Chapter 632

632.749(3)(b)1. 1. The insurer provides notice of the discontinuance to the commissioner and to each employer and, if applicable, plan sponsor for whom the insurer provides coverage of this type in this state, and to the participants and beneficiaries covered under the coverage, at least 180 days before the date on which the coverage will be discontinued.

632.749(3)(b)2. 2. All group health benefit plans issued or delivered for issuance in this state in the affected market or markets are discontinued and coverage under such group health benefit plans is not renewed.

632.749(3)(b)3. 3. The insurer does not issue or deliver for issuance in this state any group health benefit plan in the affected market or markets before 5 years after the day on which the last group health benefit plan is discontinued under subd. 2.

632.749(4) (4) This section does not apply to a group health benefit plan offered by the state under s. 40.51 (6) or by the group insurance board under s. 40.51 (7).

632.749 History History: 1995 a. 289; 1997 a. 27.

632.7495 632.7495 Guaranteed renewability of individual health insurance coverage.

632.7495(1) (1) 

632.7495(1)(a) (a) Except as provided in subs. (2) to (4) and notwithstanding s. 631.36 (2) to (4m), an insurer that provides individual health benefit plan coverage shall renew such coverage or continue such coverage in force at the option of the insured individual and, if applicable, the association through which the individual has coverage.

632.7495(1)(b) (b) At the time of coverage renewal, the insurer may modify the individual health benefit plan coverage policy form as long as the modification is consistent with state law and effective on a uniform basis among all individuals with coverage under that policy form.

632.7495(2) (2) Notwithstanding s. 631.36 (2) to (4m), an insurer may nonrenew or discontinue the individual health benefit plan coverage of an individual, but only if any of the following applies:

632.7495(2)(a) (a) The individual or, if applicable, the association through which the individual has coverage has failed to pay premiums or contributions in accordance with the terms of the health insurance coverage or in a timely manner.

632.7495(2)(b) (b) The individual or, if applicable, the association through which the individual has coverage has performed an act or engaged in a practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the health insurance coverage.

632.7495(2)(c) (c) The insurer is ceasing to offer individual health benefit plan coverage in accordance with sub. (3) and any other applicable state law.

632.7495(2)(d) (d) In the case of individual health benefit plan coverage that the insurer offers through a network plan, the individual no longer resides, lives or works in the service area or in an area in which the insurer is authorized to do business. Coverage may be terminated if this paragraph applies only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.

632.7495(2)(e) (e) In the case of individual health benefit plan coverage that the insurer offers only through one or more bona fide associations, the individual ceases to be a member of the association on which the coverage is based. Coverage may be terminated if this paragraph applies only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.

632.7495(2)(f) (f) The individual is eligible for medicare and the commissioner by rule permits coverage to be terminated.

632.7495(3) (3) 

632.7495(3)(a) (a) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering in this state a particular type of individual health benefit plan coverage, but only if all of the following apply:

632.7495(3)(a)1. 1. The insurer provides notice of the discontinuance to each individual for whom the insurer provides coverage of this type in this state and, if applicable, to the association through which the individual has coverage at least 90 days before the date on which the coverage will be discontinued.

632.7495(3)(a)2. 2. The insurer offers to each individual for whom the insurer provides coverage of this type in this state and, if applicable, to the association through which the individual has coverage the option to purchase any other type of individual health insurance coverage that the insurer offers for individuals.

632.7495(3)(a)3. 3. In electing to discontinue coverage of this particular type and in offering the option to purchase coverage under subd. 2., the insurer acts uniformly without regard to any health status-related factor of enrolled individuals or individuals who may become eligible for the type of coverage described under subd. 2.

632.7495(3)(b) (b) Notwithstanding s. 631.36 (2) to (4m), an insurer may discontinue offering individual health benefit plan coverage in this state, but only if all of the following apply:

632.7495(3)(b)1. 1. The insurer provides notice of the discontinuance to the commissioner and to each individual for whom the insurer provides individual health benefit plan coverage in this state and, if applicable, to the association through which the individual has coverage at least 180 days before the date on which the coverage will be discontinued.

632.7495(3)(b)2. 2. All individual health benefit plan coverage issued or delivered for issuance in this state is discontinued and coverage under such coverage is not renewed.

632.7495(3)(b)3. 3. The insurer does not issue or deliver for issuance in this state any individual health benefit plan coverage before 5 years after the day on which the last individual health benefit plan coverage is discontinued under subd. 2.

632.7495(4) (4) Except as the commissioner may provide by rule under sub. (5) and notwithstanding subs. (1) and (2) and s. 631.36 (4), an insurer is not required to renew individual health benefit plan coverage that complies with all of the following:

632.7495(4)(a) (a) The coverage is marketed and designed to provide short-term coverage as a bridge between coverages.

632.7495(4)(b) (b) The coverage has a term of not more than 12 months.

632.7495(4)(c) (c) The coverage term aggregated with all consecutive periods of the insurer’s coverage of the insured by individual health benefit plan coverage not required to be renewed under this subsection does not exceed 18 months. For purposes of this paragraph, coverage periods are consecutive if there are no more than 63 days between the coverage periods.

632.7495(4)(d) (d) Rules promulgated by the commissioner under sub. (5).

632.7495(5) (5) The commissioner shall promulgate rules governing disclosures related to, and may promulgate rules setting standards for, the sale of individual health benefit plans that an insurer is not required to renew under sub. (4).

632.7495 History History: 1997 a. 27, 237; 2009 a. 28.

632.7497 632.7497 Modifications at renewal.

632.7497(1) (1) In this section, “individual major medical or comprehensive health benefit plan” includes coverage under a group policy that is underwritten on an individual basis and issued to individuals or families.

632.7497(2) (2) An insurer that issues an individual major medical or comprehensive health benefit plan shall, at the time of a coverage renewal, at the request of an insured, permit the insured to do either of the following:

632.7497(2)(a) (a) Change his or her coverage to any of the following:

632.7497(2)(a)1. 1. A different but comparable individual major medical or comprehensive health benefit plan currently offered by the insurer.

632.7497(2)(a)2. 2. An individual major medical or comprehensive health benefit plan currently offered by the insurer with more limited benefits.

632.7497(2)(a)3. 3. An individual major medical or comprehensive health benefit plan currently offered by the insurer with higher deductibles.

632.7497(2)(b) (b) Modify his or her existing coverage by electing an optional higher deductible, if any, under the individual major medical or comprehensive health benefit plan.

632.7497(3) (3) 

632.7497(3)(a) (a) The insurer may not impose any new preexisting condition exclusion under the new or modified coverage under sub. (2) that did not apply to the insured’s original coverage and shall allow the insured credit under the new or modified coverage for the period of original coverage.

632.7497(3)(b) (b) For the new or modified coverage, the insurer may not rate for health status other than on the insured’s health status at the time the insured applied for the original coverage and as the insured disclosed on the original application.

632.7497(4) (4) 

632.7497(4)(a) (a) Annually, the insurer shall mail to each insured under an individual major medical or comprehensive health benefit plan issued by the insurer, a notice that includes all of the following information:

632.7497(4)(a)1. 1. That the insured has the right to elect alternative coverage as described in sub. (2).

632.7497(4)(a)2. 2. A description of the alternatives available to the insured.

632.7497(4)(a)3. 3. The procedure for making the election.

632.7497(4)(b) (b) The insurer shall mail the notice under par. (a) not more than 3 months nor less than 60 days before the renewal date of the insured’s plan.

632.7497(5) (5) 

632.7497(5)(a) (a) Nothing in this section requires an insurer to issue alternative coverage under sub. (2) if the insured’s coverage may be nonrenewed or discontinued under s. 632.7495 (2), (3) (b), or (4).

632.7497(5)(b) (b) Notwithstanding s. 600.01 (1) (b) 3. and 4., this section applies to a group health benefit plan described in s. 600.01 (1) (b) 3. or 4. if that group health benefit plan is an individual major medical or comprehensive health benefit plan as defined in sub. (1).

632.7497 History History: 2009 a. 28.

632.75 632.75 Prohibited provisions for disability insurance.

632.75(1) (1) Death presumed from extended absence. Section 813.22 (1) applies to any disability insurance policy providing a death benefit.

632.75(2) (2) Dividends conditioned on continuation of policy or payment of premiums. Except on the first or second anniversary, no dividend payable on a disability insurance policy may be made contingent on the continuation of the policy or on premium payments.

632.75(3) (3) Prohibition of exclusion from coverage of certain dependent children. No disability insurance policy issued or renewed on or after April 30, 1980, may exclude or terminate from coverage any dependent child of an insured person or group member solely because the child does not reside with the insured person or group member. This subsection does not apply to a group policy, as defined in s. 632.897 (1) (c), or an individual policy, as defined in s. 632.897 (1) (cm), that is subject to s. 632.897 (10).

632.75(4) (4) Out-of-state service providers. Except as provided in s. 628.36, no disability insurance policy may exclude or limit coverage of health care services provided outside this state, if the services are provided within 75 miles of the insured’s residence in a facility licensed or approved by the state where the facility is located.

632.75(5) (5) Payments for hospital services. No insurer may reimburse a hospital for patient health care costs at a rate exceeding the rate established under ch. 54, 1985 stats., or s. 146.60, 1983 stats., for care provided prior to July 1, 1987.

632.75 History History: 1975 c. 375; 1979 c. 221; 1981 c. 304; 1983 a. 27; 1985 a. 29 s. 3202 (27); 1987 a. 27; 1989 a. 31, 359.

632.755 632.755 Public assistance and early intervention services.

632.755(1g) (1g) 

632.755(1g)(a) (a) A disability insurance policy may not exclude a person or a person’s dependent from coverage because the person or the dependent is eligible for assistance under ch. 49 or because the dependent is eligible for early intervention services under s. 51.44.

632.755(1g)(b) (b) A disability insurance policy may not terminate its coverage of a person or a person’s dependent because the person or the dependent is eligible for assistance under ch. 49 or because the dependent is eligible for early intervention services under s. 51.44.

632.755(1g)(c) (c) A disability insurance policy may not provide different benefits of coverage to a person or the person’s dependent because the person or the dependent is eligible for assistance under ch. 49 or because the dependent is eligible for early intervention services under s. 51.44 than it provides to persons and their dependents who are not eligible for assistance under ch. 49 or for early intervention services under s. 51.44.

632.755(2) (2) Benefits provided by a disability insurance policy shall be primary to those benefits provided under ch. 49 or under s. 51.44 or 253.05.

632.755 History History: 1985 a. 29; 1989 a. 173; 1991 a. 178, 214; 1995 a. 407; 1997 a. 27.

632.76 632.76 Incontestability for disability insurance.

632.76(1) (1) Avoidance for misrepresentations. No statement made by an applicant in the application for individual disability insurance coverage and no statement made respecting the person’s insurability by a person insured under a group policy, except fraudulent misrepresentation, is a basis for avoidance of the policy or denial of a claim for loss incurred or disability commencing after the coverage has been in effect for 2 years. The policy may provide for incontestability even with respect to fraudulent misstatements.

632.76(2) (2) Preexisting diseases.

632.76(2)(a) (a) No claim for loss incurred or disability commencing after 2 years from the date of issue of the policy may be reduced or denied on the ground that a disease or physical condition existed prior to the effective date of coverage, unless the condition was excluded from coverage by name or specific description by a provision effective on the date of loss. This paragraph does not apply to a group health benefit plan, as defined in s. 632.745 (9), which is subject to s. 632.746.

632.76(2)(ac) (ac)

632.76(2)(ac)1. 1. Notwithstanding par. (a), no claim or loss incurred or disability commencing after 12 months from the date of issue of an individual disability insurance policy, as defined in s. 632.895 (1) (a), may be reduced or denied on the ground that a disease or physical condition existed prior to the effective date of coverage, unless the condition was excluded from coverage by name or specific description by a provision effective on the date of the loss.

632.76(2)(ac)2. 2. Except as provided in subd. 3., an individual disability insurance policy, as defined in s. 632.895 (1) (a), other than a short-term policy subject to s. 632.7495 (4) and (5), may not define a preexisting condition more restrictively than a condition, whether physical or mental, regardless of the cause of the condition, for which medical advice, diagnosis, care, or treatment was recommended or received within 12 months before the effective date of coverage.

632.76(2)(ac)3. 3. Except as the commissioner provides by rule under s. 632.7495 (5), all of the following apply to an individual disability insurance policy that is a short-term policy subject to s. 632.7495 (4) and (5):

632.76(2)(ac)3.a. a. The policy may not define a preexisting condition more restrictively than a condition, whether physical or mental, regardless of the cause of the condition, for which medical advice, diagnosis, care, or treatment was recommended or received before the effective date of coverage.

632.76(2)(ac)3.b. b. The policy shall reduce the length of time during which a preexisting condition exclusion may be imposed by the aggregate of the insured’s consecutive periods of coverage under the insurer’s individual disability insurance policies that are short-term policies subject to s. 632.7495 (4) and (5). For purposes of this subd. 3. b., coverage periods are consecutive if there are no more than 63 days between the coverage periods.

632.76(2)(b) (b) Notwithstanding par. (a), no claim for loss incurred or disability commencing after 6 months from the date of issue of a medicare supplement policy, medicare replacement policy or long-term care insurance policy may be reduced or denied on the ground that a disease or physical condition existed prior to the effective date of coverage. Notwithstanding par. (ac) 2., a medicare supplement policy, medicare replacement policy, or long-term care insurance policy may not define a preexisting condition more restrictively than a condition for which medical advice was given or treatment was recommended by or received from a physician within 6 months before the effective date of coverage. Notwithstanding par. (a), if on the basis of information contained in an application for insurance a medicare supplement policy, medicare replacement policy, or long-term care insurance policy excludes from coverage a condition by name or specific description, the exclusion must terminate no later than 6 months after the date of issue of the medicare supplement policy, medicare replacement policy, or long-term care insurance policy. The commissioner may by rule exempt from this paragraph certain classes of medicare supplement policies, medicare replacement policies, and long-term care insurance policies, if the commissioner finds the exemption is not adverse to the interests of policyholders and certificate holders.

632.76 History History: 1975 c. 375, 421; 1981 c. 82; 1985 a. 29; 1989 a. 31; 1995 a. 289; 1997 a. 27; 2009 a. 28.

632.76 Cross-reference Cross-reference: See also s. Ins 3.39, Wis. adm. code.

632.76 Annotation A generic exclusion of all diseases or conditions diagnosed or treated before issuance of the policy does not constitute exclusion by “name or specific description” under sub. (2). Peterson v. Equitable Life Assurance Society of the United States, 57 F. Supp. 2d 692 (1999).

632.77 632.77 Permitted provisions for disability insurance policies. If any provisions are contained in a disability insurance policy dealing with the following subjects, they shall conform to the requirements specified:

632.77(1) (1) Change of occupation. Any provision respecting change of occupation may provide only for a lower maximum payment and for reduction of loss payments proportionate to the change in appropriate premium rates if the change is to a higher rated occupation, and must provide for retroactive reduction of premium rates from the date of change of occupation or the last policy anniversary date, whichever is the more recent, if the change is to a lower rated occupation.

632.77(2) (2) Misstatement of age. Any provision respecting misstatement of age may only provide for reduction of the loss payable to the amount that the premium paid would have purchased at the correct age.

632.77(3) (3) Limitations on payments. Any limitation on payments because of other insurance or because of the income of the insured must be in accordance with provisions approved by the commissioner by rule or explicitly approved in approving the policy form, but the commissioner may not promulgate a rule that conflicts with s. 632.755 nor approve a policy form that does not comply with s. 632.755.

632.77(4) (4) Facility of payment. Reasonable facility of payment clauses may be inserted. Payment in accordance with such clauses shall discharge the insurer’s obligation to pay claims.

632.77 History History: 1975 c. 375; 1979 c. 102; 1985 a. 29.

632.775 632.775 Effect of power of attorney for health care.

632.775(1) (1) Insurer may not require. An insurer may not require an individual to execute a power of attorney for health care under ch. 155 as a condition of coverage under a disability insurance policy.