2013 ORS § 743.894¹
Rescinding coverage
  • permissible bases
  • notice
  • rules

(1) As used in this section, rescind means to retroactively cancel or discontinue coverage under a health benefit plan or group or individual health insurance policy for reasons other than failure to timely pay required premiums or required contributions toward the cost of coverage.

(2) An insurer may not rescind coverage of an individual under a health benefit plan or group or individual health insurance policy unless:

(a) The individual or a person seeking coverage on behalf of the individual:

(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 plan or policy; and

(b) The insurer provides at least 30 days advance written notice, in the form and manner prescribed by the Department of Consumer and Business Services, to the individual.

(3) An insurer may not rescind coverage of a group under a health benefit plan unless:

(a) The plan sponsor:

(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 plan; and

(b) The insurer provides at least 30 days advance written notice, in the form and manner prescribed by the department, to each plan enrollee or policy holder who would be affected by the rescission of coverage.

(4) An insurer that rescinds a plan or policy must provide notice of the rescission to the department in the form, manner and time frame prescribed by the department by rule.

(5) This section does not apply to long term care insurance that is subject to ORS 743.650 (Long Term Care Insurance Act) to 743.665 (Prompt pay requirements). [2011 c.500 §4; 2013 c.681 §32]

Note: 743.894 (Rescinding coverage) was added to and made a part of the Insurance Code by legislative action but was not added to ORS chapter 743 or any series therein. See Preface to Oregon Revised Statutes for further explanation.