer of funds shall not be considered a withdrawal of funds from a medical savings account, nor shall it be considered a deposit to a medical savings account.

(2) If the administrator does not agree to continue to administer the account, or if the account holder requests that the account be closed, the administrator shall close the account and mail a check or other negotiable instrument in the amount of the account balance as of that date to the account holder. The amount distributed shall be included in the account holder's Ohio adjusted gross income in determining taxes due under Chapter 5747. of the Revised Code.

(B) Within sixty days of the account holder's final date of employment, the account holder may transfer any funds remaining in the account opened by the account holder's former employer to another medical savings account owned by the account holder. For purposes of determining taxes due under Chapter 5747. of the Revised Code, this transfer of funds shall not be considered a withdrawal of funds from a medical savings account, nor shall it be considered a deposit to a medical savings account.

(C) An administrator of an account opened by an employer shall not close an account without the permission of the account holder until at least sixty-one days after the account holder's final date of employment. The employer shall notify the administrator of the employee's final date of employment.

Effective Date: 06-30-1997

3924.69 Death of account holder.

(A) An account holder may designate a beneficiary or beneficiaries of the account holder's medical savings account.

(B) Any funds remaining in a medical savings account upon the death of an account holder shall be distributed to the decedent's estate and shall be subject to taxation as part of the decedent's estate under Chapter 5731. of the Revised Code.

Effective Date: 10-01-1996

3924.70 Advances to cover employee's eligible medical expenses.

An employer making deposits to an employee's medical savings account on a periodic installment basis may advance to the employee, interest free, an amount needed to cover the employee's eligible medical expenses when such expenses exceed the amount then available in the employee's account, if the employee agrees to repay the advance from future installments or upon the termination of employment. If such an advance causes the employee's federal adjusted gross income to be greater than it would have been had the advance not been made, the amount by which the employee's federal adjusted gross income was increased may be deducted by the employee in determining the employee's Ohio adjusted gross income under Chapter 5747. of the Revised Code.

Effective Date: 10-01-1996

3924.71 Funds disbursed pursuant to bankruptcy protection.

Funds disbursed from a medical savings account pursuant to a filing for protection by an account holder under Title 11 of the United States Code shall not be included in the account holder's Ohio adjusted gross income for the year of disbursement in determining taxes due under Chapter 5747. of the Revised Code.

Effective Date: 10-01-1996

3924.72 Brochure explaining operation of medical savings accounts.

The superintendent of insurance shall prepare and periodically revise a brochure that clearly and concisely explains the operation of medical savings accounts authorized under sections 3924.61 to 3924.74 of the Revised Code, and that describes how an employer's or individual's use of a medical savings account may affect the employer's or individual's purchase of policies, plans, and contracts of health coverage. The superintendent shall make the brochure available, upon request, to consumers, insurers, and other third-party payers. The superintendent may adopt rules in accordance with Chapter 119. of the Revised Code to implement this section.

Effective Date: 10-01-1996

3924.73 Rights, privileges, or protections of employees or small employers.

(A) As used in this section:

(1) "Health care insurer" means any person legally engaged in the business of providing sickness and accident insurance contracts in this state, a health insuring corporation organized under Chapter 1751. of the Revised Code, or any legal entity that is self-insured and provides health care benefits to its employees or members.

(2) "Small employer" has the same meaning as in section 3924.01 of the Revised Code.

(B)

(1) Subject to division (B)(2) of this section, nothing in sections 3924.61 to 3924.74 of the Revised Code shall be construed to limit the rights, privileges, or protections of employees or small employers under sections 3924.01 to 3924.14 of the Revised Code.

(2) If any account holder enrolls or applies to enroll in a policy or contract offered by a health care insurer providing sickness and accident coverage that is more comprehensive than, and has a deductible amount that is less than, the coverage and deductible amount of the policy under which the account holder currently is enrolled, the health care insurer to which the account holder applies may subject the account holder to the same medical review, waiting periods, and underwriting requirements to which the health care insurer generally subjects other enrollees or applicants, unless the account holder enrolls or applies to enroll during a designated period of open enrollment.

Effective Date: 06-30-1997

3924.74 Coordination of benefits.

The superintendent of insurance may include coordination of benefits regarding medical savings accounts in the rules on coordination of benefits adopted under section 3902.14 of the Revised Code.

Effective Date: 10-01-1996