2007 ORS 743.734¹
Group health benefit plans subject to provisions of specified laws
  • exemptions

(1) Every group health benefit plan shall be subject to the provisions of ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), if the plan provides health benefits covering one or more employees of a small employer and if any one of the following conditions is met:

(a) Any portion of the premium or benefits is paid by a small employer or any eligible employee is reimbursed, whether through wage adjustments or otherwise, by a small employer for any portion of the health benefit plan premium; or

(b) The health benefit plan is treated by the employer or any of the eligible employees as part of a plan or program for the purposes of section 106, section 125 or section 162 of the Internal Revenue Code of 1986, as amended.

(2) Except as provided in ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), no law requiring the coverage or the offer of coverage of a health care service or benefit applies to the basic health benefit plans offered or delivered to a small employer.

(3) Except as otherwise provided by law or ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), no health benefit plan offered to a small employer shall:

(a) Inhibit a small employer carrier from contracting with providers or groups of providers with respect to health care services or benefits; or

(b) Impose any restriction on the ability of a small employer carrier to negotiate with providers regarding the level or method of reimbursing care or services provided under health benefit plans.

(4) Except to determine the application of a preexisting conditions provision for a late enrollee, a small employer carrier shall not use health statements when offering small employer health benefit plans and shall not use any other method to determine the actual or expected health status of eligible enrollees. Nothing in this subsection shall prevent a carrier from using health statements or other information after enrollment for the purpose of providing services or arranging for the provision of services under a health benefit plan.

(5) Except in the case of a late enrollee and as otherwise provided in this section, a small employer carrier shall not impose different terms or conditions on the coverage, premiums or contributions of any eligible employee in a small employer group that are based on the actual or expected health status of any eligible employee.

(6) A small employer carrier may provide different health benefit plans to different categories of employees of a small employer when the employer has chosen to establish different categories of employees in a manner that does not relate to the actual or expected health status of such employees or their dependents. The categories must be based on bona fide employment-based classifications that are consistent with the employer’s usual business practice. Except as provided in ORS 743.736 (Requirements for basic health benefit plans) (10):

(a) When a small employer carrier offers coverage to a small employer with no more than 25 eligible employees, the small employer carrier shall offer coverage to all eligible employees of the small employer, without regard to the actual or expected health status of any eligible employee.

(b) When a small employer carrier offers coverage to a small employer with at least 26 but not more than 50 eligible employees, the small employer carrier may limit coverage to the categories of employees that the small employer has established as eligible for coverage, provided that the categories are based on bona fide employment-based classifications that are consistent with the employer’s usual business practice.

(c) If the small employer elects to offer coverage to dependents of eligible employees, the small employer carrier shall offer coverage to all dependents of eligible employees, without regard to the actual or expected health status of any eligible dependent.

(7) A health benefit plan issued to a small employer group through an association health plan is exempt from subsection (1) of this section. For purposes of this subsection, an association health plan is group health insurance described in ORS 743.522 ("Group health insurance" described) (2) or a health benefit plan that:

(a) Is delivered or issued for delivery to:

(A) An association or trust established in this state, that meets applicable requirements of ORS 743.524 (Eligibility of association to be group health policyholder) or 743.526 (Determination of whether trustees are policyholders), or to a multiple employer welfare arrangement located inside this state, subject to ORS 750.301 (Definitions for ORS 750.301 to 750.341) to 750.341 (Requirement for multiple employer welfare arrangement to become traditional insurer); or

(B) An association or trust established in another state, that is approved by the director under ORS 731.486 (Exemption from definition of "transact insurance" for group life policies) (7), or a multiple employer welfare arrangement located in another state that complies with ORS 750.311 (Multiple employer welfare arrangements established in another state); and

(b) Satisfies all of the following:

(A) The initial premium rate for the association health plan does not vary by more than 50 percent across the groups of small employers under the plan.

(B) The association policyholder does not discriminate in membership requirements based on actual or expected health status of individual enrollees or prospective enrollees, in accordance with ORS 743.752 (Coverage in group health benefit plans) (5).

(C) Small employer groups that have two or more eligible employees and that meet the membership requirements for the association are not excluded from the association health plan.

(D) Except as provided in subsection (8) of this section, the association health plan maintains a 95 percent retention rate.

(8)(a) The 95 percent retention rate in subsection (7) of this section does not include employer groups that:

(A) Go out of business, whether through merger, acquisition or any other reason;

(B) No longer meet eligibility requirements for membership in the association;

(C) No longer meet participation requirements for employers that are set forth in the plan documents; or

(D) Fail to pay premiums.

(b) An association health plan that fails to maintain the 95 percent retention rate during any year may have 12 months to correct the retention level before losing the exemption under subsection (7) of this section. [1991 c.916 §5; 1993 c.18 §160; 1995 c.603 §4; 1997 c.716 §5; 1999 c.987 §8; 2007 c.389 §5; 2007 c.752 §4]

Note: The amendments to 743.734 (Group health benefit plans subject to provisions of specified laws) by section 9, chapter 752, Oregon Laws 2007, become operative January 2, 2014. See section 13, chapter 752, Oregon Laws 2007. The text that is operative on and after January 2, 2014, is set forth for the user’s convenience.

743.734 (Group health benefit plans subject to provisions of specified laws). (1) Every group health benefit plan shall be subject to the provisions of ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), if the plan provides health benefits covering one or more employees of a small employer and if any one of the following conditions is met:

(a) Any portion of the premium or benefits is paid by a small employer or any eligible employee is reimbursed, whether through wage adjustments or otherwise, by a small employer for any portion of the health benefit plan premium; or

(b) The health benefit plan is treated by the employer or any of the eligible employees as part of a plan or program for the purposes of section 106, section 125 or section 162 of the Internal Revenue Code of 1986, as amended.

(2) Except as provided in ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), no law requiring the coverage or the offer of coverage of a health care service or benefit applies to the basic health benefit plans offered or delivered to a small employer.

(3) Except as otherwise provided by law or ORS 743.733 (Issuance of group health benefit plan to affiliated group of employers) to 743.737 (Requirements for small employer health benefit plans), no health benefit plan offered to a small employer shall:

(a) Inhibit a small employer carrier from contracting with providers or groups of providers with respect to health care services or benefits; or

(b) Impose any restriction on the ability of a small employer carrier to negotiate with providers regarding the level or method of reimbursing care or services provided under health benefit plans.

(4) Except to determine the application of a preexisting conditions provision for a late enrollee, a small employer carrier shall not use health statements when offering small employer health benefit plans and shall not use any other method to determine the actual or expected health status of eligible enrollees. Nothing in this subsection shall prevent a carrier from using health statements or other information after enrollment for the purpose of providing services or arranging for the provision of services under a health benefit plan.

(5) Except in the case of a late enrollee and as otherwise provided in this section, a small employer carrier shall not impose different terms or conditions on the coverage, premiums or contributions of any eligible employee in a small employer group that are based on the actual or expected health status of any eligible employee.

(6) A small employer carrier may provide different health benefit plans to different categories of employees of a small employer when the employer has chosen to establish different categories of employees in a manner that does not relate to the actual or expected health status of such employees or their dependents. The categories must be based on bona fide employment-based classifications that are consistent with the employer’s usual business practice. Except as provided in ORS 743.736 (Requirements for basic health benefit plans) (10):

(a) When a small employer carrier offers coverage to a small employer with no more than 25 eligible employees, the small employer carrier shall offer coverage to all eligible employees of the small employer, without regard to the actual or expected health status of any eligible employee.

(b) When a small employer carrier offers coverage to a small employer with at least 26 but not more than 50 eligible employees, the small employer carrier may limit coverage to the categories of employees that the small employer has established as eligible for coverage, provided that the categories are based on bona fide employment-based classifications that are consistent with the employer’s usual business practice.

(c) If the small employer elects to offer coverage to dependents of eligible employees, the small employer carrier shall offer coverage to all dependents of eligible employees, without regard to the actual or expected health status of any eligible dependent.

Note: Sections 12 and 14, chapter 752, Oregon Laws 2007, provide:

Sec. 12. (1) ORS 743.734 (Group health benefit plans subject to provisions of specified laws), as amended by section 4 of this 2007 Act, applies to health benefit plans issued or renewed on or after the effective date of this 2007 Act [July 12, 2007] and before January 2, 2014.

(2) An association health plan issued to a group described in ORS 743.522 ("Group health insurance" described) (2) prior to May 1, 2007, to an association or trust approved prior to May 1, 2007, or to a multiple employer welfare arrangement authorized prior to May 1, 2007, is not subject to the requirements of ORS 743.734 (Group health benefit plans subject to provisions of specified laws) (7)(b)(C) with respect to membership requirements in effect prior to May 1, 2007. [2007 c.752 §12]

Sec. 14. Sections 11 and 12 of this 2007 Act are repealed on January 2, 2014. [2007 c.752 §14]

1 Legislative Counsel Committee, CHAPTER 743—Health and Life Insurance, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­743.­html (2007) (last ac­cessed Feb. 12, 2009).
 
2 OregonLaws.org contains the con­tents of Volume 21 of the ORS, inserted along­side the per­tin­ent statutes. See the preface to the ORS An­no­ta­tions for more information.
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.