Colorado Life Laws Part 3

Emergency services

A health carrier may not deny a claim for emergency services necessary to screen and stabilize a covered person on the grounds that an emergency medical condition did not actually exist if a prudent lay person having average knowledge of health services and medicine and acting reason- ably believed that an emergency medical condition or life- or limb-threatening emergency existed.

Appeals of adverse determinations

A health carrier must establish written procedures for the review of an adverse determination if the time frame of the review would not jeopardize either the life or health of the covered person or the covered person's ability to regain maximum function.

Procedures for review decisions

A health carrier must keep written procedures for making utilization review decisions and for notifying covered persons and providers acting on behalf of covered persons of its decisions.

Free look

A policyowner has 10 days to return a health insurance policy and receive a full refund on premiums.

Essential health benefits

All plans, under the Affordable Care Act, must include the following: Ambulatory patient services Emergency services Hospitalization Maternity and newborn care Mental health and substance use disorder services, including behavioral health treatment Prescription drugs Rehabilitative services and devices Laboratory services Preventative and wellness services and chronic disease management Pediatric services, including oral and vision care

Prompt pay

Except in the case of fraud, all claims must be paid, denied, or settled within 90 calendar days after receipt by the carrier.

Free-look period

Life insurance policies must provide a minimum free-look period of 15 days upon policy delivery. This allows the policyowner time to decide whether or not to keep it. If the policyowner decides not to keep the policy within the 15 days allowed, a full refund will be given. A life insurance policy must state that the cash surrender values and the paid-up nonforfeiture benefits available under the policy are not less than the minimum values and benefits required by the insurance laws of the state in which the policy is delivered The free-look period for a replacement policy is 30 days upon policy delivery

Grace period

The grace period for health and accident insurance is required to be no less than 7 days for weekly premium policies, 10 days for monthly premium policies, and 31 days for all other policies. If premium is paid within the grace period, coverage shall remain in effect. Individual and small employer health plans issued on or after January 1, 2014, to persons receiving a federal subsidy to help pay for coverage must contain a three-month grace period for paying any premium other than the first. During the grace period, the plan remains in force unless the policyholder notifies the carrier that he wishes to discontinue the coverage.

Recordkeeping of replacement policies

The replacing insurer must maintain copies of sales material, illustrations used, as well as the producer's and applicant's signed statements for at least five years.

Legal action

There is a waiting period of 60 days to file a lawsuit after a claim for loss has been filed by the insured. No lawsuit may be filed after 3 years has passed from when the claim was submitted.

Notice of claim

Written notice of claim for injury or for sickness must be given to the insurer within 20 days after the date of occurrence.

Proof of loss

Written proof of loss must be furnished to the insurer within 90 days after the date of such loss.

Viatical settlements

an agreement under which the owner of a life insurance policy sells the policy to another person in exchange for a bargained-for payment, which is generally less than the expected death benefit under the policy.

Incontestable period (Time limit on certain defenses)

A health policy is incontestable after it has been in force for a period of 2 years. Only fraudulent misstatements in the application may be used to void the policy or deny any claim at this point.

Policy summary and buyer's guide

A producer who sells an individual life insurance policy in Colorado must deliver to the policyowner a Policy Summary and Buyer's Guide no later than the delivery of policy.

Conservation

A producer's attempt to stop the replacement of an existing life insurance policy or annuity is known as conservation.

Entire contract

A provision that the policy (including the endorsements and the attached papers) along with the application shall constitute the entire contract between the parties.

Suicide

After a policy has been in force for one year, the insurance company can no longer contest a death claim if the cause of death was suicide.

Early intervention services

All health plans that cover dependent children must provide coverage for early intervention services delivered by a qualified early intervention provider to an eligible child. An eligible child is an infant or toddler from birth through two years of age who has significant developmental delays or has a diagnosed physical or mental condition with a high probability of resulting in significant developmental delays. The coverage available annually for each eligible child is $6,067

Colon cancer

All health policies must provide coverage for the early detection of colorectal cancer for average risk adults who are 50 years or older and asymptomatic or those at high risk due to a prior occurrence or other predisposing factor.

Coverage for mammography

All individual and group health insurance policies providing coverage on an expense incurred basis must provide benefits or coverage for mammography screening for any nonsymptomatic woman covered under such policy or contract which meets the minimum requirements of this section of the statutes. Each mammogram will pay up to $100, or the actual cost adjusted for CPI. Such benefits or coverage will include at least the following: A single baseline mammogram for women age 35-44 A mammogram once every two years for women age 45-49 28• A mammogram once every year for women age 50-65

Prostate screenings

All individual and group health plans must provide for an annual screening for early detection of prostate cancer in men over the age of 50 and in men over the age of 40 who are in high-risk categories.

Newborn child coverage

All individual and group health plans which provide coverage to family members of the insured must provide coverage for the insured's newborn child at the moment of birth. If a premium is required to continue the newborn's coverage, it must be paid within the first 31 days to continue coverage. Coverage includes injury and sickness, including medical care for diagnosed congenital defects and birth abnormalities.

Preventative health care services

All individual and group health policies issued in Colorado must cover the total cost of the following preventative health care services: Alcohol misuse screening and counseling Cervical cancer screening Breast cancer mammography screening Cholesterol screening Colorectal cancer screening Childhood immunizations Flu and pneumonia vaccinations Tobacco use screening and cessation

Diabetes

All policies must cover diabetes, including equipment, supplies, self-management training and education.

Insurable interest

An individual may not secure a policy on the life of another unless insurable interest exists at the time of application. Insurable interest can be defined as:

Notice of lapse

An insurance company must provide a notice to the insured 15 days before a policy will be cancelled or lapsed due to nonpayment.

Claim forms

An insurance company will send forms for filing proof of loss to a claimant within 15 days after company receives notice of a claim.

Commission disclosure

An insurance producer who solicits or negotiates an application for health care insurance on behalf of a carrier must disclose to the person purchasing the plan that the insurance producer will receive a commission from the carrier.

Guaranteed renewability

An insurer may only alter or discontinue health coverage under certain circumstances. Specifically, an insurer providing coverage under a health benefit plan may only refuse to renew such a plan in the case of: nonpayment of the required premium; fraud or intentional misrepresentation of material fact on the part of the plan's sponsor; the carrier is discontinuing coverage of all its similar benefit plans in the state (if so, it must notify all policyholders at least 180 days in advance of nonrenewal and thereafter cannot offer such plans for a period of five years in the state) the policyholder of a group health benefit plan fails to comply with participation or contribution rules a group carrier uses a managed care plan and there is no longer any enrollee in connection with such a plan in the carrier's service area a policyholder ceases to be a student at a college or university that provides student health coverage an employer ceases to be a member of a bona fide association through which coverage was made available

Lapse notice

An insurer must give a policyowner written notice before an individual life insurance policy will lapse due to nonpayment of premium. The notice must be mailed to the policyowner or sent electronically at least 25 days before the effective date of lapse The notice must also state the reason why the policy will lapse The notice requirement does not apply to individual policies where premiums are paid monthly or more frequently

Rate increases

An insurer must provide written notice to individual accident and health policyowners at least 30 days before the effective date of a rate increase.

Complications of pregnancy

Any accident and health policy that provides coverage for disability due to accident or sickness must provide similar coverage for a sickness or disease that is a complication of pregnancy or childbirth. A complication of pregnancy is any disease or condition that: Is adversely affected or caused by pregnancy Requires physician-prescribed supervision Results in a loss or expense that would, if not related to pregnancy, be covered by the policy

Minimum maternity benefits

Any individual and group policy that provide for maternity benefits, must provide coverage for a minimum of 48 hours of inpatient care after a vaginal delivery and a minimum of 96 hours of inpatient care after a cesarean section for a mother and her newly born child.

Disclosure

Any information required to be disclosed by the insurer cannot be minimized or intermingled within the text of advertisement so as to be confusing or misleading. Also, advertisements may not omit information or use statements, references, or illustrations that will mislead or deceive prospective purchasers.

Hearing aids for children

Coverage for hearing aids for children is mandatory in all health care plans and must include: Initial and replacement hearing aids not more frequently than every five years A new hearing aid when alterations to the existing hearing aid cannot adequately meet the needs of the child Services and supplies to include initial assessment, fitting, adjustments, and auditory training

Replacement regulation in Colorado does NOT apply to:

Credit life insurance Group life insurance or annuities Contracts issued in connection with employee benefit plans as defined by ERISA Short term nonrenewable life insurance policies (31 days or less) Existing nonconvertible term life policies that expire in five years or less and cannot be renewed

Retrospective review determinations

For retrospective review determinations, a health carrier must make the determination within 30 calendar days after receiving the benefit request.

Urgent care requests

For urgent care review determinations, a health carrier must make the determination as soon as possible, taking into account the person's medical condition, but no later than 72 hours after receiving the request.

Hospice/home health care

Home health care benefits must include coverage for at least 60 home health visits per calendar year. Hospice care services are services provided to the terminally ill, which means having a life expectancy of six months or less. Hospice benefits must be at least $150 per day for a period of 91 days.

Reinstatement

If a health policy is reinstated after it had lapsed for nonpayment, there is a waiting period of 10 days before a claim covering sickness will be covered. Injuries sustained from an accident, however, will be covered immediately.

Adverse determination

If an adverse determination is made during a covered person's hospital stay or course of treatment, the health care services must be continued without liability until the covered person is notified of the carrier's adverse determination.

Policy forms

If an insurer has been notified by the Commissioner of Insurance that an individual health policy form does not comply with the state's laws, the insurer may not issue the form in connection with any new application.

Certification of extended stay

In the case of a determination to certify an extended stay or additional services, the carrier must notify the covered person and the provider providing the service as soon as possible, taking into account the person's medical condition, but no later than 24 hours after receiving the request.

Time payment of claims

Indemnity claims will be paid immediately upon receipt of written proof of loss. Disability claims will be paid no less frequently than monthly.

Advertisements

Insurers are expected to keep a copy of every advertisement used in the state for 5 years after it was last used. These copies are subject to examination by the insurance department.

Interest payments on death benefits

Insurers must pay interest on death proceeds beginning from the date of death.

Duties of the replacing producer

Present to the applicant a Notice Regarding Replacement that is signed by both the applicant and the producer. A copy must be left with the applicant. Obtain a list of all existing life insurance and/or annuity policies to be replaced including policy numbers and the names of all companies being replaced. Leave the applicant with the original or a copy of written or printed communications used for presentation to the applicant. Submit to the replacing insurance company a copy of the Replacement Notice with the application.

Duties of the replacing producer

Present to the applicant a Notice Regarding Replacement that is signed by both theapplicant and the producer. A copy must be left with the applicant. Obtain a list of all existing life insurance and/or annuity policies to be replaced including policy numbers and the names of all companies being replaced. Leave the applicant with the original or a copy of written or printed communications used for presentation to the applicant. Submit to the replacing insurance company a copy of the Replacement Notice with the application.

Exemption from creditors

Proceeds from a life insurance policy are protected from any claims by a creditor of the insured as long as there is a named beneficiary.

Duties of the replacing insurance company

Require from the producer a list of the applicant's life insurance or annuity contracts to be replaced and a copy of the replacement notice provided to the applicant. Send each existing insurance company a written communication advising of the proposed replacement within a specified period of time of the date that the application is received in the replacing insurance company's home or regional office. A policy summary or ledger statement containing policy data on the proposed life insurance or annuity must be included.

Group life insurance

The employees eligible for group insurance under the policy shall be all of the employees of the employer To be valid, a group life insurance policy may not be issued to a group formed solely for the purpose of obtaining insurance Payments of the death proceeds are not subject to the insured's debts There must be a grace period of 31 days for premium payments Once a policy has been in effect for two years, the policy's validity may not be contested except for nonpayment of premiums In the event of a termination of a group life plan or termination of a covered employee, a person covered by a group policy has the right to convert such coverage to an individual policy within the conversion period (31 days) without proving insurability. If this right is exercised, the employee is responsible for the payment of premium. There are no restrictions regarding the assignment of coverage under a group lifeinsurance policy All statements made by the policyholder are deemed to be representations, not warranties

Utilization review

a set of formal techniques designed to evaluate the clinical necessity, appropriateness, or efficiency of health care services, procedures, or settings.

Illustrations

charts, graphs, and numerical data that depict the non-guaranteed elements of a policy over time. Non-guaranteed elements are premiums, benefits, values, credits, or charges under a policy of life insurance that are not guaranteed or not determined when the policy is issued. A life insurance illustration showing future premiums being paid out of nonguaranteed values must disclose that the policyowner may need to resume premium payments, depending on actual results.

Replacement

is strictly regulated and requires full disclosure by both the producer and the replacing insurance company. Replacement regulations exists to assure that purchasers receive specified information and it also reduces the opportunity for misrepresentation. Policy replacement is defined as a transaction in which a new policy or contract is to be purchased, and the producer is aware that an existing policy or contract has been, or will be lapsed or cancelled.

Replacement

strictly regulated and requires full disclosure by both the producer and the replacing insurance company. Replacement regulations exists to assure that purchasers receive specified information and it also reduces the opportunity for misrepresentation. Policy replacement is defined as a transaction in which a new policy or contract is to be purchased, and the producer is aware that an existing policy or contract has been, or will be: