Chapter Ins 3

Ins 3.39(8)(a)3. 3. May contain a pre-existing condition waiting period provision as provided in sub. (4) (a) 2., which shall appear as a separate paragraph on the first page of the policy and shall be captioned or titled “Pre-existing Condition Limitations;” and

Ins 3.39(8)(a)4. 4. May, if issued by a health maintenance organization as defined by s. 609.01 (2), Stats., include territorial limitations which are generally applicable to all coverage issued by the plan.

Ins 3.39(8)(a)5. 5. May exclude coverage for the treatment of service related conditions for members or ex-members of the armed forces by any military or veterans hospital or soldier home or any hospital contracted for or operated by any national government or agency.

Ins 3.39(8)(b) (b) If the insured chooses not to enroll in Medicare Part B, the issuer may exclude from coverage the expenses which Medicare Part B would have covered if the insured were enrolled in Medicare Part B. An issuer may not exclude Medicare Part B eligible expenses incurred beyond what Medicare Part B would cover.

Ins 3.39(8)(c) (c) The coverages set out in subs. (5), (5m), (5t), (7), (30), (30m), and (30t) may not exclude, limit, or reduce coverage for specifically named or described preexisting diseases or physical conditions, except as provided in par. (a) 3.

Ins 3.39(8)(e) (e) A Medicare cost policy, Medicare supplement policy or certificate and Medicare select policy or certificate may include other exclusions and limitations that are not otherwise prohibited and are not more restrictive than exclusions and limitations contained in Medicare.

Ins 3.39(9) (9) Individual policies providing nursing home, hospital confinement indemnity, specified disease and other coverages.

Ins 3.39(9)(a) (a) Caption requirements. Captions required by this subsection shall be:

Ins 3.39(9)(a)1. 1. Printed and conspicuously placed on the first page of the Outline of Coverage,

Ins 3.39(9)(a)2. 2. Printed on a separate form attached to the first page of the policy, and

Ins 3.39(9)(a)3. 3. Printed in 18-point bold letters.

Ins 3.39(9)(b) (b) Disclosure statements. The appropriate disclosure statement from Appendix 10 shall be used on the application or together with the application for each coverage in pars. (c) to (e). The disclosure statement may not vary from the text or format including bold characters, line spacing, and the use of boxes around text contained in Appendix 10 and shall use a type size of at least 12 points. The issuer may use either (a) or (aL), (b) or (bL), (c) or (cL) or (g) or (gL) providing the issuer uses the same disclosure statement for all policies of the type covered by the disclosure.

Ins 3.39(9)(c) (c) Hospital confinement indemnity coverage. An individual policy form providing hospital confinement indemnity coverage sold to a Medicare eligible person:

Ins 3.39(9)(c)1. 1. Shall not include benefits for nursing home confinement unless the nursing home coverage meets the standards set forth in s. Ins 3.46;

Ins 3.39(9)(c)2. 2. Shall bear the caption, if the policy provides no other types of coverage: “This policy is not designed to fill the gaps in Medicare. It will pay you only a fixed dollar amount per day when you are confined to a hospital. For more information, see “Wisconsin Guide to Health Insurance for People with Medicare’, given to you when you applied for this policy.”

Ins 3.39(9)(c)3. 3. Shall bear the caption set forth in par. (e), if the policy provides other types of coverage in addition to the hospital confinement indemnity coverage.

Ins 3.39(9)(d) (d) Specified disease coverage. An individual policy form providing benefits only for one or more specified diseases sold to a Medicare eligible person shall bear:

Ins 3.39(9)(d)1. 1. The designation: SPECIFIED OR RARE DISEASE LIMITED POLICY, and

Ins 3.39(9)(d)2. 2. The caption: “This policy covers only one or more specified or rare illnesses. It is not a substitute for a broader policy which would generally cover any illness or injury. For more information, see ‘Wisconsin Guide to Health Insurance for People with Medicare’, given to you when you applied for this policy.”

Ins 3.39(9)(e) (e) Other coverage. An individual disability policy sold to a Medicare eligible person, other than a form subject to sub. (5) or (7) or otherwise subject to the caption requirements in this subsection or exempted by sub. (2) (d) or (e), shall bear the caption: “This policy is not a Medicare supplement. For more information, see “Wisconsin Guide to Health Insurance for People with Medicare’, given to you when you applied for this policy.”

Ins 3.39(10) (10) Conversion or continuation of coverage.

Ins 3.39(10)(a) (a) Conversion requirements. An insured under individual, family, or group hospital or medical coverage who will become eligible for Medicare and is offered a conversion policy which is not subject to subs. (4), (4m), (4t), (5), (5m), (5t) or (7) shall be furnished by the issuer, at the time the conversion application is furnished in the case of individual or family coverage or within 14 days of a request in the case of group coverage.

Ins 3.39(10)(a)1. 1. An outline of coverage as described in par. (d) and

Ins 3.39(10)(a)2. 2. A copy of the current edition of the pamphlet described in sub. (11).

Ins 3.39(10)(b) (b) Continuation requirements. An insured under individual, family, or group hospital or medical coverage who will become eligible for Medicare and whose coverage will continue with changed benefits (e.g., “carve-out” or reduced benefits) shall be furnished by the issuer, within 14 days of a request:

Ins 3.39(10)(b)1. 1. A comprehensive written explanation of the coverage to be provided after Medicare eligibility, and

Ins 3.39(10)(b)2. 2. A copy of the current edition of the pamphlet described in sub. (11).

Ins 3.39(10)(c) (c) Notice to group policyholder. An issuer which provides group hospital or medical coverage shall furnish to each group policyholder:

Ins 3.39(10)(c)1. 1. Annual written notice of the availability of the materials described in pars. (a) and (b), where applicable, and

Ins 3.39(10)(c)2. 2. Within 14 days of a request, sufficient copies of the same or a similar notice to be distributed to the group members affected.

Ins 3.39(10)(d) (d) Outline of coverage. The outline of coverage:

Ins 3.39(10)(d)1. 1. For a conversion policy which relates its benefits to or complements Medicare, shall comply with sub. (4) (b) 2., 5., and 7., (4m) (b) 2., 5., 7., or (4t) (b) 2., 5., and 7. and shall be submitted to the commissioner; and

Ins 3.39(10)(d)2. 2. For a conversion policy not subject to subd. 1., shall comply with sub. (9), where applicable, and s. Ins 3.27 (5) (L).

Ins 3.39(11) (11) “Wisconsin Guide to Health Insurance for People with Medicare” pamphlet. Every prospective Medicare eligible purchaser of any policy or certificate subject to this section which provides hospital or medical coverage, other than incidentally, or of any coverage added to an existing Medicare supplement policy or certificate, except any policy subject to s. Ins 3.46, shall receive a copy of the current edition of the commissioner’s pamphlet “Wisconsin Guide to Health Insurance for People with Medicare” in a type size no smaller than 12 point type at the time the prospect is contacted by an intermediary or issuer with an invitation to apply as defined in s. Ins 3.27 (5) (g). Except in the case of direct response insurance, written acknowledgement of receipt of this pamphlet shall be obtained by the issuer. This pamphlet provides information on Medicare and advice to people on Medicare on the purchase of Medicare supplement insurance and other health insurance. Issuers may obtain information from the commissioner’s office on how to obtain copies or may reproduce this pamphlet themselves. This pamphlet may be periodically revised to reflect changes in Medicare and any other appropriate changes. No issuer shall be responsible for providing applicants the revised pamphlet until 30 days after the issuer has been given notice that the revised pamphlet is available.

Ins 3.39(12) (12) Approval not a recommendation. While the commissioner may authorize the use of a particular designation on a policy or certificate in accordance with this section, that authorization is not to be construed or advertised as a recommendation of any particular policy or certificate by the commissioner or the state of Wisconsin.

Ins 3.39(13) (13) Exemption of certain policies and certificates from certain statutory Medicare supplement requirements. Policies and certificates described in sub. (2) (d), even if they are Medicare supplement and Medicare select policies as described in s. 600.03 (28r), Stats., or Medicare cost policies as described in s. 600.03 (28p) (a) and (c), Stats., shall not be subject to either of the following:

Ins 3.39(13)(a) (a) The special right of return provision for Medicare supplement, Medicare select, or Medicare cost policies set forth in s. 632.73 (2m), Stats., and s. Ins 3.13 (2) (j) 3.

Ins 3.39(13)(b) (b) The special preexisting disease provisions for Medicare supplement, Medicare select, or Medicare cost policies set forth in s. 632.76 (2) (b), Stats.

Ins 3.39(14) (14) Other requirements for policies or certificates with effective dates prior to June 1, 2010.

Ins 3.39(14)(a) (a) Each issuer issuing policies or certificates to persons first eligible for Medicare prior to June 1, 2010, may file and utilize only one individual Medicare supplement policy form, one individual Medicare select policy form, one individual Medicare cost policy form, one group Medicare select certificate form and one group Medicare supplement certificate form with any of the accompanying riders permitted in sub. (5) (i), unless the commissioner approves the use of additional forms and the issuer agrees to aggregate experience for the various forms in calculating rates and loss ratios.

Ins 3.39(14)(b) (b) An issuer shall mail any refund or return of premium directly to the insured and may not require or permit delivery by an agent or other representative.

Ins 3.39(14)(c) (c) An issuer shall comply with section 1882 (c) (3) of the social security act, as enacted by section 4081 (b) (2) (C) of the Omnibus Budget Reconciliation Act of 1987 (OBRA) 1987, Pub. L. No. 100-203, by complying with all of the following:

Ins 3.39(14)(c)1. 1. Accepting a notice from a Medicare issuer on dually assigned claims submitted by participating physicians and suppliers as a claim for benefits in place of any other claim form otherwise required and making a payment determination on the basis of the information contained in that notice.

Ins 3.39(14)(c)2. 2. Notifying the participating physician or supplier and the beneficiary of the payment determination.

Ins 3.39(14)(c)3. 3. Paying the participating physician or supplier directly.

Ins 3.39(14)(c)4. 4. Furnishing, at the time of enrollment, each insured with a card listing the policy name, number and a central mailing address to which notices from a Medicare issuer may be sent.

Ins 3.39(14)(c)5. 5. Paying user fees for claim notices that are transmitted electronically or otherwise.

Ins 3.39(14)(c)6. 6. Providing to the secretary, at least annually, a central mailing address to which all claims may be sent by Medicare issuers.

Ins 3.39(14)(c)7. 7. Certifying compliance with the requirements set forth in this subsection on the Medicare supplement insurance experience reporting form.

Ins 3.39(14)(d) (d) Except as provided in subd. 1., an issuer shall continue to make available for purchase any Medicare supplement policy or certificate, Medicare select policy or certificate, or Medicare cost policy form or certificate form issued after August 1, 1992, that has been approved by the commissioner. A policy form or certificate form shall not be considered to be available for purchase unless the issuer has actively offered it for sale in the previous 12 months.

Ins 3.39(14)(d)1. 1. An issuer may discontinue the availability of a Medicare supplement policy or certificate, Medicare select policy or certificate, or Medicare cost policy form or certificate form if the issuer provides to the commissioner in writing its decision at least 30 days prior to discontinuing the availability of the form of the policy or certificate. After receipt of the notice by the commissioner, the issuer shall no longer offer for sale the discontinued policy form or certificate for in this state.

Ins 3.39(14)(d)2. 2. An issuer that discontinues the availability of a Medicare supplement policy or certificate, Medicare select policy or certificate, or Medicare cost policy form or certificate form pursuant to subd. 1., shall not file for approval a new policy form or certificate form for a period of 5 years after the issuer provides notice to the commissioner of the discontinuance. The period of discontinuance may be reduced if the commissioner determines that a shorter period is appropriate.

Ins 3.39(14)(d)3. 3. This subsection shall not apply to the riders permitted in sub. (5) (i).

Ins 3.39(14)(e) (e) The sale or other transfer of Medicare supplement business to another issuer shall be considered a discontinuance for the purposes of this subsection.

Ins 3.39(14)(f) (f) A change in the rating structure or methodology shall be considered a discontinuance under par. (d) 1. unless the issuer complies with the following requirements:

Ins 3.39(14)(f)1. 1. The issuer provides an actuarial memorandum, in a form and manner prescribed by the commissioner, describing the manner in which the revised rating methodology and resultant rates differ from the existing rating methodology and resultant rates.

Ins 3.39(14)(f)2. 2. The issuer does not subsequently put into effect a change of rates or rating factors that would cause the percentage differential between the discontinued and subsequent rates as described in the actuarial memorandum to change. The commissioner may approve a change to the differential which is in the public interest.

Ins 3.39(14)(g) (g) Except as provided in par. (h) the experience of all policy forms or certificate forms of the same type in a standard Medicare supplement benefit plan shall be combined for purposes of the refund or credit calculation prescribed in sub. (31).

Ins 3.39(14)(h) (h) Forms assumed under an assumption reinsurance agreement shall not be combined with the experience of other forms for purposes of the refund or credit calculation.

Ins 3.39(14)(i) (i) No issuer may issue a Medicare supplement policy or certificate, Medicare select policy or certificate, or Medicare cost policy to an applicant 75 years of age or older, unless the applicant is subject to sub. (3r) or, prior to issuing coverage, the issuer either agrees not to rescind or void the policy or certificate except for intentional fraud in the application, or obtains one of the following:

Ins 3.39(14)(i)1. 1. A copy of a physical examination.

Ins 3.39(14)(i)2. 2. An assessment of functional capacity.

Ins 3.39(14)(i)3. 3. An attending physician’s statement.

Ins 3.39(14)(i)4. 4. Copies of medical records.

Ins 3.39(14)(j) (j) Notwithstanding par. (a), an issuer may file and use only one individual Medicare select policy form and one group Medicare select policy form. These policy forms shall not be aggregated with non-Medicare select forms in calculating premium rates, loss ratios and premium refunds.

Ins 3.39(14)(k) (k) If an issuer nonrenews an insured who has a nonguaranteed renewable Medicare supplement policy with the issuer, the issuer shall at the time any notice of nonrenewal is sent to the insured, offer a currently available individual replacement Medicare supplement policy and those currently available riders resulting in coverage substantially similar to coverage provided by the replaced policy without underwriting. This replacement shall comply with sub. (27).

Ins 3.39(14)(L) (L) For policies issued to persons first eligible for Medicare between December 31, 1980, and January 1, 1992, issuers shall combine the Wisconsin experience of all policy forms of the same type, as defined at sub. (3) (zar), for the purpose of calculating the loss ratio under sub. (16) (c) and rates. The rates for all such policies or certificates of the same type shall be adjusted by the same percentage. Issuers may combine the Wisconsin experience of all policies issued prior to January 1, 1981, with those issued between December 31, 1980, and January 1, 1992, if the issuer uses the 60% loss ratio for individual policies and the 70% loss ratio for group policies renewed prior to January 1, 1996, and the appropriate loss ratios specified in sub. (16) (d) thereafter. For policies issued on or after January 1, 1992, and prior to June 1, 2010, issuers shall combine the Wisconsin experience of all policy or certificate forms of the same type, for the purpose of calculating the amount of refund or premium credit, if any, if the issuer uses the 65% loss ratio for individual policies and the 75% loss ratio for group certificates renewed on or after January 1, 1996, and prior to June 1, 2010, and the appropriate loss ratios specified in sub. (16) (d). If the Wisconsin experience is not credible, then national experience can be considered.

Ins 3.39(14)(m) (m) If Medicare determines the eligibility of a covered service, then the issuer shall use Medicare’s determination in processing claims.

Ins 3.39(14m) (14m) Other requirements for policies or certificates issued to persons first eligible for Medicare on or after June 1, 2010, and prior to January 1, 2020.

Ins 3.39(14m)(a) (a) Each issuer issuing policies or certificates to persons first eligible for Medicare on or after June 1, 2010, and prior to January 1, 2020, may file and utilize only one individual Medicare supplement policy form, one individual Medicare select policy form, one individual Medicare cost policy form, one group Medicare select certificate form, and one group Medicare supplement certificate form with any of the accompanying riders permitted in sub. (5m) (e), unless the commissioner approves the use of additional forms and the issuer agrees to aggregate experience for the various forms in calculating rates and loss ratios.

Ins 3.39(14m)(b) (b) An issuer shall mail any refund or return of premium directly to the insured and may not require or permit delivery by an agent or other representative.

Ins 3.39(14m)(c) (c) An issuer shall comply with section 1882 (c) (3) of the Social Security Act, as enacted by section 4081 (b) (2) (C) of the Omnibus Budget Reconciliation Act of 1987 (OBRA) 1987, Pub. L. No. 100-203, by complying with all of the following:

Ins 3.39(14m)(c)1. 1. Accepting a notice from a Medicare issuer on dually assigned claims submitted by participating physicians and suppliers as a claim for benefits in place of any other claim form otherwise required and making a payment determination on the basis of the information contained in that notice.

Ins 3.39(14m)(c)2. 2. Notifying the participating physician or supplier and the beneficiary of the payment determination.

Ins 3.39(14m)(c)3. 3. Paying the participating physician or supplier directly.

Ins 3.39(14m)(c)4. 4. Furnishing, at the time of enrollment, each insured with a card listing the policy or certificate name, number and a central mailing address to which notices from a Medicare issuer may be sent.

Ins 3.39(14m)(c)5. 5. Paying user fees for claim notices that are transmitted electronically or otherwise.

Ins 3.39(14m)(c)6. 6. Providing to the secretary, at least annually, a central mailing address to which all claims may be sent by Medicare issuers.

Ins 3.39(14m)(c)7. 7. Certifying compliance with the requirements set forth in this subsection on the Medicare supplement insurance experience reporting form.

Ins 3.39(14m)(d) (d)

Ins 3.39(14m)(d)1. 1. Except as provided in subd. 2., an issuer shall continue to make available for purchase any policy or certificate form issued to persons first eligible for Medicare after May 31, 2010, and prior to January 1, 2020, that has been approved by the commissioner. A policy or certificate form shall not be considered to be available for purchase unless the issuer has actively offered it for sale in the previous 12 months.

Ins 3.39(14m)(d)2. 2. An issuer may discontinue the availability of a policy form or certificate form if the issuer provides to the commissioner in writing its decision at least 30 days prior to discontinuing the availability of the form of the policy or certificate. After receipt of the notice by the commissioner, the issuer shall no longer offer for sale the policy form or certificate form in this state.

Ins 3.39(14m)(d)3. 3. An issuer that discontinues the availability of a policy or certificate form pursuant to subd. 2., shall not file for approval a new policy form or certificate form of the same type, as defined at sub. (3) (zar), as the discontinued form for a period of 5 years after the issuer provides notice to the commissioner of the discontinuance. The period of discontinuance may be reduced if the commissioner determines that a shorter period is appropriate.

Ins 3.39(14m)(d)4. 4. This subsection shall not apply to the riders permitted in sub. (5m) (e).

Ins 3.39(14m)(e) (e) The sale or other transfer of Medicare supplement business to another issuer shall be considered a discontinuance for the purposes of this subsection.

Ins 3.39(14m)(f) (f) A change in the rating structure or methodology shall be considered a discontinuance under par. (d) 1. unless the issuer complies with the following requirements:

Ins 3.39(14m)(f)1. 1. The issuer provides an actuarial memorandum, in a form and manner prescribed by the commissioner, describing the manner in which the revised rating methodology and resultant rates differ from the existing rating methodology and resultant rates.

Ins 3.39(14m)(f)2. 2. The issuer does not subsequently put into effect a change of rates or rating factors that would cause the percentage differential between the discontinued and subsequent rates as described in the actuarial memorandum to change. The commissioner may approve a change to the differential that is in the public interest.

Ins 3.39(14m)(g) (g) Except as provided in par. (h) the experience of all policy forms or certificate forms of the same type in a standard Medicare supplement benefit plan shall be combined for purposes of the refund or credit calculation prescribed in sub. (31).