The Texas Department of Insurance proposes amendments to §21.2107 concerning the rights of eligible beneficiaries to notice under §3.3312. The amendments are necessary to implement changes made to the Social Security Act (Act) by Medicare, Medicaid, and State Children´s Health Insurance Program Benefits Improvement and Protection Act of 2000 (BIPA) and subsequent changes made to the National Association of Insurance Commissioners (NAIC) Model Regulation to Implement the NAIC Medicare Supplement Insurance Minimum Standards Model Act. The Model Regulation was accepted by the Centers for Medicare and Medicaid Services (CMS), the agency which administers Medicare programs. The proposed amendments to §21.2107 require entities described in §3.3312 to disclose to individuals their right to extended Medicare supplement access if their enrollment is interrupted within their trial period due to involuntary termination. As the accepted changes to the NAIC Model Regulation affected guaranteed issue time periods, proposed amendments §3.3312 are published elsewhere in this issue of the Texas Register.
Ana Smith-Daley, deputy commissioner, Life/Health Division, has determined that for each year of the first five years the proposal will be in effect, there will be no fiscal impact to state and local governments as a result of the enforcement or administration of the rule. There will be no measurable effect on local employment or the local economy as a result of the proposal.
Ms. Smith-Daley has also determined that for each year of the first five years the section is in effect, the public benefits anticipated as a result of the proposal will be an increase in the understanding of requirements and benefits of extended Medicare supplement access for interrupted trial periods. Any costs to persons required to comply with the proposed amendments is the result of federal enactment of BIPA, and not as the result of the enforcement or administration of the proposed amendments. It is the department´s position that the proposed amendments will not have an adverse economic effect on small businesses or micro-businesses. Regardless of the fiscal effect, it is neither legal nor feasible to waive or modify the requirements of the amendments for small and micro- businesses, as doing so would result in a disparate effect on persons affected by this proposed section.
To be considered, written comments on the proposal must be submitted no later than 5:00 P.M. on February 25, 2002 to Lynda H. Nesenholtz, General Counsel and Chief Clerk, Mail Code 113-2A, Texas Department of Insurance, P. O. Box 149104, Austin, Texas 78714-9104. An additional copy of the comment must be simultaneously submitted to Diane Moellenberg, Chief Director, Regulatory Development, Mail Code 107-2A, P. O. Box 149104, Austin, Texas 78714-9104. A request for public hearing on the proposal should be submitted separately to the Office of the Chief Clerk.
The amendment is proposed under Insurance Code Article 3.74, 20A.22 and §36.001. Article 3.74, §10 provides that the department shall adopt rules in accordance with the federal law applicable to the regulation of Medicare supplement insurance coverage that are necessary for the state to obtain or retain certification as a state with an approved regulatory program under §1882 Social Security Act (42 U.S.C. §1395ss). Article 20A.22(c) authorizes the commissioner to promulgate rules as are necessary and proper to meet the requirements of federal law and regulations. Section 36.001 authorizes the Commissioner to adopt rules for the conduct and execution of the powers of the department as authorized by statute.
The following articles are affected by this proposal: Insurance Code Articles 3.74 and 20A.22
§21.2107. Right To Medicare Supplement Coverage Notice.
(a) At the time of an event described in §3.3312(b) of this title (relating to Guaranteed Issue for Eligible Persons) because of which an individual loses coverage or benefits due to the termination of a contract, agreement, policy, or plan, the entity, as defined in and pursuant to §3.3312 of this title, shall notify the individual of his or her rights under §3.3312(a), (c), [
and] (d)
, and (e) of this title, and of the obligations of issuers of Medicare supplement policies under §3.3312(a) of this title. The entity shall communicate such notice contemporaneously with the notification of termination.
(b) At the time of an event described in §3.3312(b) of this title because of which an individual ceases enrollment under a contract, agreement, policy, or plan, the entity, as defined in §3.3312 of this title, which offers the contract or agreement, regardless of the basis for the cessation of enrollment, the entity offering the plan, or the licensed third party administrator of the plan, respectively, shall notify the individual of his or her rights under §3.3312(a), (c), [
and] (d)
, and (e) of this title, and of the obligations of issuers of Medicare supplement policies under §3.3312(a) of this title. The entity shall communicate such notice within ten working days of the entity's receipt of notification of disenrollment.