Wyo. Code R. 044-0002-49
General Agency, Board or Commission Rules
Chapter 49: Implement Small Employer Health Insurance Availability Act
Effective Date: 08/24/1998 to 10/13/2015
Rule Type: Superceded Rules & Regulations
Reference Number: 044.0002.49.08241998
REGULATION TO IMPLEMENT THE SMALL EMPLOYER HEALTH INSURANCE AVAILABILITY ACT § 26-19-301 et seq.
This Regulation is intended to implement the provisions of the Small Employer Health Insurance Availability Act, § 26-19-301 et seq. The general purposes of W.S. § 26-19-301 et seq. and this Regulation are to provide for the availability of health insurance coverage to small employers, regardless of their health status or claims experience; to regulate insurer rating practices and establish limits on differences in rates between health benefit plans; to ensure renewability of coverage; to provide for continuation of coverage in certain situations; to establish limitations on underwriting practices, eligibility requirements and the use of preexisting condition exclusions; to provide for establishment of a reinsurance program; to direct the basis of market competition away from risk selection and toward the efficient management of health care; and to improve the overall fairness and efficiency of the small group health insurance market. Wyoming Statute § 26-19-301 et seq. and this Regulation are intended to promote broader spreading of risk in the small employer marketplace. Wyoming Statute § 26-19-301 et seq., and this Regulation are intended to regulate all health benefit plans sold to small employers, whether sold directly or through associations or other groupings of small employers. Carriers that provide health benefit plans to small employers are intended to be subject to all of the provisions of W.S. § 26-19-301 et seq., and this Regulation.
This Regulation is issued pursuant to the authority vested in the Commissioner under W.S. §§ 26-2-110, 26-19-304(a)(xii) and 26-19-310.
For the purposes of this Regulation:
(a) 'Associate member of an employee organization' means any individual who participates in an employee benefit plan (as defined in 29 U.S.C. § 1002(1)) that is a multi-employer plan (as defined in 29 U.S.C. § 1002(37A)), other than the following:
(i) An individual (or the beneficiary of such individual) who is employed by a participating employer within a bargaining unit covered by at least one of the collective bargaining agreements under or pursuant to which the employee benefit plan is established or maintained; or
(ii) An individual who is a present or former employee (or a beneficiary of such employee) of the sponsoring employee organization, of an employer who is or was a party to at least one of the collective bargaining agreements under or pursuant to which the employee benefit plan is established or maintained, or of the employee benefit plan (or of a related plan).
(b) 'New entrant' means an eligible employee, or the dependent of an eligible employee, who becomes part of an employer group after the initial period for enrollment in a health benefit plan, and who enrolls on a timely basis within the prescribed enrollment period. If an eligible employee has continued coverage under the provisions of W.S. § 26-19-113, or under the provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985, (P.L. 99-272 and as amended), and the continued coverage is voluntarily continued to, or is voluntarily terminated on, a date that is after the end of that person's prescribed initial enrollment period of a health benefit plan, that eligible employee and his or her dependents shall not be considered late enrollees, as defined in W.S. § 26-19-302(xv).
(c) 'Qualifying previous coverage' and 'qualifying existing coverage' means public or private benefits or coverage provided under:
(i) Medicare, Medicaid, the Wyoming Health Insurance Pool, or other health benefit programs or coverages operated or maintained by any governmental entity;
(ii) An employer-based health insurance or health benefit arrangement that provides benefits similar to or exceeding benefits provided under the basic health plan; or
(iii) An individual health benefit plan (including coverage issued by a health maintenance organization, prepaid hospital or medical care plan, or a fraternal benefit society) that provides benefits similar to or exceeding the benefits provided under the basic health benefit plan.
(d) 'Risk characteristic' means the health status, claims experience, duration of coverage, or any similar characteristic related to the health status or experience of a small employer group or of any member of a small employer group.
(e) 'Risk load' means the percentage above the applicable base premium rate that is charged by a small employer carrier to a small employer to reflect the risk characteristics of the small employer group.
(a) This Regulation shall apply to any health benefit plan, whether provided on a group or individual basis, which:
(i) Meets one or more of the conditions set forth in W.S. § 26-19-303;
(ii) Provides coverage to two or more employees of a small employer located in this state, without regard to whether the policy or certificate was issued in this state; and
(iii) Is in effect on or after the effective date of W.S. § 26-19-301 et seq.
(b) A carrier that provides an individual health benefit plan to two or more of the employees of a small employer shall be considered a small employer carrier and shall be subject to the provisions of W.S. § 26-19-301 et seq. and this Regulation with respect to such policies if the small employer contributes directly or indirectly to the premiums for the policies and the carrier is aware or should have been aware of such contribution as is explained in W.S. § 26-19-303.
(c) In the case of a carrier that provides individual health benefit plans to two or more employees of a small employer, the small employer shall be considered to be an eligible small employer as defined in W.S. § 26-19-302(a)(xxii) and the small employer carrier shall be subject to W.S. § 26-19-306(a) (relating to guaranteed issue of coverage) if:
(i) The small employer has at least two (2) employees;
(ii) The small employer contributes directly or indirectly to the premiums charged by the carrier; and
(iii) The carrier is aware or should have been aware of the contribution by the employer.
(d) The provisions of W.S. § 26-19-301 et seq. and this Regulation shall apply to a health benefit plan provided to a small employer or to the employees of a small employer without regard to whether the health benefit plan is offered under or provided through a group policy or trust arrangement of any size sponsored by an association or discretionary group.
(e) An individual health insurance policy shall not be subject to the provisions of W.S. § 26-19-301 et seq. and this Regulation solely because the policyholder elects a deduction under Section 162(l) of the Internal Revenue Code.
(f) (i) If a small employer is issued a health benefit plan under the terms of W.S. § 26-19-301 et seq., the provisions of W.S. § 26-19-301 et seq. and this Regulation shall continue to apply to the health benefit plan in the case that the small employer subsequently employs more than fifty (50) eligible employees. A carrier providing coverage to such an employer shall, within sixty (60) days of becoming aware that the employer has more than fifty (50) eligible employees but no later than the anniversary date of the employer's health benefit plan, notify the employer that the protection provided under W.S. § 26-19-301 et seq. and this Regulation shall cease to apply to the employer if such employer fails to renew its current health benefit plan or elects to enroll in a different health benefit plan.
(ii) (A) If a health benefit plan is issued to an employer that is not a small employer as defined in W.S. § 26-19-302(a)(xxii), but subsequently the employer becomes a small employer (due to the loss or change of work status of one or more employees), the terms of W.S. § 26-19-301 et seq. shall not apply to the health benefit plan. The carrier providing a health benefit plan to such an employer shall not become a small employer carrier under the terms of W.S. § 26-19-301 et seq. solely because the carrier continues to provide coverage under the health benefit plan to the employer. If an employer, on the effective date of this regulation, becomes a small employer by virtue of having between twenty-six (26) and fifty (50) eligible employees, that small employer's health benefit plan must comply with the provisions of W.S. § 26-19-301, et seq. and this regulation no later than July 1, 1996, with the exception of compliance with the rate restrictions found in W.S. § 26-19-304 and section 7 of this regulation. Small employer group carriers who insure small employer groups that become subject to the act and this regulation solely because of having between twenty-six (26) and fifty (50) eligible employees shall have until August 1, 1998, to have the premium rates charged for groups of between twenty-six (26) and fifty (50) eligible employees comply with the provisions of W.S. § 26-19-304 and Section 7 of this regulation.
(B) A carrier providing coverage to an employer described in subparagraph (A) shall, within sixty (60) days of becoming aware that the employer has fifty (50) or fewer eligible employees, notify the employer of the options and protection available to the employer under W.S. § 26-19-301 et seq., including the employer's option to purchase a small employer health benefit plan from any small employer carrier.
(g) (i) (A) If a small employer has employees in more than one state, the provisions of W.S. § 26-19-301 et seq. and this Regulation shall apply to a health benefit plan issued to the small employer if:
(I) The majority of eligible employees of such small employer are employed in this state, or were residents of Wyoming; or
(II) If no state contains a majority of the eligible employees of the small employer, the primary business location of the small employer is in this state.
(B) In determining whether the laws of this state or another state apply to a health benefit plan issued to a small employer described in subparagraph (A), the provisions of the paragraph shall be applied as of the date the health benefit plan was issued to the small employer.
(ii) If a health benefit plan is subject to W.S. § 26-19-301 et seq. and this Regulation, the provisions of W.S. § 26-19-301 et seq. and this Regulation shall apply to all individuals covered under the health benefit plan, whether they reside in this state or in another state.
(h) A carrier that is not operating as a small employer carrier in this state shall not become subject to the provisions of W.S. § 26-19-301 et seq. and this Regulation solely because a small employer that was issued a health benefit plan in another state by that carrier moves to this state.
(a) A small employer carrier that establishes more than one class of business as defined in W.S. § 26-19-302(a)(vii) shall maintain on file for inspection by the Commissioner the following information with respect to each class of business so established:
(i) A description of each criterion employed by the carrier (or any of its agents) for determining membership in the class of business;
(ii) A statement describing the justification for establishing the class as a separate class of business and documentation that the establishment of additional groupings within the class of business is intended to reflect substantial differences in expected claims experience or administrative costs related to the reasons set forth in W.S. § 26-19-302(a)(vii)(B); and
(iii) A statement disclosing which, if any, health benefit plans are currently available for purchase in the class and any significant limitations related to the purchase of such plans.
(b) A carrier may not directly or indirectly use group size as a criterion for establishing eligibility for a health benefit plan or for a class of business.
(c) A carrier may establish a maximum of three (3) classes of business as set forth in W.S. § 26-19-302 (a)(vii)(A) and (B), with no more than two (2) additional groups within each established class.
(a) (i) A small employer carrier shall not transfer or assume the entire insurance obligation and/or risk of a health benefit plan covering a small employer in this state unless:
(A) The transaction has not been disapproved by the Commissioner of the state of domicile of the assuming carrier;
(B) The transaction has not been disapproved by the Commissioner of the state of domicile of the ceding carrier; and
(C) The transaction otherwise meets the requirements of this section.
(ii) A carrier domiciled in this state that proposes to assume or cede the entire insurance obligation and/or risk of one or more small employer health benefit plans from another carrier shall make a filing for approval with the Commissioner at least sixty (60) days prior to the date of the proposed transaction. The Commissioner may approve the transaction if the Commissioner finds that the transaction is in the best interests of the individuals insured under the health benefit plans to be transferred and is consistent with the purposes of W.S. § 26-19-301 et seq. and this Regulation. The Commissioner shall not approve the transaction until at least thirty (30) days after the date of the filing; except that, if the ceding carrier is in hazardous financial condition, the Commissioner may approve the transaction as soon as the Commissioner deems reasonable after the filing.
(iii) (A) The filing required under paragraph (ii) shall:
(I) Describe the class of business (including any eligibility requirements) of the ceding carrier from which the health benefit plans will be ceded;
(II) Describe whether the assuming carrier will maintain the assumed health benefit plans as a separate class of business, pursuant to subsection (c), or will incorporate them into an existing class of business, pursuant to subsection (d). If the assumed health benefit plans will be incorporated into an existing class of business, the filing shall describe the class of business of the assuming carrier into which the health benefit plans will be incorporated;
(III) Describe whether the health benefit plans being assumed are currently available for purchase by small employers;
(IV) Describe the potential effect of the assumption (if any) on the benefits provided by the health benefit plans to be assumed;
(V) Describe the potential effect of the assumption (if any) on the premiums for the health benefit plans to be assumed;
(VI) Describe any other potential material effects of the assumption on the coverage provided to the small employers covered by the health benefit plans to be assumed; and
(VII) Include any other information required by the Commissioner.
(B) A small employer carrier required to make a filing under paragraph (ii) shall also make an informational filing with the Commissioner of each state in which there are small employer health benefit plans that would be included in the transaction. The informational filing to each state shall be made concurrently with the filing made under paragraph (ii) and shall include at least the information specified in subparagraph (A) for the small employer health benefit plans in that state.
(iv) A small employer carrier shall not transfer or assume the entire insurance obligation and/or risk of a health benefit plan covering a small employer in this state unless it complies with the following provisions:
(A) The carrier has provided notice to the Commissioner at least sixty (60) days prior to the date of the proposed assumption. The notice shall contain the information specified in paragraph (iii) for the health benefit plans covering small employers in this state.
(B) If the assumption of a class of business would result in the assuming small employer carrier being out of compliance with the limitations related to premium rates contained in W.S. § 26-19-304(a)(i), the assuming carrier shall make a filing with the Commissioner pursuant to W.S. § 26-19-304(c) seeking suspension of the application of W.S. § 26-19-304(a)(i).
(C) An assuming carrier seeking suspension of the application of W.S. § 26-19-304(a)(i) shall not complete the assumption of health benefit plans covering small employers in this state unless the Commissioner grants the suspension requested pursuant to subparagraph (B).
(D) Unless a different period is approved by the Commissioner, a suspension of the application of W.S. § 26-19-304(a)(i) shall, with respect to an assumed class of business, be for no more than fifteen (15) months and, with respect to each individual small employer, shall last only until the anniversary date of such employer's coverage (except that the period with respect to an individual small employer may be extended beyond its first anniversary date for a period of up to twelve (12) months if the anniversary date occurs within three (3) months of the date of assumption of the class of business).
(b) (i) Except as provided in paragraph (ii), a small employer carrier shall not cede or assume the entire insurance obligation and/or risk for a small employer health benefit plan unless the transaction includes the ceding to the assuming carrier of the entire class of business which includes such health benefit plan.
(ii) A small employer carrier may cede less than an entire class of business to an assuming carrier if:
(A) One or more small employers in the class have exercised their right under contract or state law to reject (either directly or by implication) the ceding of their health benefit plans to another carrier. In that instance, the transaction shall include each health benefit plan in the class of business except those health benefit plans for which a small employer has rejected the proposed cession; or (B) After a written request from the transferring carrier, the Commissioner determines that the transfer of less than the entire class of business is in the best interests of the small employers insured in that class of business.
(c) Except as provided in subsection (d), a small employer carrier that assumes one or more health benefit plans from another carrier shall maintain such health benefit plans as a separate class of business.
(d) A small employer carrier that assumes one or more health benefit plans from another carrier may exceed the limitation contained in W.S. § 26-19-302(a)(vii) (relating to the maximum number of classes of business a carrier may establish) due solely to such assumption for a period of up to fifteen (15) months after the date of the assumption, provided that the carrier complies with the following provisions:
(i) Upon assumption of the health benefit plans, such health benefit plans shall be maintained as a separate class of business. During the fifteen-month period following the assumption, each of the assumed small employer health benefit plans shall be transferred by the assuming small employer carrier into a single class of business operated by the assuming small employer carrier. The assuming small employer carrier shall select the class of business into which the assumed health benefit plans will be transferred in a manner such that the transfer results in the least possible change to the benefits and rating method of the assumed health benefit plans.
(ii) The transfers authorized in paragraph (a) shall occur with respect to each small employer on the anniversary date of the small employer's coverage, except that the period with respect to an individual small employer may be extended beyond its first anniversary date for a period of up to twelve (12) months if the anniversary date occurs within three (3) months of the date of assumption of the class of business.
(iii) A small employer carrier making a transfer pursuant to paragraph (i) may alter the benefits of the assumed health benefit plans to conform to the benefits currently offered by the carrier in the class of business into which the health benefit plans have been transferred.
(iv) The premium rate for an assumed small employer health benefit plan shall not be modified by the assuming small employer carrier until the health benefit plan is transferred pursuant to paragraph (i). Upon transfer, the assuming small employer carrier shall calculate a new premium rate for the health benefit plan from the rate manual established for the class of business into which the health benefit plan is transferred. In making such calculation, the risk load applied to the health benefit plan shall be no higher than the risk load applicable to such health benefit plan prior to the assumption.
(v) During the fifteen-month period provided in this subsection, the transfer of small employer health benefit plans from the assumed class of business in accordance with this subsection shall not be considered a violation of the first sentence of W.S. § 26-19-304(b).
(e) An assuming carrier may not apply eligibility requirements (including minimum participation and contribution requirements) with respect to an assumed health benefit plan (or with respect to any health benefit plan subsequently offered to a small employer covered by such an assumed health benefit plan) that are more stringent than the requirements applicable to such health benefit plan prior to the assumption.
(f) The Commissioner may approve a longer period of transition upon application of a small employer carrier. The application shall be made within sixty (60) days after the date of assumption of the class of business and shall clearly state the justification for a longer transition period.
(g) Nothing in this section or in W.S. § 26-19-301 et seq. is intended to:
(i) Reduce or diminish any legal or contractual obligation or requirement, including any obligation of the ceding or assuming carrier related to the transaction;
(ii) Authorize a carrier that is not admitted to transact the business of insurance in this state to offer or insure health benefit plans in this state; or
(iii) Reduce or diminish the protection related to an assumption reinsurance transaction otherwise provided by law.
(a) (i) A small employer carrier shall develop a separate rate manual for each class of business. Base premium rates and new business premium rates charged to small employers by the small employer carrier shall be computed solely from the applicable rate manual developed pursuant to this subsection. To the extent that a portion of the premium rates charged by a small employer carrier is based on the carrier's discretion, the manual shall specify the criteria and factors considered by the carrier in exercising such discretion. The carrier shall also provide the Commissioner, upon request, the rate manual and any additional information or documentation specified in this Section.
(ii) (A) A small employer carrier that modifies the rating method used in the rate manual for a class of business shall maintain with the rate manual for a period of six (6) years information and documentation containing the following:
(I) The reasons the change in rating method is being modified;
(II) A complete description of each of the proposed modifications to the rating method;
(III) A description of how the change in rating method would affect the premium rates currently charged to small employers in the class of business, including an estimate from a qualified actuary of the number of groups or individuals (and a description of the types of groups or individuals) whose premium rates may change by more than ten percent (10%) due to the proposed change in rating method (not generally including increases in premium rates applicable to all small employers in a health benefit plan);
(IV) A certification from a qualified actuary that the new rating method would be based on objective and credible data and would be actuarially sound and appropriate; and
(V) A certification from a qualified actuary that the proposed change in rating method would not produce premium rates for small employers that would be in violation of W.S. § 26-19-304.
(B) For the purpose of this section a change in rating method shall mean:
(I) A change in the number of case characteristics used by a small employer carrier to determine premium rates for health benefit plans in a class of business;
(II) A change in the manner or procedures by which insureds are assigned into categories for the purpose of applying a case characteristic to determine premium rates for health benefit plans in a class of business;
(III) A change in the method of allocating expenses among health benefit plans in a class of business; or
(IV) A change in a rating factor with respect to any case characteristic if the change would produce a change in premium for any small employer that exceeds ten percent (10%). A change in a rating factor shall mean the cumulative change with respect to such factor considered over a twelve (12) month period. If a small employer carrier changes rating factors with respect to more than one case characteristic in a twelve (12) month period, the carrier shall consider the cumulative effect of all such changes in applying the ten percent (10%) test.
(b) (i) The rate manual developed pursuant to subsection (a) shall specify the case characteristics and rate factors to be applied by the small employer carrier in establishing premium rates for the class of business.
(ii) Pursuant to W.S. § 26-19-304(a)(xi), a small employer carrier may not use case characteristics other than age, gender, industry, geographic area, family composition and group size without the prior approval of the Commissioner.
(iii) A small employer carrier shall use the same case characteristics in establishing premium rates for each health benefit plan in a class of business and shall apply them in the same manner in establishing premium rates for each health benefit plan. Case characteristics shall be applied without regard to the risk characteristics of a small employer.
(iv) The rate manual developed pursuant to subsection (a) shall clearly illustrate the relationship among the base premium rates charged for each health benefit plan in the class of business. If the new business premium rate is different than the base premium rate for a health benefit plan, the rate manual shall illustrate the difference.
(v) Differences among base premium rates for health benefit plans shall be based solely on the reasonable and objective differences in the design and benefits of the health benefit plans and shall not be based in any way on the actual or expected health status or claims experience of the small employer groups that choose or are expected to choose a particular health benefit plan. A small employer carrier shall apply case characteristics and rate factors within a class of business in a manner that assures that premium differences among health benefit plans for identical small employer groups vary only due to reasonable and objective differences in the design and benefits of the health benefit plans and are not due to the actual or expected health status or claims experience of the small employer groups that choose or are expected to choose a particular health benefit plan.
(vi) (A) Except as provided in subparagraph (B), a premium charged to a small employer for a health benefit plan shall not include a separate application fee, underwriting fee, or any other separate fee or charge.
(B) A carrier may charge a separate fee with respect to a health benefit plan (but only one fee with respect to such plan) provided the fee is no more than five dollars ($5.00) per month per employee and is applied in a uniform manner to each health benefit plan in a class of business, with such fee being included in determining the carrier's compliance with W.S. § 26-19-304.
(vii) A small employer carrier shall allocate administrative expenses to the basic and standard health benefit plans on no less favorable of a basis than expenses are allocated to other health benefit plans in the class of business. The rate manual developed pursuant to subsection (a) shall describe the method of allocating administrative expenses to the health benefit plans in the class of business for which the manual was developed.
(viii) Each rate manual developed pursuant to subsection (a) shall be maintained by the carrier for a period of six (6) years. Updates and changes to the manual shall be maintained with the manual.
(ix) The rate manual and rating practices of a small employer carrier shall comply with any guidelines issued by the Commissioner.
(c) If group size is used as a case characteristic by a small employer carrier, the highest rate factor associated with a group size classification shall not exceed the lowest rate factor associated with such a classification by more than 20 percent (20%).
(d) A small employer carrier shall revise its rate manual each rating period to reflect changes in base premium rates and changes in new business premium rates.
(e) A small employer carrier shall keep on file for a period of at least six (6) years the calculations used to determine the change in base premium rates and new business premium rates for each health benefit plan for each rating period.
(f) Changes in premium rates for a small employer shall be subject to the provisions in W.S. § 26-19-304.
(g) (i) A representative of a Taft Hartley trust (including a carrier upon the written request of such a trust) may file in writing with the Commissioner a request for the waiver of application of the provisions of W.S. § 26-19-304(a) with respect to such trust.
(ii) A request made under paragraph (i) shall identify the provisions for which the trust is seeking the waiver and shall describe, with respect to each provision, the extent to which application of such provision would:
(A) Adversely affect the participants and beneficiaries of the trust; and
(B) Require modifications to one or more of the collective bargaining agreements under or pursuant to which the trust was or is established or maintained.
(iii) A waiver granted under W.S. § 26-19-303(c) shall not apply to an individual who participates in the trust because the individual is an associate member of an employee organization or the beneficiary of such an individual.
(h) Pursuant to W.S. § 26-19-304(e)(ii), each small employer carrier shall file with the commissioner on or before March 15 an actuarial certification certifying that the carrier is in compliance with W.S. § 26-19-301 et seq. and this Regulation. Such filing shall be in the format and, at a minimum, contain the information set forth in Appendix A.
(i) Small employer group carriers who insure small employer groups that become subject to this act solely because of having between twenty-six (26) and fifty (50) eligible employees shall have until August 1, 1998, to have the premium rates charged for groups of between twenty-six (26) and fifty (50) eligible employees comply with the provisions of W.S. § 26-19-304.
(a) (i) A small employer carrier that offers coverage to a small employer shall offer to provide coverage to each eligible employee and to each dependent of an eligible employee. Except as provided in paragraph (ii), the small employer carrier shall provide the same health benefit plan to each such employee and dependent.
(ii) A small employer carrier may offer the employees of a small employer the option of choosing among one or more health benefit plans, provided that each employee may choose any of the offered plans. Except as provided in W.S. § 26-19-306(c) (with respect to exclusions for preexisting conditions), the choice among benefit plans may not be limited, restricted or conditioned based upon the risk characteristics of the employees or their dependents.
(b) (i) A small employer carrier shall require each small employer that applies for coverage, as part of the application process, to provide a complete list of eligible employees and dependents of eligible employees as defined in W.S. § 26-19-302(a)(ix) and (x). All full time employees who work at least thirty hours per week and are in their waiting period, probationary period or other similar limitation of coverage shall be listed. Employees who are listed as being in their waiting period, probationary period or other period with similar limitations of coverage must be identified as such. The list must include the date on which the full time employee who is in their waiting period, probationary period or other similar period of coverage limitation achieved full time employee status, and when the waiting period, probationary period or other similar period of limitation of coverage ends. Any subsequent lists submitted to a small employer carrier shall also contain the information required in this section. The small employer carrier shall require the small employer to provide appropriate supporting documentation to verify the information required under this paragraph.
(ii) A small employer carrier shall secure a waiver with respect to each eligible employee and each dependent of such an eligible employee who declines an offer of coverage under a health benefit plan provided to a small employer. The waiver shall be signed by the eligible employee (on behalf of such employee or the dependent of such employee) and shall certify that the individual who declined coverage was informed of the availability of coverage under the health benefit plan. The waiver form shall require that the reason for declining coverage be stated on the form and shall include a written warning of the penalties imposed on late enrollees. Waivers shall be maintained by the small employer carrier for a period of six (6) years.
(iii) (A) A small employer carrier shall not issue coverage to a small employer that refuses to provide the list required under paragraph (i) or a waiver required under paragraph (ii).
(B) (I) A small employer carrier shall not issue coverage to a small employer if the carrier, or a producer for such carrier, has reason to believe that the small employer has induced or pressured an eligible employee (or dependent of an eligible employee) to decline coverage due the individual's risk characteristics.
(II) A producer shall notify a small employer carrier, prior to submitting an application for coverage with the carrier on behalf of a small employer, of any circumstances that would indicate that the small employer has induced or pressured an eligible employee (or dependent of an eligible employee) to decline coverage due to the individual's risk characteristics. Failure to provide such notification to the carrier may subject the producer to administrative action by the Wyoming Department of Insurance.
(c) (i) New entrants to a small employer group shall be offered an opportunity to enroll in the health benefit plan currently held by such group. A new entrant who does not exercise the opportunity to enroll in the health benefit plan within the period provided by the small employer carrier may be treated as a late enrollee by the carrier, provided that the period provided to enroll in the health benefit plan extends at least thirty (30) days after the date the new entrant is notified of his or her opportunity to enroll. If a small employer carrier has offered more than one health benefit plan to a small employer group pursuant to subsection (a)(ii), the new entrant shall be offered the same choice of health benefit plans as the other members of the group.
(ii) A small employer carrier shall not apply a waiting period, elimination period or other similar limitation of coverage (other than an exclusion for preexisting medical conditions or exclusion from coverage for late enrollees consistent with W.S. § 26-19-306(c)) with respect to a new entrant that is longer than one hundred eighty (180) days.
(iii) New entrants to a group shall be accepted for coverage by the small employer carrier without any restrictions or limitations on coverage related to the risk characteristics of the employees or their dependents, except that a carrier may exclude coverage for preexisting medical conditions, consistent with the provisions provided in W.S. § 26-19-306(c).
(iv) A small employer carrier may assess a risk load to the premium rate associated with a new entrant, consistent with the requirements of W.S. § 26-19-304. The risk load shall be the same risk load charged to the small employer group immediately prior to acceptance of the new entrant into the group.
(d) (i) (A) In the case of an eligible employee (or dependent of an eligible employee) who, prior to the effective dates of W.S. § 26-19-306(a), W.S. § 26-19-302(a)(xxii), and W.S. § 26-19-306(e), was excluded from coverage or denied coverage by a small employer carrier in the process of providing a health benefit plan to an eligible small employer (as defined in W.S. § 26-19-302(a)(xxii)), the small employer carrier shall provide an opportunity for the eligible employee (or dependent of such eligible employee) to enroll in the health benefit plan currently held by the small employer.
(B) A small employer carrier may require an individual who requests enrollment under this subsection to sign a statement indicating that such individual sought coverage under the group contract (other than as a late enrollee) and that the coverage was not offered to the individual.
(C) In the case of an eligible employee of an employer who becomes a small employer as defined in W.S. § 26-19-302(a)(xxii) by virtue of having between twenty six (26) and fifty (50) eligible employees on the effective date of this regulation and was excluded from coverage because the employer was not classified as a small employer until July 1, 1996, that eligible employee shall be provided the opportunity to enroll in the health benefit plan. That employee shall be credited time towards the pre-existing condition period from the date of initial enrollment application in the health benefit plan until the effective date of that employee's coverage.
(ii) The opportunity to enroll shall meet the following requirements:
(A) The opportunity to enroll shall begin no later than October 1, 1995. The period of enrollment for individuals described in paragraph (i) (A) of this subsection shall last for at least 30 days.
(B) Unless the small employer carrier has documentation showing otherwise, eligible employees and dependents of eligible employees who are provided an opportunity to enroll pursuant to this subsection shall be treated as new entrants. Premium rates related to such individuals shall be set in accordance with subsection (c).
(C) The terms of coverage offered to an individual described in paragraph (d)(i)(A) may exclude coverage for preexisting medical conditions if the health benefit plan currently held by the small employer contains such an exclusion, provided that the exclusion period shall be reduced by the number of days between the date the individual was excluded or denied coverage and the date coverage is provided to the individual pursuant to this subsection.
(D) A small employer carrier shall provide written notice at least forty-five (45) days prior to the opportunity to enroll provided in paragraph (A) to each small employer insured under a health benefit plan that becomes subject to W.S. § 26-19-301 et seq. after July 1, 1995, but was not subject to W.S. § 26-19-301 et seq. Prior to July 1, 1995, solely due to the employer having between twenty-six (26) and fifty (50) eligible employees. The notice shall clearly describe the rights granted under this subsection to employees and dependents who were previously excluded from or denied coverage and the process for enrollment of such individuals in the employer's health benefit plan.
(a) Except as provided in subsections (b) and (c), a small employer carrier may not consider the trade or occupation of the employees of a small employer or the industry or type of business in which the small employer is engaged in determining whether to issue or continue to provide coverage to the small employer.
(b) A small employer carrier may use industry as a case characteristic in establishing premium rates, subject to W.S. § 26-19-304(a)(vii).
(c) A small employer carrier may consider trade, occupation or industry as part of the eligibility criteria for a class of business, as defined in W.S. § 26-19-302(a)(vii).
(a) A carrier that has been prohibited from writing coverage for small employers in this state pursuant to W.S. § 26-19-305(c) may not resume offering health benefit plans to small employers in this state until the carrier has made a petition to the Commissioner to be reinstated as a small employer carrier and the petition has been approved by the Commissioner. In reviewing a petition, the Commissioner may ask for such information and assurances as the Commissioner finds reasonable and appropriate.
(b) In the case of a small employer carrier doing business in only one established geographic service area of the state, if the small employer carrier elects to nonrenew a health benefit plan under W.S. § 26-19-305(a)(vi), the small employer carrier shall be prohibited from offering health benefit plans to small employers in any part of the service area for a period of five (5) years. In addition, the small employer carrier shall not offer health benefit plans to small employers in any other geographic area of the state without the prior approval of the Commissioner. In considering whether to grant approval, the Commissioner may ask for such information and assurances as the Commissioner finds reasonable and appropriate.
(a) For the purposes of W.S. § 26-19-302(a)(xv) and 306(c)(ii), an individual will be considered to have previous or existing coverage if the previous or existing policy, certificate or other benefit arrangement covering such individual met the definition of qualifying previous coverage or qualifying existing coverage contained in Section 3(c) of this Regulation. The small employer carrier shall interpret W.S. § 26-19-301 et seq. and this Regulation no less favorably to an insured individual than the following:
(i) A health insurance policy, certificate or other health benefit arrangement shall be considered employer-based if an employer sponsors the plan or arrangement or makes a contribution to the plan or arrangement.
(ii) A health insurance policy, certificate or other benefit arrangement shall be considered to provide benefits similar to or exceeding the benefits provided under the basic health benefit plan if the policy, certificate or other benefit arrangement provides benefits that:
(A) Have an actuarial value (as considered for a normal distribution of groups) that is not substantially less than the actuarial value of the basic health benefit plan; or
(B) Provides coverage for hospitalization and physician services that is substantially similar to or exceeds the coverage for such services in the basic health benefit plan.
(b) In making a determination under subsection (a), a small employer carrier shall evaluate the previous or existing policy, certificate or other benefit arrangement taken as a whole and shall not base its decision solely on the fact that one portion of the previous or existing policy, certificate or benefit arrangement provides less coverage than the comparable portion of the basic health benefit plan.
(c) For the purposes of W.S. § 26-19-306(c)(ii), an individual will be considered to have qualifying previous coverage with respect to a particular service if the previous policy, certificate or other benefit arrangement covering such individual met the definition of qualifying previous coverage contained in Section 3 of this Regulation and provided any benefit with respect to the service.
(d) A small employer carrier shall ascertain the source of previous or existing coverage of each eligible employee and each dependent of an eligible employee at the time such employee or dependent initially enrolls into the health benefit plan provided by the small employer carrier. The small employer carrier shall have the responsibility to contact the source of such previous or existing coverage to resolve any questions about the benefits or limitations related to such previous or existing coverage.
(a) A small employer carrier may rescind coverage for any small employer group or any eligible employee, any dependent of an eligible employee. Rescission must be based solely upon material misstatements made during the application process, and shall be subject to any applicable time limits on certain defenses provisions. When such rescission action is taken, premiums for the policy or certificates rescinded must be refunded less any claims paid prior to the date of rescission. At the small employer carrier's option, the small employer carrier may seek to recover any amounts of claims paid in excess of premiums paid. The rescinded coverage shall be considered null and void from the date of issuance or the effective date of the coverage. Rescissions of the coverage of an entire small employer group, including employees and dependents, shall be limited to circumstances under which the application misstatements have been made by the small employer in its capacity as an employer. Whenever possible, rescission shall be limited to the coverages derived through a single employee.
(b) An individual who was not initially a late enrollee and whose coverage is subsequently rescinded shall be allowed to re-enroll in the health benefit plan as of the date the coverage was rescinded. The individual insured person shall be treated as a late enrollee if the rescission of coverage takes place on a date beyond the final date of enrollment he or she was last eligible to enroll in the health benefit plan as a new entrant. Coverage that was rescinded shall not be considered as qualifying previous coverage or qualifying existing coverage. On or after the effective date of such individual's re-enrollment in a health benefit plan, the small employer carrier may adjust the premium charge to the small employer group for future rating periods to be in accordance with permissible and applicable rating factors as though full, accurate and timely underwriting information had been supplied when the individual initially enrolled in the plan.
(a) A restrictive rider, endorsement or other provision that would violate the provisions of W.S. § 26-19-306(c)(vi) and that was in force on the effective date of this Regulation may not remain in force beyond the first anniversary date of the health benefit plan subject to the restrictive provision that follows the effective date of this Regulation. A small employer carrier shall provide written notice to those small employers whose coverage will be changed pursuant to this subsection at least thirty (30) days prior to the required change to the health benefit plan.
(b) Except as permitted in W.S. § 26-19-306(c)(iii), a small employer carrier shall not modify or restrict a basic or standard health benefit plan in any manner for the purposes of restricting or excluding coverage or benefits for specific diseases, medical conditions or services otherwise covered by the plan.
(c) Except as permitted in W.S. § 26-19-306(c)(iii), a small employer carrier shall not modify or restrict any health benefit plan with respect to any eligible employee or dependent of an eligible employee, through riders, endorsements or otherwise, for the purpose of restricting or excluding the coverage or benefits provided to such employee or dependent for specific diseases, medical conditions or services otherwise covered by the plan.
(d) Any rates or rating on individual employees or dependents of a small employer that would violate the provisions of W.S. § 26-19-304(a)(iv) and that was in force on the effective date of this Regulation may not remain in force beyond the first anniversary date of the health benefit plan subject to such ratings that follow the effective date of this Regulation. Adjustments in rates for claims experience, health status and duration from issue shall be applied uniformly to the rates charged for all employees and dependents of the small employer.
(a) (i) A small employer carrier shall actively market each of its health benefit plans to small employers in this state. A small employer carrier may not suspend the marketing or issuance of the basic and standard health benefit plans unless the carrier has good cause and has received the prior approval of the Commissioner.
(ii) In marketing the basic and standard health benefit plans to small employers, a small employer carrier shall use at least the same sources and methods of distribution that it uses to market other health benefit plans to small employers. Any producer authorized by a small employer carrier to market health benefit plans to small employers in the state shall also be authorized to market the basic and standard health benefit plans.
(b) (i) A small employer carrier shall offer at least the basic and standard health benefit plans to any small employer that applies for or makes an inquiry regarding health insurance coverage from the small employer carrier. The offer shall be in writing and the offer may be provided directly to the small employer or delivered through a producer and shall include at least the following information:
(A) A general description of the benefits contained in the basic and standard health benefit plans and any other health benefit plan being offered to the small employer; and
(B) Information describing how the small employer may enroll in the plans.
(ii) (A) A small employer carrier shall provide a price quote to a small employer (directly or through an authorized producer) within fifteen (15) working days of receiving a request for a quote and such information as is necessary to provide the quote. A small employer carrier shall notify a small employer (directly or through an authorized producer) within ten (10) working days of receiving a request for a price quote of any additional information needed by the small employer carrier to provide the quote.
(B) A small employer carrier may not apply more stringent or detailed requirements related to the application process for the basic and standard health benefit plans than are applied for other health benefit plans offered by the carrier.
(iii) (A) If a small employer carrier denies coverage under a health benefit plan to a small employer on the basis of a risk characteristic, the denial shall be in writing and shall state with specificity the reasons for the denial (subject to any restrictions related to confidentiality of medical information). The written denial shall be accompanied by a written explanation of the availability of the basic and standard health benefit plans from the small employer carrier. The explanation shall include at least the following:
(I) A general description of the benefits contained in each such plan;
(II) A price quote for each such plan; and
(III) Information describing how the small employer may enroll in such plans.
(B) The written information described in subparagraph (A) may be provided within the time periods provided in paragraph (ii) directly to the small employer or delivered through an authorized producer.
(C) The price quote required under subparagraph (A)(II) shall be for the lowest-priced basic and standard health benefit plan for which the small employer is eligible.
(c) The small group carrier shall not require a small employer to join or contribute to any association or group as a condition of being accepted for coverage by the small employer carrier, except that, if membership in an association or other group is a requirement for accepting a small employer into a particular health benefit plan, a small employer carrier may apply such requirement.
(d) A small employer carrier may not require, as a condition to the offer or sale of a health benefit plan to a small employer, that the small employer purchase or qualify for any other insurance product or service.
(e) (i) Carriers offering individual and group health benefit plans in this state shall be responsible for determining whether the plans are subject to the requirements of W.S. § 26-19-301 et seq. and this Regulation. Carriers shall elicit the following information from applicants for such plans at the time of application:
(A) Whether or not any portion of the premium will be paid by or on behalf of a small employer, either directly or through wage adjustments or other means of reimbursement; and
(B) Whether or not the prospective policyholder, certificate holder or any prospective insured individual intends to treat the health benefit plan as part of plan or program under Section 162 (other than Section 162(l)), Section 125 or Section 106 of the United States Internal Revenue Code.
(ii) If a small employer carrier fails to comply with paragraph (i), the small employer carrier shall be deemed to be on notice of any information that could reasonably have been attained if the small employer carrier had complied with paragraph (i).
(f) (i) A small employer carrier shall file annually the following information with the Commissioner related to health benefit plans issued by the small employer carrier to small employers in this state:
(ii) The information in paragraph (i) shall be filed with the commissioner on or before March 15. Such filing shall be in the format and, at a minimum, contain the information the commissioner prescribes. Such filing shall be made in conjunction with the information specified under Section 7 (g) of this Regulation. The format and required information may be obtained from the Wyoming Insurance Department.
(g) (i) Failure of the small group carrier to comply with the provisions of this section may subject such carrier to administrative action by the Wyoming Department of Insurance.
(a) (i) Within sixty (60) days after the effective date of this Regulation, each carrier providing health benefit plans in this state that has not filed with the commissioner the basic and standard plans pursuant to W.S. § 26-19-306(b) shall make a filing with the Commissioner indicating whether the carrier intends to operate as a small employer carrier in this state under the terms of this Regulation.
(ii) Carriers that have filed with the commissioner the basic and standard plans pursuant to W.S. § 26-19-306(b) shall be considered as operating as a small employer carrier in the state.
(b) Subject to subsection (c), a carrier shall not offer health benefit plans to small employers, or continue to provide coverage under health benefit plans previously issued to small employers in this state, unless the filing provided pursuant to subsection (a) indicates that the carrier intends to operate as a small employer carrier in this state.
(c) If the filing made pursuant subsection (a) indicates that a carrier does not intend to operate as a small employer carrier in this state, the carrier may continue to provide coverage under health benefit plans previously issued to small employers in this state only if the carrier complies with the following provisions:
(i) The carrier complies with the requirements W.S. § 26-19-301 et seq. with respect to each of the health benefit plans previously issued to small employers by the carrier.
(ii) The carrier provides coverage to each new entrant to a health benefit plan previously issued to a small employer by the carrier. The provisions of W.S. § 26-19-301 et seq. and this Regulation shall apply to the coverage issued to such new entrants.
(iii) The carrier complies with the requirements of Sections 7, 8, and 13 of this Regulation as they apply to eligible employees and dependents of small employers whose coverage has been denied, limited, or restricted by the carrier, or whose rates are in violation of W.S. § 26-19-304(a)(iv).
(d) If the filing made pursuant subsection (a) indicates that a carrier does not intend to operate as a small employer carrier in this state, the carrier shall be precluded from operating as a small employer carrier in this state, except as provided for in subsection (c), for a period of five (5) years from the date of the filing. Upon a written request from such a carrier, the Commissioner may reduce the period provided for in the previous sentence if the Commissioner finds that permitting the carrier to operate as a small employer carrier would be in the best interests of the small employers in the state.
(a) Continuation of coverage shall be made available to any eligible employee or dependent of an eligible employee who has been continuously covered by the health benefit plan during the entire three (3) month period ending with the termination of eligibility. Continuation must be made available to the eligible employee regardless of whether or not the covered dependents elect to continue coverage under W.S. § 26-19-113 and this regulation. Continuation must be made available to dependents of eligible employees who terminate employment or membership or eligibility regardless of whether or not the eligible employee continues coverage as provided in W.S. § 26-19-113 and this regulation.
(b) Former eligible employees or their dependents of the group that are continuing their coverage are not to be counted towards fulfilling that group's minimum participation requirements.
(c) The small group employer solely shall designate to whom the payment of premiums are to be made. This designation shall be made at the time continuation of coverage is elected. This designation shall be done in writing and be delivered to the former eligible employee who is electing to continue coverage as set forth in W.S. § 26-19-113.
(d) The former eligible employee or the dependent of a former eligible employee must notify the small employer of his or her desire to continue coverage as set forth in W.S. § 26-19-113. The notification must be within thirty-one (31) days after the expiration of coverage. This notification shall also include the former eligible employee's and/or dependent's election to continue dental, vision or other benefits that are in addition to the hospital, surgical, or other major medical benefits that were in the small employer group policy. This election can be made only once, and the decision is irrevocable after the election.
(e) Grace period provisions that apply to former eligible employees who are continuing their coverage shall not be more restrictive than the grace period provisions that apply to the small employer group policy in which they were previously enrolled.
(f) For the purposes of this section, 'former eligible employees' shall be defined as an eligible employee or dependent who has lost coverage under the small employer health benefit plan and is eligible to enroll for continuation of coverage, or who is currently continuing coverage as set forth in W.S. § 26-19-113.
TO: SMALL EMPLOYER HEALTH INSURANCE COMPLIANCE DIVISION
FROM: (Please type or print)
NAME OF COMPANY: _____
NAIC NUMBER: _____
NAME OF CONTACT PERSON: _____
TITLE: _____
TELEPHONE NUMBER: _____
DATE: _____
ADDRESS: _____
I. Actuarial Certification:
I hereby certify that the rates charged small groups in the state of Wyoming are:
1. Based on rating methods that are actuarially sound;
2. Such that the index rate for any class of business does not exceed the index rate for another class of business by more than twenty percent (20%);
3. Such that rates for small employers with similar characteristics within a class of business do not vary from the index rate by more than thirty-five percent (35%);
4. Such that the percentage increase in the premium rate for a renewal rating period does not exceed the sum of the following: (a) The percentage change in the new business premium rate measured from the first day of the prior rating period to the first day of the new rating period, or the percentage change in the base premium rate in the case of a class of business for which the insurer is not issuing new policies, (b) An adjustment of not more than fifteen (15%) annually, adjusted pro rata for shorter rating periods, for such rating factors as claim experience, health status, and duration of coverage, determined in accordance with the [name of small employer carrier] rate manual or renewal rating guidelines, and
(c) An adjustment for a change in case characteristics or in benefit design characteristics, determined in accordance with the [name of small employer carrier] rate manual and rating procedure.
5. Such that the rate factor associated with any industry classification does not vary from the arithmetic average of the rate factors associated with all industry classifications by greater than fifteen percent (15%) of such coverage; and
6. In compliance with all other facets of W.S. 26-19-301 through 310, based upon the examination of premium rates for applicable health benefit plans and the review of their underlying actuarial assumptions and methods.
I certify that sufficient documentation of compliance is on file with the [name of small employer carrier] and available upon request by the Commissioner of Insurance.
Signature
Name ( Typed or printed) _____
Title (Typed or Printed) _____