N.M. Code R. § 13.10.23.9
A. A MHCP shall not cancel the coverage of an enrollee except for “good cause,” which, for the purposes of this section means:
(1) failure of the enrollee or subscriber to pay the premiums and other applicable charges for coverage;
(2) material failure to abide by the rules, and/or policies and procedures of the MHCP;
(3) fraud or material misrepresentation affecting coverage;
(4) a reason for cancellation or failure to renew which the superintendent determines is not objectionable.
C. Before an enrollee’s coverage may be terminated by the MHCP, the MHCP must provide written notice of at least 30 calendar days to the enrollee. Notification of cancellation of enrollment must:
(1) be in writing and dated;
(2) state the reason(s) for cancellation, with specific reference to the clause of the MHCP contract giving rise to the right of cancellation;
(3) state that an enrollee cannot be canceled because of health status, need for health care services, race, gender, age, or sexual orientation of covered persons under enrollee's contract;
(4) state that an enrollee who alleges that an enrollment has been canceled or not renewed because of the enrollee’s or covered person’s health status, need for health care services, race, gender, age, or sexual orientation may request review of the cancellation by the superintendent as set forth in 13.10.17 NMAC;
(5) state that in the event of cancellation by either the enrollee or MHCP, except in the case of fraud or deception in the use of services or facilities of the MHCP or knowingly permitting such fraud or deception by another, the MHCP shall, within 30 calendar days, return to the enrollee or subscriber the pro rata portion of the money paid to the MHCP which corresponds to any unexpired period for which payment had been received together with amounts due on claims, if any, less any amounts due the MHCP; provided, however, that the superintendent may approve other reasonable reimbursement practices;
(6) state the date on which the cancellation becomes effective;
(7) state that receipt by the MHCP of the proper prepaid or periodic payment, including all past due amounts, after cancellation of the contract for nonpayment shall reinstate the contract as though it had never been canceled if such payment is received on or before the due date of the succeeding prepaid or periodic payment; provided, however, that the contract may specify one or more of the following methods by which the MHCP may avoid such reinstatement:
(a) in the notice of cancellation, the MHCP notifies the enrollee that if payment is not received within 15 days of issuance of the notice of cancellation, a new application is required and the conditions under which a new contract will be issued or whether the original contract will be reinstated;
(b) if such payment is received more than 15 calendar days after issuance of the notice of cancellation, the MHCP refunds the payment within 20 business days; or
(c) if such payment is received more than 15 calendar days after issuance of the notice of cancellation, the MHCP issues to the enrollee, within 20 business days of receipt of such payment, a new contract accompanied by a written notice clearly stating the ways in which the new contract differs from the canceled contract, including any difference in benefits or coverage;
(8) state that the MHCP is prohibited from increasing the amount paid by the enrollee, except after a period of at least 30 calendar days from either: 1) the postage paid mailing to the enrollee at the enrollee’s address of record with the MHCP; or 2) actual hand delivery to the enrollee of written notice of such proposed increase; and
(9) state that the MHCP is prohibited from decreasing the benefits stated in the contract in any manner, except after a period of at least 30 calendar days from either: 1) the postage paid mailing to the enrollee at the enrollee’s address of record with the MHCP; or 2) actual hand delivery to the enrollee of written notice of such proposed change(s).
D. In the event that the MHCP cancels or refuses to renew a managed health care plan contract, or enrollment under the contract, the MHCP shall mail a notice of the cancellation to the enrollee at the enrollee’s address of record with the MHCP. However, in the event that the MHCP cancels or refuses to renew a group contract, the MHCP need not mail a notice of cancellation to each enrollee covered by the group plan if:
(1) the plan contract requires the group contract holder to mail promptly any such notice to each enrollee;
(2) the MHCP mails or hand delivers a notice of cancellation to the group contract holder designated in the plan contract, and the MHCP gives a written reminder to the group contract holder of its obligation under the contract; and
(3) the MHCP demonstrates that the group contract holder promptly provided proof to the MHCP of the mailing of a legible true copy of the notice of cancellation to each enrollee at the enrollee’s current address and the date the mailing occurred.
[13.10.23.9 NMAC - Rp, 13.10.13.17 NMAC, 09/01/2009]