72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
 
HA to HB 2987
 
LC 2963/HB 2987-3
 
                       HOUSE AMENDMENTS TO
                         HOUSE BILL 2987
 
            By COMMITTEE ON HEALTH AND HUMAN SERVICES
 
                              May 2
 
  On page 1 of the printed bill, line 2, after '743.737 ' insert
'and 746.600'.
  In line 8, delete the period and insert 'if the following
requirements are met:
  ' (a) Each preexisting condition must be identified on an
addendum to the individual health benefit plan and must include
the appropriate disease code from the International
Classification of Diseases, Ninth Revision, Clinical
Modification, including the disease category and a written
description of the condition;
  ' (b) Each addendum to the individual health benefit plan must
be limited to one specific condition and may not be extended to
include any secondary condition that might be directly or
indirectly related to the preexisting condition; and
  ' (c) Each addendum to the individual health benefit plan must
be agreed to in writing by both parties before or on the
effective date of coverage.'.
  On page 5, after line 33, insert:
  '  { +  SECTION 5. + } ORS 746.600 is amended to read:
  ' 746.600. As used in ORS 746.600 to 746.690 and 750.055:
  ' (1) 'Adverse underwriting decision' means, except as provided
in subsection (2) of this section, any of the following actions
with respect to insurance transactions involving insurance
coverage which is individually underwritten:
  ' (a) A declination of insurance coverage.
  ' (b) A termination of insurance coverage.
  ' (c) Failure of an agent to apply for insurance coverage with
a specific insurer which the agent represents and which is
requested by an applicant.
  ' (d) In the case of life or health insurance coverage, an
offer to insure at higher than standard rates.
  '  { +  (e) In the case of individual health insurance
coverage, an offer to insure the applicant under a health benefit
plan that imposes a waiver of coverage for one or more
preexisting conditions for a period of time that is greater than
six months and less than 24 months following the applicant's
effective date of coverage. + }
  '  { - (e) - }   { + (f) + } In the case of other kinds of
insurance coverage:
  ' (A) Placement by an insurer or agent of a risk with a
residual market mechanism, an unauthorized insurer or an insurer
which specializes in substandard risks.
  ' (B) The charging of a higher rate on the basis of information
which differs from that which the applicant or policyholder
furnished.
  ' (2) 'Adverse underwriting decision' does not include the
following actions, but the insurer or agent responsible for the
occurrence of the action shall nevertheless provide the applicant
or policyholder with the specific reason or reasons for the
occurrence:
  ' (a) The termination of an individual policy form on a class
or statewide basis.
  ' (b) A declination of insurance coverage solely because the
coverage is not available on a class or statewide basis.
  ' (c) The rescission of a policy.
  ' (3) 'Affiliate of' a specified person or 'person affiliated
with' a specified person means a person who directly, or
indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person
specified.
  ' (4) 'Agent' means a person licensed by the Director of the
Department of Consumer and Business Services as a resident or
nonresident insurance agent.
  ' (5) 'Applicant' means a person who seeks to contract for
insurance coverage, other than a person seeking group insurance
coverage which is not individually underwritten.
  ' (6) 'Consumer report' means any written, oral or other
communication of information bearing on a natural person's
creditworthiness, credit standing, credit capacity, character,
general reputation, personal characteristics or mode of living
which is used or expected to be used in connection with an
insurance transaction.
  ' (7) 'Consumer reporting agency' means a person who:
  ' (a) Regularly engages, in whole or in part, in assembling or
preparing consumer reports for a monetary fee;
  ' (b) Obtains information primarily from sources other than
insurers; and
  ' (c) Furnishes consumer reports to other persons.
  ' (8) 'Control' means, and the terms 'controlled by' or ' under
common control with' refer to, the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the
ownership of voting securities, by contract other than a
commercial contract for goods or nonmanagement services, or
otherwise, unless the power of the person is the result of a
corporate office held in, or an official position held with, the
controlled person.
  ' (9) 'Declination of insurance coverage' means a denial, in
whole or in part, by an insurer or agent of requested insurance
coverage.
  ' (10) 'Individual':
  ' (a) Means, for purposes of ORS 746.600 to 746.690 and
750.055, except as provided in paragraph (b) of this subsection,
a natural person who:
  ' (A) In the case of life or health insurance, is a past,
present or proposed principal insured or certificate holder;
  ' (B) In the case of other kinds of insurance, is a past,
present or proposed named insured or certificate holder;
  ' (C) Is a past, present or proposed policyowner;
  ' (D) Is a past or present applicant;
  ' (E) Is a past or present claimant; or
  ' (F) Derived, derives or is proposed to derive insurance
coverage under an insurance policy or certificate which is
subject to ORS 746.600 to 746.690 and 750.055.
  ' (b) Comprises, for purposes of ORS 746.620, 746.630 and
746.665, and for purposes of terms defined in this section as
those terms are used in ORS 746.620, 746.630 and 746.665, the
following categories of natural persons:
  ' (A) 'Consumer,' which means an individual, or the
individual's representative, who seeks to obtain, obtains or has
obtained an insurance product or service from a licensee that is
to be used primarily for personal, family or household purposes,
and about whom the licensee has personal information.
  ' (B) 'Customer,' which means a consumer who has a continuing
relationship with a licensee under which the licensee provides
one or more insurance products or services to the consumer that
are to be used primarily for personal, family or household
purposes.
  ' (11) 'Institutional source' means a person or governmental
entity which provides information about an individual to an
insurer, agent or insurance-support organization, other than:
  ' (a) An agent;
  ' (b) The individual who is the subject of the information; or
  ' (c) A natural person acting in a personal capacity rather
than in a business or professional capacity.
  ' (12) 'Insurance-support organization' means, except as
provided in subsection (13) of this section, a person who
regularly engages, in whole or in part, in assembling or
collecting information about natural persons for the primary
purpose of providing the information to an insurer or agent for
insurance transactions, including:
  ' (a) The furnishing of consumer reports to an insurer or agent
for use in connection with insurance transactions; and
  ' (b) The collection of personal information from insurers,
agents or other insurance-support organizations for the purpose
of detecting or preventing fraud, material misrepresentation or
material nondisclosure in connection with insurance underwriting
or insurance claim activity.
  ' (13) 'Insurance-support organization' does not include
insurers, agents, governmental institutions, medical care
institutions or medical professionals.
  ' (14) 'Insurance transaction' means any transaction involving
insurance primarily for personal, family or household needs
rather than business or professional needs and which entails:
  ' (a) The determination of an individual's eligibility for an
insurance coverage, benefit or payment; or
  ' (b) The servicing of an insurance application, policy or
certificate.
  ' (15) 'Insurer,' as defined in ORS 731.106, includes every
person engaged in the business of entering into policies of
insurance.
  ' (16) 'Investigative consumer report' means a consumer report,
or portion of a consumer report, for which information about a
natural person's character, general reputation, personal
characteristics or mode of living is obtained through personal
interviews with the person's neighbors, friends, associates,
acquaintances or others who may have knowledge concerning such
items of information.
  ' (17) 'Licensee' means an insurer, agent or other person
authorized or required to be authorized, or licensed or required
to be licensed, pursuant to the Insurance Code.
  ' (18) 'Medical care institution' means a facility or
institution which is licensed to provide health care services to
natural persons, and includes but is not limited to health
maintenance organizations, home health agencies, hospitals,
medical clinics, public health agencies, rehabilitation agencies
and skilled nursing facilities.
  ' (19) 'Medical professional' means a person licensed or
certified to provide health care services to natural persons, and
includes but is not limited to chiropractors, clinical
dieticians, clinical psychologists, dentists, naturopaths,
nurses, occupational therapists, optometrists, pharmacists,
physical therapists, physicians, podiatrists, psychiatric social
workers and speech therapists.
  ' (20) 'Medical record information' means personal information
except age or gender, whether oral or recorded in any form or
medium, created by or derived from a health care provider or the
consumer that relates to:
  ' (a) The past, present or future physical, mental or
behavioral health or condition of an individual;
  ' (b) The provision of health care to an individual; or
 
  ' (c) Payment for the provision of health care to an
individual.
  ' (21) 'Nonaffiliated third party' means any person except:
  ' (a) An affiliate of a licensee;
  ' (b) A person that is employed jointly by a licensee and by a
person that is not an affiliate of the licensee; and
  ' (c) As designated by the director by rule.
  ' (22) 'Personal information' means information which is
identifiable with an individual, which is gathered in connection
with an insurance transaction and from which information
judgments can be made about the individual's character, habits,
avocations, finances, occupations, general reputation, credit,
health or any other personal characteristics. 'Personal
information' includes an individual's name and address, an
individual's policy number or similar form of access code for the
individual's policy and ' medical record information' but does
not include 'privileged information' except for privileged
information which has been disclosed in violation of ORS 746.665.
'Personal information' does not include information that a
licensee has a reasonable basis to believe is lawfully made
available to the general public from federal, state or local
government records, widely distributed media or disclosures to
the public that are required by federal, state or local law.
  ' (23) 'Policyholder' means a person who:
  ' (a) In the case of individual policies of life or health
insurance, is a current policyowner;
  ' (b) In the case of individual policies of other kinds of
insurance, is currently a named insured; or
  ' (c) In the case of group policies of insurance under which
coverage is individually underwritten, is a current certificate
holder.
  ' (24) 'Pretext interview' means an interview wherein the
interviewer, in an attempt to obtain information about a natural
person, does one or more of the following:
  ' (a) Pretends to be someone the interviewer is not.
  ' (b) Pretends to represent a person the interviewer is not in
fact representing.
  ' (c) Misrepresents the true purpose of the interview.
  ' (d) Refuses upon request to identify the interviewer.
  ' (25) 'Privileged information' means information which is
identifiable with an individual and which:
  ' (a) Relates to a claim for insurance benefits or a civil or
criminal proceeding involving the individual; and
  ' (b) Is collected in connection with or in reasonable
anticipation of a claim for insurance benefits or a civil or
criminal proceeding involving the individual.
  ' (26) 'Residual market mechanism' means an association,
organization or other entity involved in the insuring of risks
under ORS 735.005 to 735.145, 737.312 or other provisions of the
Insurance Code relating to insurance applicants who are unable to
procure insurance through normal insurance markets.
  ' (27) 'Termination of insurance coverage' or 'termination of
an insurance policy' means either a cancellation or a nonrenewal
of an insurance policy, in whole or in part, for any reason other
than the failure of a premium to be paid as required by the
policy.
  '  { +  SECTION 6. + } ORS 746.600, as amended by section 5 of
this 2003 Act, is amended to read:
  ' 746.600. As used in ORS 746.600 to 746.690 and 750.055:
  ' (1) 'Adverse underwriting decision' means, except as provided
in subsection (2) of this section, any of the following actions
with respect to insurance transactions involving insurance
coverage which is individually underwritten:
  ' (a) A declination of insurance coverage.
  ' (b) A termination of insurance coverage.
 
  ' (c) Failure of an agent to apply for insurance coverage with
a specific insurer which the agent represents and which is
requested by an applicant.
  ' (d) In the case of life or health insurance coverage, an
offer to insure at higher than standard rates.
  '  { - (e) In the case of individual health insurance coverage,
an offer to insure the applicant under a health benefit plan that
imposes a waiver of coverage for one or more preexisting
conditions for a period of time that is greater than six months
and less than 24 months following the applicant's effective date
of coverage. - }
  '  { - (f) - }   { + (e) + } In the case of other kinds of
insurance coverage:
  ' (A) Placement by an insurer or agent of a risk with a
residual market mechanism, an unauthorized insurer or an insurer
which specializes in substandard risks.
  ' (B) The charging of a higher rate on the basis of information
which differs from that which the applicant or policyholder
furnished.
  ' (2) 'Adverse underwriting decision' does not include the
following actions, but the insurer or agent responsible for the
occurrence of the action shall nevertheless provide the applicant
or policyholder with the specific reason or reasons for the
occurrence:
  ' (a) The termination of an individual policy form on a class
or statewide basis.
  ' (b) A declination of insurance coverage solely because the
coverage is not available on a class or statewide basis.
  ' (c) The rescission of a policy.
  ' (3) 'Affiliate of' a specified person or 'person affiliated
with' a specified person means a person who directly, or
indirectly, through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person
specified.
  ' (4) 'Agent' means a person licensed by the Director of the
Department of Consumer and Business Services as a resident or
nonresident insurance agent.
  ' (5) 'Applicant' means a person who seeks to contract for
insurance coverage, other than a person seeking group insurance
coverage which is not individually underwritten.
  ' (6) 'Consumer report' means any written, oral or other
communication of information bearing on a natural person's
creditworthiness, credit standing, credit capacity, character,
general reputation, personal characteristics or mode of living
which is used or expected to be used in connection with an
insurance transaction.
  ' (7) 'Consumer reporting agency' means a person who:
  ' (a) Regularly engages, in whole or in part, in assembling or
preparing consumer reports for a monetary fee;
  ' (b) Obtains information primarily from sources other than
insurers; and
  ' (c) Furnishes consumer reports to other persons.
  ' (8) 'Control' means, and the terms 'controlled by' or ' under
common control with' refer to, the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a person, whether through the
ownership of voting securities, by contract other than a
commercial contract for goods or nonmanagement services, or
otherwise, unless the power of the person is the result of a
corporate office held in, or an official position held with, the
controlled person.
  ' (9) 'Declination of insurance coverage' means a denial, in
whole or in part, by an insurer or agent of requested insurance
coverage.
  ' (10) 'Individual':
 
  ' (a) Means, for purposes of ORS 746.600 to 746.690 and
750.055, except as provided in paragraph (b) of this subsection,
a natural person who:
  ' (A) In the case of life or health insurance, is a past,
present or proposed principal insured or certificate holder;
  ' (B) In the case of other kinds of insurance, is a past,
present or proposed named insured or certificate holder;
  ' (C) Is a past, present or proposed policyowner;
  ' (D) Is a past or present applicant;
  ' (E) Is a past or present claimant; or
  ' (F) Derived, derives or is proposed to derive insurance
coverage under an insurance policy or certificate which is
subject to ORS 746.600 to 746.690 and 750.055.
  ' (b) Comprises, for purposes of ORS 746.620, 746.630 and
746.665, and for purposes of terms defined in this section as
those terms are used in ORS 746.620, 746.630 and 746.665, the
following categories of natural persons:
  ' (A) 'Consumer,' which means an individual, or the
individual's representative, who seeks to obtain, obtains or has
obtained an insurance product or service from a licensee that is
to be used primarily for personal, family or household purposes,
and about whom the licensee has personal information.
  ' (B) 'Customer,' which means a consumer who has a continuing
relationship with a licensee under which the licensee provides
one or more insurance products or services to the consumer that
are to be used primarily for personal, family or household
purposes.
  ' (11) 'Institutional source' means a person or governmental
entity which provides information about an individual to an
insurer, agent or insurance-support organization, other than:
  ' (a) An agent;
  ' (b) The individual who is the subject of the information; or
  ' (c) A natural person acting in a personal capacity rather
than in a business or professional capacity.
  ' (12) 'Insurance-support organization' means, except as
provided in subsection (13) of this section, a person who
regularly engages, in whole or in part, in assembling or
collecting information about natural persons for the primary
purpose of providing the information to an insurer or agent for
insurance transactions, including:
  ' (a) The furnishing of consumer reports to an insurer or agent
for use in connection with insurance transactions; and
  ' (b) The collection of personal information from insurers,
agents or other insurance-support organizations for the purpose
of detecting or preventing fraud, material misrepresentation or
material nondisclosure in connection with insurance underwriting
or insurance claim activity.
  ' (13) 'Insurance-support organization' does not include
insurers, agents, governmental institutions, medical care
institutions or medical professionals.
  ' (14) 'Insurance transaction' means any transaction involving
insurance primarily for personal, family or household needs
rather than business or professional needs and which entails:
  ' (a) The determination of an individual's eligibility for an
insurance coverage, benefit or payment; or
  ' (b) The servicing of an insurance application, policy or
certificate.
  ' (15) 'Insurer,' as defined in ORS 731.106, includes every
person engaged in the business of entering into policies of
insurance.
  ' (16) 'Investigative consumer report' means a consumer report,
or portion of a consumer report, for which information about a
natural person's character, general reputation, personal
characteristics or mode of living is obtained through personal
interviews with the person's neighbors, friends, associates,
 
acquaintances or others who may have knowledge concerning such
items of information.
  ' (17) 'Licensee' means an insurer, agent or other person
authorized or required to be authorized, or licensed or required
to be licensed, pursuant to the Insurance Code.
  ' (18) 'Medical care institution' means a facility or
institution which is licensed to provide health care services to
natural persons, and includes but is not limited to health
maintenance organizations, home health agencies, hospitals,
medical clinics, public health agencies, rehabilitation agencies
and skilled nursing facilities.
  ' (19) 'Medical professional' means a person licensed or
certified to provide health care services to natural persons, and
includes but is not limited to chiropractors, clinical
dieticians, clinical psychologists, dentists, naturopaths,
nurses, occupational therapists, optometrists, pharmacists,
physical therapists, physicians, podiatrists, psychiatric social
workers and speech therapists.
  ' (20) 'Medical record information' means personal information
except age or gender, whether oral or recorded in any form or
medium, created by or derived from a health care provider or the
consumer that relates to:
  ' (a) The past, present or future physical, mental or
behavioral health or condition of an individual;
  ' (b) The provision of health care to an individual; or
  ' (c) Payment for the provision of health care to an
individual.
  ' (21) 'Nonaffiliated third party' means any person except:
  ' (a) An affiliate of a licensee;
  ' (b) A person that is employed jointly by a licensee and by a
person that is not an affiliate of the licensee; and
  ' (c) As designated by the director by rule.
  ' (22) 'Personal information' means information which is
identifiable with an individual, which is gathered in connection
with an insurance transaction and from which information
judgments can be made about the individual's character, habits,
avocations, finances, occupations, general reputation, credit,
health or any other personal characteristics. 'Personal
information' includes an individual's name and address, an
individual's policy number or similar form of access code for the
individual's policy and ' medical record information' but does
not include 'privileged information' except for privileged
information which has been disclosed in violation of ORS 746.665.
'Personal information' does not include information that a
licensee has a reasonable basis to believe is lawfully made
available to the general public from federal, state or local
government records, widely distributed media or disclosures to
the public that are required by federal, state or local law.
  ' (23) 'Policyholder' means a person who:
  ' (a) In the case of individual policies of life or health
insurance, is a current policyowner;
  ' (b) In the case of individual policies of other kinds of
insurance, is currently a named insured; or
  ' (c) In the case of group policies of insurance under which
coverage is individually underwritten, is a current certificate
holder.
  ' (24) 'Pretext interview' means an interview wherein the
interviewer, in an attempt to obtain information about a natural
person, does one or more of the following:
  ' (a) Pretends to be someone the interviewer is not.
  ' (b) Pretends to represent a person the interviewer is not in
fact representing.
  ' (c) Misrepresents the true purpose of the interview.
  ' (d) Refuses upon request to identify the interviewer.
  ' (25) 'Privileged information' means information which is
identifiable with an individual and which:
  ' (a) Relates to a claim for insurance benefits or a civil or
criminal proceeding involving the individual; and
  ' (b) Is collected in connection with or in reasonable
anticipation of a claim for insurance benefits or a civil or
criminal proceeding involving the individual.
  ' (26) 'Residual market mechanism' means an association,
organization or other entity involved in the insuring of risks
under ORS 735.005 to 735.145, 737.312 or other provisions of the
Insurance Code relating to insurance applicants who are unable to
procure insurance through normal insurance markets.
  ' (27) 'Termination of insurance coverage' or 'termination of
an insurance policy' means either a cancellation or a nonrenewal
of an insurance policy, in whole or in part, for any reason other
than the failure of a premium to be paid as required by the
policy.
  '  { +  SECTION 7. + }  { + The amendments to ORS 746.600 by
section 6 of this 2003 Act become operative on January 2,
2008. + } ' .
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