75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 789
Minority Report
B-Engrossed
House Bill 2194
Ordered by the Senate June 5
Including House Amendments dated February 17 and Senate Minority
Report Amendments dated June 5
Sponsored by nonconcurring members of the Senate Committee on
Health Care and Veterans' Affairs: Senators KRUSE, MORSE
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.
Modifies definition of 'medical insurance' for purposes of
Oregon Medical Insurance Pool. { + Defines 'covered life' for
purposes related to insurance coverage. + } Establishes majority
of voting members of Oregon Medical Insurance Pool Board as
quorum. { + Authorizes board to impose assessment on third party
administrators on and after January 1, 2011. + } Specifies types
of insureds excluded from calculation of assessment. Prohibits
coverage of person through Oregon Medical Insurance Pool if
public health entity or health care provider pays premium for
person and payment reduces financial loss of entity or provider
even if reduction of loss is not sole purpose for payment.
Modifies requirements for portability health benefit plan
coverage under pool by removing requirement to reside in Oregon
for 180 days. { + Confers jurisdiction on Supreme Court of
Oregon for specified challenges to Act. + }
A BILL FOR AN ACT
Relating to Oregon Medical Insurance Pool; creating new
provisions; and amending ORS 735.605, 735.610, 735.614,
735.615, 735.616, 735.650, 735.756, 744.704 and 744.714.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Section 2 of this 2009 Act is added to and made
a part of the Insurance Code. + }
SECTION 2. { + ' Covered life' means a subscriber,
policyholder, certificate holder, spouse, dependent child or any
other individual insured under an insurance policy or whose
benefits are administered by a third party administrator. + }
SECTION 3. ORS 735.605 is amended to read:
735.605. As used in ORS 735.600 to 735.650:
(1) 'Benefits plan' means the coverages to be offered by the
pool to eligible persons pursuant to ORS 735.600 to 735.650.
(2) 'Board' means the Oregon Medical Insurance Pool Board.
(3) 'Insured' means any individual resident of this state who
is eligible to receive benefits from any insurer.
(4) 'Insurer' means:
(a) Any insurer as defined in ORS 731.106 or fraternal benefit
society as defined in ORS 748.106 required to have a certificate
of authority to transact health insurance business in this state,
and any health care service contractor as defined in ORS 750.005
{ - , issuing medical insurance in this state on or after
September 27, 1987 - } .
(b) Any reinsurer reinsuring medical insurance in this state
{ - on or after September 27, 1987 - } .
(c) To the extent consistent with federal law, any
self-insurance arrangement covered by the Employee Retirement
Income Security Act of 1974, as amended, that provides health
care benefits in this state { - on or after September 27,
1987 - } .
(d) All self-insurance arrangements not covered by the Employee
Retirement Income Security Act of 1974, as amended, that provides
health care benefits in this state { - on or after September
27, 1987 - } .
(5) 'Medical insurance' means { - any health insurance
benefits payable on the basis of hospital, surgical or medical
expenses incurred and any health care service contractor
subscriber contract. Medical insurance does not include accident
only, disability income, hospital confinement indemnity, dental
or credit insurance, coverage issued as a supplement to liability
insurance, coverage issued as a supplement to Medicare, insurance
arising out of a workers' compensation or similar law, automobile
medical-payment insurance or insurance under which benefits are
payable with or without regard to fault and which is statutorily
required to be contained in any liability insurance policy or
equivalent self-insurance. - } { + insurance of humans against
bodily injury, disablement or death by accident or accidental
means, or the expense thereof, or against disablement or expense
resulting from sickness or childbirth, or against expense
incurred in prevention of sickness, in dental care or
optometrical service, and every insurance appertaining thereto,
including insurance against the risk of economic loss assumed
under a less than fully insured employee health benefit plan.
'Medical insurance' does not include workers' compensation
coverages. + }
(6) 'Medicare' means coverage under Part A, Part B and Part D
of Title XVIII of the Social Security Act, 42 U.S.C.
{ - 1395 - } { + 1395c + } et seq., as amended.
(7) 'Plan of operation' means the plan of operation of the
pool, including articles, bylaws and operating rules, adopted by
the board pursuant to ORS 735.600 to 735.650.
(8) 'Pool' means the Oregon Medical Insurance Pool as created
by ORS 735.610.
(9) 'Reinsurer' means any insurer as defined in ORS 731.106
from whom any person providing medical insurance to Oregon
insureds procures insurance for itself in the insurer, with
respect to all or part of the medical insurance risk of the
person. { + ' Reinsurer' includes an insurer providing
insurance against the risk of economic loss. + }
(10) 'Self-insurance arrangement' means any plan, program,
contract or any other arrangement under which one or more
employers, unions or other organizations provide health care
services or benefits to their employees or members in this state,
either directly or indirectly through a trust or third party
administrator, unless the health care services or benefits are
provided by an insurance policy issued by an insurer other than a
self-insurance arrangement.
{ + (11) 'Third party administrator' means any person
required to obtain a license pursuant to ORS 744.702. + }
SECTION 4. ORS 735.610 is amended to read:
735.610. (1) There is created in the Department of Consumer and
Business Services the Oregon Medical Insurance Pool Board. The
board shall establish the Oregon Medical Insurance Pool and
otherwise carry out the responsibilities of the board under ORS
735.600 to 735.650.
(2) The board shall consist of nine individuals, eight of whom
shall be appointed by the Director of the Department of Consumer
and Business Services. The director { - of the Department of
Consumer and Business Services - } or the director's designee
shall be { - a - } { + the ninth + } member of the board. The
chair of the board shall be elected from among the members of the
board. The board shall at all times, to the extent possible,
include at least one representative of a domestic insurance
company licensed to transact health insurance, one representative
of a domestic not-for-profit health care service contractor, one
representative of a health maintenance organization, one
representative of reinsurers and two members of the general
public who are not associated with the medical profession, a
hospital or an insurer. { + A majority of the voting members
of the board constitutes a quorum for the transaction of
business. An act by a majority of a quorum is an official act of
the board. + }
(3) The director may fill any vacancy on the board by
appointment.
(4) The board shall have the general powers and authority
granted under the laws of this state to insurance companies with
a certificate of authority to transact health insurance and the
specific authority to:
(a) Enter into such contracts as are necessary or proper to
carry out the provisions and purposes of ORS 735.600 to 735.650
including the authority to enter into contracts with similar
pools of other states for the joint performance of common
administrative functions, or with persons or other organizations
for the performance of administrative functions;
(b) Recover any assessments { - for, on behalf of, or against
insurers; - } { + from insurers and reinsurers; + }
(c) Take such legal action as is necessary to avoid the payment
of improper claims against the pool or the coverage provided by
or through the pool;
(d) Establish appropriate rates, rate schedules, rate
adjustments, expense allowances, insurance producers' referral
fees, claim reserves or formulas and perform any other actuarial
function appropriate to the operation of the pool. Rates may not
be unreasonable in relation to the coverage provided, the risk
experience and expenses of providing the coverage. Rates and rate
schedules may be adjusted for appropriate risk factors such as
age and area variation in claim costs and shall take into
consideration appropriate risk factors in accordance with
established actuarial and underwriting practices;
(e) Issue policies of insurance in accordance with the
requirements of ORS 735.600 to 735.650;
(f) Appoint { - from among insurers - } appropriate
actuarial and other committees as necessary to provide technical
assistance in the operation of the pool, policy and other
contract design, and any other function within the authority of
the board;
(g) Seek advances to effect the purposes of the pool; and
(h) Establish rules, conditions and procedures for reinsuring
risks under ORS 735.600 to 735.650.
(5) Each member of the board is entitled to compensation and
expenses as provided in ORS 292.495.
(6) The director { - of the Department of Consumer and
Business Services - } shall adopt rules, as provided under ORS
chapter 183, implementing policies recommended by the board for
the purpose of carrying out ORS 735.600 to 735.650.
(7) In consultation with the board, the director shall employ
such staff and consultants as may be necessary for the purpose of
carrying out responsibilities under ORS 735.600 to 735.650.
SECTION 5. ORS 735.610, as amended by section 4 of this 2009
Act, is amended to read:
735.610. (1) There is created in the Department of Consumer and
Business Services the Oregon Medical Insurance Pool Board. The
board shall establish the Oregon Medical Insurance Pool and
otherwise carry out the responsibilities of the board under ORS
735.600 to 735.650.
(2) The board shall consist of nine individuals, eight of whom
shall be appointed by the Director of the Department of Consumer
and Business Services. The director or the director's designee
shall be the ninth member of the board. The chair of the board
shall be elected from among the members of the board. The board
shall at all times, to the extent possible, include at least one
representative of a domestic insurance company licensed to
transact health insurance, one representative of a domestic
not-for-profit health care service contractor, one representative
of a health maintenance organization, one representative of
reinsurers and two members of the general public who are not
associated with the medical profession, a hospital or an insurer.
A majority of the voting members of the board constitutes a
quorum for the transaction of business. An act by a majority of a
quorum is an official act of the board.
(3) The director may fill any vacancy on the board by
appointment.
(4) The board shall have the general powers and authority
granted under the laws of this state to insurance companies with
a certificate of authority to transact health insurance and the
specific authority to:
(a) Enter into such contracts as are necessary or proper to
carry out the provisions and purposes of ORS 735.600 to 735.650
including the authority to enter into contracts with similar
pools of other states for the joint performance of common
administrative functions, or with persons or other organizations
for the performance of administrative functions;
(b) Recover any assessments from insurers { + , + }
{ - and - } reinsurers { + and third party
administrators + };
(c) Take such legal action as is necessary to avoid the payment
of improper claims against the pool or the coverage provided by
or through the pool;
(d) Establish appropriate rates, rate schedules, rate
adjustments, expense allowances, insurance producers' referral
fees, claim reserves or formulas and perform any other actuarial
function appropriate to the operation of the pool. Rates may not
be unreasonable in relation to the coverage provided, the risk
experience and expenses of providing the coverage. Rates and rate
schedules may be adjusted for appropriate risk factors such as
age and area variation in claim costs and shall take into
consideration appropriate risk factors in accordance with
established actuarial and underwriting practices;
(e) Issue policies of insurance in accordance with the
requirements of ORS 735.600 to 735.650;
(f) Appoint appropriate actuarial and other committees as
necessary to provide technical assistance in the operation of the
pool, policy and other contract design, and any other function
within the authority of the board;
(g) Seek advances to effect the purposes of the pool; and
(h) Establish rules, conditions and procedures for reinsuring
risks under ORS 735.600 to 735.650.
(5) Each member of the board is entitled to compensation and
expenses as provided in ORS 292.495.
(6) The director shall adopt rules, as provided under ORS
chapter 183, implementing policies recommended by the board for
the purpose of carrying out ORS 735.600 to 735.650.
(7) In consultation with the board, the director shall employ
such staff and consultants as may be necessary for the purpose of
carrying out responsibilities under ORS 735.600 to 735.650.
SECTION 6. ORS 735.614 is amended to read:
735.614. (1) If the Oregon Medical Insurance Pool Board
determines at any time that funds in the Oregon Medical Insurance
Pool Account are or will become insufficient for { + timely + }
payment of expenses of the pool { - in a timely manner - } ,
the board shall determine the amount of funds needed and shall
impose { - and collect assessments against insurers, as
provided in this section, in the amount of the funds determined
to be needed. - } { + upon and collect from insurers and
reinsurers assessments calculated in accordance with subsection
(2) of this section. + }
(2) { - Each insurer's assessment shall be determined by
multiplying the total amount to be assessed by a fraction, the
numerator of which equals the number of Oregon insureds and
certificate holders insured or reinsured by each insurer, and the
denominator of which equals the total of all Oregon insureds and
certificate holders insured or reinsured by all insurers, all
determined as of March 31 each year. - } { + The board shall
calculate the assessment of each insurer and reinsurer based on
the total amount needed to ensure timely payment of pool
expenses. The board will assess each insurer and reinsurer based
on its fractional share of all covered lives in Oregon as of
March 31 each year. + }
(3) { - The board shall ensure that each insured and
certificate holder is counted only once with respect to any
assessment. For that purpose, the board shall require each
insurer that obtains reinsurance for its insureds and certificate
holders to include in its count of insureds and certificate
holders all insureds and certificate holders whose coverage is
reinsured in whole or part. The board shall allow an insurer who
is a reinsurer to exclude from its number of insureds those that
have been counted by the primary insurer or the primary reinsurer
for the purpose of determining its assessment under this
subsection. - } { + With respect to an assessment, the board
shall count each covered life only once. For that purpose, the
board shall obtain counts from:
(a) An insurer of each covered life under all fully or less
than fully insured employee health benefit plans of the insurer;
(b) A third party administrator of each covered life under a
self-insurance plan using the third party administrator; and
(c) A reinsurer of each covered life reinsured under
self-insurance plans that do not use a third party administrator.
(4) If an individual is covered under a self-insurance plan
that does not use a third party administrator or the board cannot
identify a third party administrator for the plan, and the
individual is reinsured by a reinsurer, the board shall assess
the reinsurer for that individual. + }
{ - (4) - } { + (5) + } Each insurer { + or reinsurer + }
shall pay its assessment
{ - as required by the board. - } { + under this section.
Insureds under the following types of coverage, as defined by
rule by the board, are excluded in the calculation of the
assessment:
(a) Medicaid;
(b) State Children's Health Insurance Program;
(c) Medicare;
(d) Disability income insurance;
(e) Hospital only insurance;
(f) Dental insurance;
(g) Vision only insurance;
(h) Accident only insurance;
(i) Automobile insurance;
(j) Specific disease insurance;
(k) Medical supplemental plans;
(L) TRICARE;
(m) CHAMPUS;
(n) Prescription drug only plans;
(o) Long term care insurance; and
(p) Federal Employees Health Benefits Program. + }
{ - (5) - } { + (6) + } If assessments exceed the amounts
actually needed, the excess shall be held and invested and, with
the earnings and interest, used by the board to offset future net
losses or to reduce pool premiums. For purposes of this
subsection, 'future net losses' includes reserves for claims
incurred but not reported.
{ - (6) - } { + (7) + } { - Each insurer's proportion of
participation in the pool shall be determined by the board - }
{ + The board shall determine the fractional share for each
insurer and reinsurer of all covered lives in Oregon + } based on
annual statements and other reports deemed necessary by the board
and filed by the insurer { + or reinsurer + } with the
board { + or with the Department of Consumer and Business
Services + }. The board may use any reasonable method of
estimating the number of { - insureds and certificate holders
of an insurer - } { + covered lives + } if the specific number
is unknown. { - With respect to insurers that are reinsurers,
the board may use any reasonable method of estimating the number
of persons insured by each reinsurer. - }
{ - (7) - } { + (8) + } The board may abate or defer, in
whole or in part, the assessment { - of an insurer if, in the
opinion of the board, - } { + calculated under subsection (2) of
this section if the board determines that + } payment of the
assessment would endanger the ability of the insurer { + or
reinsurer + } to fulfill { - the insurer's - } { + its + }
contractual obligations. In the event an assessment { - against
an insurer - } is abated or deferred in whole or in part { +
under this subsection + }, the amount by which the assessment is
abated or deferred may be assessed against the other
{ - insurers in a manner consistent with the basis for
assessments set forth in this section. - } { + insurers and
reinsurers subject to the assessment in a manner consistent with
subsection (2) of this section. + } The insurer { + or
reinsurer + } receiving the abatement or deferment shall remain
liable to the board for the deficiency for four years.
{ - (8) - } { + (9) + } The board shall abate or defer
assessments authorized by this section if a court orders that
assessments cannot be made applicable to reinsurers. However, if
a court orders that assessments cannot be made applicable to
reinsurers, the board may continue to assess insurers to the end
of the biennium in which the determination is made.
{ - (9) - } { + (10) + } Subject to the approval of the
Director of the Department of Consumer and Business Services, the
board may develop a program for adjusting the assessment of an
insurer { - in the individual health benefits market based on
that insurer's contribution to reducing the - } { + or
reinsurer based on the contribution of that insurer or reinsurer
to reducing the demand for + } enrollment in the Oregon Medical
Insurance Pool. When developing the program, the board may
consider, but is not limited to, the following factors:
(a) The { - insurer's - } level of participation { + of the
insurer or reinsurer + };
(b) Level of health benefit plan coverage offered; and
(c) Assumption of risk in the individual health benefits
market.
SECTION 7. ORS 735.614, as amended by section 6 of this 2009
Act, is amended to read:
735.614. (1) If the Oregon Medical Insurance Pool Board
determines at any time that funds in the Oregon Medical Insurance
Pool Account are or will become insufficient for timely payment
of expenses of the pool, the board shall determine the amount of
funds needed and shall impose upon and collect from
insurers { + , + }
{ - and - } reinsurers { + and third party administrators + }
assessments calculated in accordance with subsection (2) of this
section.
(2) The board shall calculate the assessment of each
insurer { + , + }
{ - and - } reinsurer { + and third party administrator + }
based on the total amount needed to ensure timely payment of pool
expenses. The board will assess each insurer { + , + }
{ - and - } reinsurer { + and third party administrator + }
based on its fractional share of all covered lives in Oregon as
of March 31 each year.
(3) With respect to an assessment, the board shall count each
covered life only once. For that purpose, the board shall obtain
counts from:
(a) An insurer of each covered life under all fully or less
than fully insured employee health benefit plans of the insurer;
(b) A third party administrator of each covered life under a
self-insurance plan using the third party administrator; and
(c) A reinsurer of each covered life reinsured under
self-insurance plans that do not use a third party administrator.
(4) If an individual is covered under a self-insurance plan
that does not use a third party administrator or the board cannot
identify a third party administrator for the plan, and the
individual is reinsured by a reinsurer, the board shall assess
the reinsurer for that individual.
(5) Each insurer { + , + } { - or - } reinsurer { + and
third party administrator + } shall pay its assessment under this
section. Insureds under the following types of coverage, as
defined by rule by the board, are excluded in the calculation of
the assessment:
(a) Medicaid;
(b) State Children's Health Insurance Program;
(c) Medicare;
(d) Disability income insurance;
(e) Hospital only insurance;
(f) Dental insurance;
(g) Vision only insurance;
(h) Accident only insurance;
(i) Automobile insurance;
(j) Specific disease insurance;
(k) Medical supplemental plans;
(L) TRICARE;
(m) CHAMPUS;
(n) Prescription drug only plans;
(o) Long term care insurance; and
(p) Federal Employees Health Benefits Program.
(6) If assessments exceed the amounts actually needed, the
excess shall be held and invested and, with the earnings and
interest, used by the board to offset future net losses or to
reduce pool premiums. For purposes of this subsection, 'future
net losses' includes reserves for claims incurred but not
reported.
(7) The board shall determine the fractional share for each
insurer { + , + } { - and - } reinsurer { + and third party
administrator + } of all covered lives in Oregon based on annual
statements and other reports deemed necessary by the board and
filed by the insurer { + , + }
{ - or - } reinsurer { + or third party administrator + }
with the board or with the Department of Consumer and Business
Services. The board may use any reasonable method of estimating
the number of covered lives if the specific number is unknown.
(8) The board may abate or defer, in whole or in part, the
assessment calculated under subsection (2) of this section if the
board determines that payment of the assessment would endanger
the ability of the insurer { + , + } { - or - } reinsurer { +
or third party administrator + } to fulfill its contractual
obligations. In the event an assessment is abated or deferred in
whole or in part under this subsection, the amount by which the
assessment is abated or deferred may be assessed against the
other insurers { + , + } { - and - } reinsurers { + and third
party administrators + } subject to the assessment in a manner
consistent with subsection (2) of this section. The
insurer { + , + } { - or - } reinsurer { + or third party
administrator + } receiving the abatement or deferment shall
remain liable to the board for the deficiency for four years.
(9) { - The board shall abate or defer assessments authorized
by this section if a court orders that assessments cannot be made
applicable to reinsurers. However, if a court orders that
assessments cannot be made applicable to reinsurers, the board
may continue to assess insurers to the end of the biennium in
which the determination is made. - } { + If a court finds that
an assessment imposed on a third party administrator is in
violation of federal or state law, the board shall abate or defer
the assessment imposed upon the third party administrator but may
continue to impose and collect assessments on insurers,
reinsurers and other third party administrators. + }
(10) Subject to the approval of the Director of the Department
of Consumer and Business Services, the board may develop a
program for adjusting the assessment of an insurer { + , + }
{ - or - } reinsurer { + or third party administrator + } based
on the contribution of that insurer { + , + } { - or - }
reinsurer { + or third party administrator + } to reducing the
demand for enrollment in the Oregon Medical Insurance Pool. When
developing the program, the board may consider, but is not
limited to, the following factors:
(a) The level of participation of the insurer { + , + }
{ - or - } reinsurer { + or third party administrator + };
(b) Level of health benefit plan coverage offered; and
(c) Assumption of risk in the individual health benefits
market.
SECTION 8. ORS 735.615 is amended to read:
735.615. (1) Except as provided in subsection (3) of this
section, a person who is a resident of this state, as defined by
the Oregon Medical Insurance Pool Board, is eligible for medical
pool coverage if:
(a) An insurer, or an insurance company with a certificate of
authority in any other state, has made within a time frame
established by the board an adverse underwriting decision, as
defined in ORS 746.600 (1)(a)(A), (B) or (D), on individual
medical insurance for health reasons while the person was a
resident;
(b) The person has a history of any medical or health
conditions on the list adopted by the board under subsection (2)
of this section;
(c) The person is a spouse or dependent of a person described
in paragraph (a) or (b) of this subsection; or
(d) The person is eligible for the credit for health insurance
costs under section 35 of the federal Internal Revenue Code, as
amended and in effect on December 31, 2004.
(2) The board may adopt a list of medical or health conditions
for which a person is eligible for pool coverage without applying
for individual medical insurance pursuant to this section.
(3) A person is not eligible for coverage under ORS 735.600 to
735.650 if:
(a) Except as provided in ORS 735.625 (3)(c), the person is
eligible to receive health services as defined in ORS 414.705
that meet or exceed those adopted by the board or is eligible for
Medicare;
(b) The person has terminated coverage in the pool within the
last 12 months and the termination was for:
(A) A reason other than becoming eligible to receive health
services as defined in ORS 414.705; or
(B) A reason that does not meet exception criteria established
by the board;
(c) The person has exceeded the maximum lifetime benefit
established by the board;
(d) The person is an inmate of or a patient in a public
institution named in ORS 179.321;
(e) The person has, on the date of issue of coverage by the
board, coverage under health insurance or a self-insurance
arrangement that is substantially equivalent to coverage under
ORS 735.625; or
(f) The person has the premiums paid or reimbursed by a public
entity or a health care provider { + , + } { - for the sole
purpose of - } reducing the financial loss or obligation of the
payer.
(4) A person applying for coverage shall establish initial
eligibility by providing evidence that the board requires.
(5)(a) Notwithstanding ORS 735.625 (4)(c) and subsection (3)(a)
of this section, if a person becomes eligible for Medicare after
being enrolled in the pool for a period of time as determined by
the board by rule, that person may continue coverage within the
pool as secondary coverage to Medicare.
(b) The board may adopt rules concerning the terms and
conditions for the coverage provided under paragraph (a) of this
subsection.
(6) The board may adopt rules to establish additional
eligibility requirements for a person described in subsection
(1)(d) of this section.
SECTION 9. ORS 735.616 is amended to read:
735.616. { + (1) An applicant may qualify for portability
health insurance coverage under the Oregon Medical Insurance Pool
if:
(a) An application for coverage is made not later than the 63rd
day after the date of first eligibility; and
(b) The individual is an Oregon resident at the time of the
application. + }
{ - (1) - } { + (2) + } In addition to individuals
otherwise qualified under ORS 735.615, the following individuals
qualify for portability health insurance coverage under the
Oregon Medical Insurance Pool { - if an application for
coverage is made not later than the 63rd day after the date of
first eligibility, as provided in subsection (2) of this section,
and the individual is an Oregon resident at the time of such
application - } :
(a) An individual who has left coverage that was
{ - continuously - } in effect for a { - period - } { +
minimum + } of 180 { + consecutive + } days { - or more - }
under one or more group health benefit plans, if { - : - }
{ - (A) - } the terminated coverage was in a plan issued or
established in a state other than Oregon; { - and - }
{ - (B) The individual was an Oregon resident for at least
180 consecutive days immediately prior to the termination of
coverage; - }
(b) An eligible individual, as defined in ORS 743.760, who has
left coverage under a group health benefit plan or a portability
health benefit plan and whose carrier cannot offer a portability
plan under ORS 743.760 (6) because of:
(A) A change in residence of the eligible individual within
Oregon;
(B) A change in the geographic area served by the group
carrier; or
(C) The carrier's withdrawal from the group market in Oregon in
accordance with ORS 743.737 and 743.754;
(c) An individual who has left coverage that was
{ - continuously - } in effect for { - a - } { + an
uninterrupted + } period of 180 days or more under one or more
Oregon group health benefit plans and the terminated coverage was
provided by:
(A) An employee welfare benefit plan that is exempt from state
regulation under the federal Employee Retirement Income Security
Act of 1974, as amended;
(B) A multiple employer welfare arrangement subject to ORS
750.301 to 750.341; or
(C) A public body of this state in accordance with ORS 731.036;
and
(d) On or after January 1, 1998, an individual who meets the
eligibility requirements of 42 U.S.C. 300gg-41, as amended and in
effect on January 1, 1998, and does not otherwise qualify to
obtain portability coverage from an Oregon group carrier in
accordance with ORS 743.760.
{ - (2) - } { + (3) + } Eligibility for coverage pursuant
to { - subsection (1) - } { + subsections (1) and (2) + } of
this section is subject to the following provisions:
(a) An eligible individual does not include:
(A) An individual who remains eligible for the individual's
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;
(B) An individual who is covered under another health benefit
plan at the time that portability coverage would commence;
(C) An individual who is eligible to enroll in another health
benefit plan offered by the employer, other than as a late
enrollee, at the time that portability coverage would commence;
or
(D) An individual who is eligible for the federal Medicare
program.
(b) If an eligible individual has left group coverage issued by
an insurance company, a health care service contractor or a
health maintenance organization, the date of first eligibility is
the day following the termination date of the group coverage,
including any period of continuation coverage that was elected by
the individual under federal law or under ORS 743.600 or 743.610.
(c) If an eligible individual has left group coverage issued by
an entity other than an insurance company, a health care service
contractor or a health maintenance organization, the date of
first eligibility is the day following the termination date of
the group coverage, including the full extent of continuation
coverage available to the individual under federal law and ORS
743.600 and 743.610.
(d) If an individual is eligible for coverage pursuant to
subsection { - (1)(b) - } { + (2)(b) + } of this section, the
date of first eligibility is the day following the loss of the
group or portability coverage.
{ - (3) - } { + (4) + } Coverage under the Oregon Medical
Insurance Pool pursuant to { - subsection (1) - }
{ + subsections (1) and (2) + } of this section shall be offered
according to the following provisions:
(a) Coverage is subject to ORS 743.760 (2) and (8);
(b) Coverage may not be subject to a preexisting conditions
provision, exclusion period, waiting period, residency period or
other similar limitation on coverage; and
(c) The individual shall be required to pay a premium rate not
more than the applicable portability risk rate determined by the
Oregon Medical Insurance Pool Board pursuant to ORS 735.625.
SECTION 10. ORS 735.650 is amended to read:
735.650. (1) The following provisions of the Insurance Code
shall apply to the pool to the extent applicable and not
inconsistent with the express provisions of ORS 735.600 to
735.650: ORS 731.004 to 731.022, 731.052 to 731.146, 731.162,
731.216 to 731.328, 742.023, 742.028, 742.046, 742.051, 742.056,
743.024, 743.027, 743.028, 743.041, 743.050, 743.100 to 743.106,
743.402, 743.801, 743.803, 743.804, 743.806, 743.807, 743.808,
743.811, 743.814, 743.817, 743.819, 743.821, 743.823, 743.827,
743.829, 743.834, 743.837, 743.839, 743.845, 743A.084, 743A.090,
{ + 744.702, 744.704, 744.724, 744.738, + } 746.005 to 746.370,
746.600, 746.605, 746.607, 746.608, 746.610, 746.615, 746.625,
746.635, 746.650, 746.655, 746.660, 746.668, 746.670, 746.675,
746.680 and 746.690.
(2) For the purposes of this section only, the pool shall be
deemed an insurer, pool coverage shall be deemed individual
health insurance and pool coverage contracts shall be deemed
policies.
SECTION 11. ORS 744.704 is amended to read:
744.704. (1) The following persons are exempt from the
licensing requirement for third party administrators in ORS
744.702 and from all other provisions of ORS 744.700 to 744.740
applicable to third party administrators:
(a) A person licensed under ORS 744.002 as an adjuster, whose
activities are limited to adjustment of claims and whose
activities do not include the activities of a third party
administrator.
(b) A person licensed as an insurance producer as required by
ORS 744.053 and authorized to transact life or health insurance
in this state, whose activities are limited exclusively to the
sale of insurance and whose activities do not include the
activities of a third party administrator.
(c) An employer acting as a third party administrator on behalf
of:
(A) Its employees;
(B) The employees of one or more subsidiary or affiliated
corporations of the employer; or
(C) The employees of one or more persons with a dealership,
franchise, distributorship or other similar arrangement with the
employers.
(d) A union, or an affiliate thereof, acting as a third party
administrator on behalf of its members.
(e) An insurer that is authorized to transact insurance in this
state with respect to a policy issued and delivered in and
pursuant to the laws of this state or another state.
(f) A creditor acting on behalf of its debtors with respect to
insurance covering a debt between the creditor and its debtors.
(g) A trust and the trustees, agents and employees of the
trust, when acting pursuant to the trust, if the trust is
established in conformity with 29 U.S.C. 186.
(h) A trust exempt from taxation under section 501(a) of the
Internal Revenue Code, its trustees and employees acting pursuant
to the trust, or a voluntary employees beneficiary association
described in section 501(c) of the Internal Revenue Code, its
agents and employees and a custodian and the custodian's agents
and employees acting pursuant to a custodian account meeting the
requirements of section 401(f) of the Internal Revenue Code.
(i) A financial institution that is subject to supervision or
examination by federal or state financial institution regulatory
authorities, or a mortgage lender, to the extent the financial
institution or mortgage lender collects and remits premiums to
licensed insurance producers or authorized insurers in connection
with loan payments.
(j) A company that issues credit cards and advances for and
collects premiums or charges from its credit card holders who
have authorized collection. The exemption under this paragraph
applies only if the company does not adjust or settle claims.
(k) A person who adjusts or settles claims in the normal course
of practice or employment as an attorney at law. The exemption
under this subsection applies only if the person does not collect
charges or premiums in connection with life insurance or health
insurance coverage.
{ - (L) A person who acts solely as an administrator of one
or more bona fide employee benefit plans established by an
employer or an employee organization, or both, for which the
Insurance Code is preempted pursuant to the Employee Retirement
Income Security Act of 1974. A person to whom this paragraph
applies must comply with the requirements of ORS 744.714. - }
{ - (m) - } { + (L) + } The Oregon Medical Insurance Pool
Board, established under ORS 735.600 to 735.650, and the
administering insurer or insurers for the board, for services
provided pursuant to ORS 735.600 to 735.650.
{ - (n) - } { + (m) + } An entity or association owned by
or composed of like employers who administer partially or fully
self-insured plans for employees of the employers or association
members.
{ - (o) - } { + (n) + } A trust established by a
cooperative body formed between cities, counties, districts or
other political subdivisions of this state, or between any
combination of such entities, and the trustees, agents and
employees acting pursuant to the trust.
{ - (p) - } { + (o) + } Any person designated by the
Director of the Department of Consumer and Business Services by
rule.
(2) A third party administrator is not required to be licensed
as a third party administrator in this state if the following
conditions are met:
(a) The third party administrator has its principal place of
business in another state;
(b) The third party administrator is not soliciting business as
a third party administrator in this state; and
(c) In the case of any group policy or plan of insurance
serviced by the third party administrator, the lesser of five
percent or 100 certificate holders reside in this state.
SECTION 12. ORS 735.756 is amended to read:
735.756. (1) Of payments made to the Family Health Insurance
Assistance Program by the Department of Human Services under ORS
735.754 (4), the department shall determine:
(a) The portion of a subsidy of a subsidized member that is
from the General Fund; and
(b) The portion of other costs that is from the General Fund.
(2) The department shall bill the program for the amounts
determined under subsection (1) of this section. The program
shall forward the bill for the amount determined under subsection
(1)(b) of this section to the Oregon Medical Insurance Pool
Board.
(3) The board shall:
(a) Determine the amount of funds needed for the payment of
other costs under subsection (1)(b) of this section; and
(b) Impose and collect assessments in that amount against
insurers, using the methodology described in ORS 735.614 (2),
{ - (6) and (9) - } { + (7) and (10) + }.
(4) The board shall pay the program for the amounts determined
under subsection (1)(b) of this section.
(5) The program shall forward to the department the amounts
determined under subsection (1) of this section.
(6) ORS 735.614 (3), { - (4), (5), (7) and (8) - } { + (5),
(6), (8) and (9) + } applies to assessments collected under this
section.
SECTION 13. ORS 744.714 is amended to read:
744.714. A person who is exempt from the requirement of a
license as a third party administrator under { - ORS 744.704
because the person acts solely as an administrator of one or more
bona fide employee benefit plans established by an employer or an
employee organization, or both, for which the Insurance Code is
preempted pursuant to the Employee Retirement Income Security Act
of 1974, - } { + ORS 744.702 + } shall register with the
Director of the Department of Consumer and Business Services
annually, verifying the status of the person as qualifying for
the exemption.
SECTION 14. { + (1) Jurisdiction is conferred on the Supreme
Court to determine in the manner provided by this section whether
the provisions of this 2009 Act are preempted by federal law or
violate any constitutional provision, including but not limited
to impairment of the obligation of contracts under section 21,
Article I of the Oregon Constitution, or clause 1, section 10,
Article I of the United States Constitution.
(2) A person who is adversely affected by this 2009 Act or who
will be adversely affected by this 2009 Act may institute a
proceeding for review by filing with the Supreme Court a petition
that meets the following requirements:
(a) The petition must be filed within 60 days after the
effective date of this 2009 Act or, with respect to the
amendments to ORS 735.610 and 735.614 by sections 5 and 7 of this
2009 Act, on or before March 1, 2010.
(b) The petition must include the following:
(A) A statement of the basis of the challenge; and
(B) A statement and supporting affidavit showing how the
petitioner is adversely affected.
(3) The petitioner shall serve a copy of the petition by
registered or certified mail upon the Department of Consumer and
Business Services, the Attorney General and the Governor.
(4) Proceedings for review under this section shall be
expedited and given priority over all other matters before the
Supreme Court.
(5) In the event the Supreme Court determines that there are
factual issues in the petition, the Supreme Court may appoint a
special master to hear evidence and to prepare recommended
findings of fact. + }
SECTION 15. { + The amendments to ORS 735.610 and 735.614 by
sections 5 and 7 of this 2009 Act become operative on January 1,
2011. + }
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