2011 ORS § 743.760¹
Approval of portability plans
  • offering of plans by carriers
  • required provisions
  • actuarial certification

(1) As used in this section:

(a) Carrier means an insurer authorized to issue a policy of health insurance in this state. Carrier does not include a multiple employer welfare arrangement.

(b)(A) Eligible individual means an individual who:

(i) Has left coverage that was continuously in effect for a period of 180 days or more under one or more Oregon group health benefit plans, has applied for portability coverage not later than the 63rd day after termination of group coverage issued by an Oregon carrier and is an Oregon resident at the time of such application; or

(ii) Meets the eligibility requirements of 42 U.S.C. 300gg-41, has applied for portability coverage not later than the 63rd day after termination of group coverage issued by an Oregon carrier and is an Oregon resident at the time of such application.

(B) Except as provided in subsection (12) of this section, eligible individual does not include an individual who remains eligible for the individuals prior group coverage or would remain eligible for prior group coverage in a plan under the federal Employee Retirement Income Security Act of 1974, as amended, were it not for action by the plan sponsor relating to the actual or expected health condition of the individual, or who is covered under another health benefit plan at the time that portability coverage would commence or is eligible for the federal Medicare program.

(c) Portability health benefit plans and portability plans mean health benefit plans for eligible individuals that are required to be offered by all carriers offering group health benefit plans and that have been approved by the Director of the Department of Consumer and Business Services in accordance with this section.

(2)(a) In order to improve the availability and affordability of health benefit plans for individuals leaving coverage under group health benefit plans, the director shall develop two portability health benefit plans pursuant to ORS 743.745 (Requirements for basic health benefit plans). One plan shall be in the form of insurance and the second plan shall be consistent with the type of coverage provided by health maintenance organizations. For each type of portability plan, the director shall establish standards for:

(A) A prevailing benefit plan, which shall reflect the benefit coverages that are prevalent in the group health insurance market; and

(B) A low cost benefit plan, which shall emphasize affordability for eligible individuals.

(b) Except as provided in ORS 743.730 (Definitions for ORS 743.730 to 743.773) to 743.773 (Rules for ORS 743.766 to 743.769), no state law requiring the coverage or the offer of coverage of a health care service or benefit shall apply to portability health benefit plans.

(3) The standards for portability health benefit plans established by the director under subsection (2) of this section must provide for appropriate accessibility and affordability of needed health care services and comply with all other provisions of this section.

(4) Each carrier offering group health benefit plans shall submit to the director the policy form or forms containing at least one low cost benefit and one prevailing benefit portability plan offered by the carrier that meets the standards established by the director under subsection (2) of this section. Each policy form must be submitted as prescribed by the director and is subject to review and approval pursuant to ORS 742.003 (Filing and approval of policy forms).

(5) No later than 180 days after the director establishes standards for portability plans, as a condition of transacting group health insurance in this state, each carrier offering group health benefit plans shall make available to eligible individuals the prevailing benefit and low cost benefit portability plans that have been submitted by the carrier and approved by the director under subsection (4) of this section.

(6) A carrier offering group health benefit plans shall issue to an eligible individual who is leaving or has left group coverage provided by that carrier any portability plan offered by the carrier if the eligible individual applies for the plan within 63 days after termination of prior coverage and agrees to make the required premium payments and to satisfy the other provisions of the portability plan.

(7) Premium rates for portability plans shall be subject to the following provisions:

(a) Each carrier must file with the director the carriers initial geographic average rate and any changes in the geographic average rate with respect to each portability health benefit plan issued by the carrier.

(b) The premium rates charged during the rating period for each portability health benefit plan shall not vary from the geographic average rate, except that the premium rate may be adjusted to reflect differences in benefit design, family composition and age. Adjustments for age shall comply with the following:

(A) For each plan, the variation between the lowest premium rate and the highest premium rate shall not exceed 100 percent of the lowest premium rate.

(B) Premium variations shall be determined by applying uniformly the carriers schedule of age adjustments for portability plans as approved by the director.

(c) Premium variations between the portability plans and the rest of the carriers group plans must be based solely on objective differences in plan design or coverage and must not include differences based on the actual or expected health status of individuals who select portability health benefit plans. For purposes of determining the premium variations under this paragraph, a carrier may:

(A) Pool all portability plans with all group health benefit plans; or

(B) Pool all portability plans for eligible individuals leaving small employer group health benefit plan coverage with all plans offered to small employers and pool all portability plans for eligible individuals leaving other group health benefit plan coverage with all health benefit plans offered to such other groups.

(d) A carrier may not increase the rates of a portability plan issued to a policyholder more than once in any 12-month period. Annual rate increases shall be effective on the anniversary date of the plan issued to the policyholder. The percentage increase in the premium rate charged to a policyholder for a new rating period may not exceed the average increase in the rest of the carriers applicable group health benefit plans plus an adjustment for age.

(8) A portability plan under this section may not contain preexisting condition exclusions, waiting periods or other similar limitations on coverage.

(9) Portability health benefit plans shall be renewable with respect to all enrollees at the option of the enrollee unless:

(a) The policyholder fails to pay the required premiums;

(b) The policyholder or a representative of the policyholder engages in fraud or makes an intentional misrepresentation of a material fact as prohibited by the terms of the policy;

(c) The carrier elects to discontinue offering all of its group health benefit plans in accordance with ORS 743.737 (Requirements for small employer health benefit plans) and 743.754 (Requirements for group health benefit plans); or

(d) The director orders the carrier to discontinue coverage in accordance with procedures specified or approved by the director upon finding that the continuation of the coverage would:

(A) Not be in the best interests of the enrollees; or

(B) Impair the carriers ability to meet its contractual obligations.

(10)(a) A carrier offering a group health benefit plan shall maintain at its principal place of business a complete and detailed description of its rating practices and renewal underwriting practices relating to its portability plans, including information and documentation that demonstrate that its rating methods and practices are based upon commonly accepted actuarial practices and are in accordance with sound actuarial principles.

(b) A carrier offering a group health benefit plan shall file with the Department of Consumer and Business Services annually on or before March 15 an actuarial certification that the carrier is in compliance with this section and that its rating methods are actuarially sound. Each certification shall be in a form and manner and shall contain such information as specified by the department. A copy of each certification shall be retained by the carrier at its principal place of business.

(c) A carrier offering a group health benefit plan shall make the information and documentation described in paragraph (a) of this subsection available to the department upon request. Except as provided in ORS 743.018 (Filing of rates for life and health insurance) and except in cases of violations of the Insurance Code, the information is proprietary and trade secret information and shall not be subject to disclosure to persons outside the department except as agreed to by the carrier or as ordered by a court of competent jurisdiction.

(11) A carrier offering a group health benefit plan shall not provide any financial or other incentive to any insurance producer that would encourage the insurance producer to market and sell portability plans of the carrier on the basis of an eligible individuals anticipated claims experience.

(12) An individual who is eligible to obtain a portability plan in accordance with this section may obtain such a plan regardless of whether the eligible individual qualifies for a period of continuation coverage under federal law or under ORS 743.600 (Availability of continued coverage under group policy for surviving, divorced or separated spouse 55 or older) or 743.610 (Continuation of coverage under group policy upon termination of membership in group health insurance policy). However, an individual who has elected such continuation coverage is not eligible to obtain a portability plan until the continuation coverage has been discontinued by the individual or has been exhausted.

(13) Subject to the provisions of ORS 743.894 (Rescinding coverage) (2) and (4), a carrier may rescind a portability health benefit plan issued to a policyholder only if the policyholder or a representative of the policyholder:

(a) Performs an act, practice or omission that constitutes fraud; or

(b) Makes an intentional misrepresentation of a material fact as prohibited by the terms of the policy. [1995 c.603 §18; 1997 c.716 §25; 1999 c.987 §14; 2003 c.364 §115; 2007 c.391 §3; 2011 c.500 §22]

Note: Additions by chapter 322, Oregon Laws 2011, to the series 743.730 (Definitions for ORS 743.730 to 743.773) to 743.773 (Rules for ORS 743.766 to 743.769), which become operative January 2, 2014, expand the series to 743.730 (Definitions for ORS 743.730 to 743.773) to 743.773 (Rules for ORS 743.766 to 743.769), 743.822 (Requirement to offer bronze and silver plans) and 743.826 (Requirements for catastrophic plans). See sections 1, 2 [743.822 (Requirement to offer bronze and silver plans) (2)], 3 [743.822 (Requirement to offer bronze and silver plans) (1)], 4 [743.826 (Requirements for catastrophic plans)] and 6, chapter 322, Oregon Laws 2011. See Preface to Oregon Revised Statutes for further explanation.