CHAPTER 36. INDIVIDUAL HEALTH INSURANCE MINIMUM STANDARDS
§ 3601. Purpose and scope.
(a) The purpose of this chapter shall be to provide reasonable standardization and simplification of terms and coverages of
individual health insurance policies and subscriber contracts of health service corporations to facilitate public understanding
and comparison, to eliminate provisions contained in individual health insurance policies and subscriber contracts of health
service corporations which may be misleading or unreasonably confusing in connection either with the purchase of such coverages
or with the settlement of claims, and to provide for full disclosure in the sale of health insurance coverages. Additionally,
the purpose of this chapter is to promote the availability of health insurance coverage to recently uninsured individuals,
regardless of their health status or claims experience, and to improve the overall fairness and efficiency of the individual
health insurance market.
(b) This chapter notwithstanding, Medicare supplement coverage shall be governed by Chapter 34, Medicare Supplement Insurance
Minimum Standards, of this title.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 1.;
§ 3602. Definitions.
As used in this chapter:
(1) "Affiliation period" means a period of time not to exceed 2 months (3 months for late enrollees) during which a health
maintenance organization does not collect premiums and coverage issued is not effective.
(2) "Bona fide association" means, with respect to health insurance coverage offered in Delaware, an association which:
a. Has been actively in existence for at least 5 years;
b. Has been formed and maintained in good faith for purposes other than obtaining insurance and does not condition membership
on the purchase of association-sponsored insurance;
c. Does not condition membership in the association on any health status-related factor relating to an individual (including
an employee of an employer or a dependent of an employee) and clearly so states in all membership and application materials;
d. Makes health insurance coverage offered through the association available to all members regardless of any health status-related
factor relating to such members (or individuals eligible for coverage through a member) and clearly so states in all marketing
and application materials;
e. Does not make health insurance coverage offered through the association available other than in connection with a member
of the association and clearly so states in all marketing and application materials; and
f. Provides and annually updates information necessary for the Commissioner to determine whether or not an association meets
the definition of a bona fide association before qualifying as a bona fide association for the purposes of this chapter.
(3) "Carrier" means an entity subject to the insurance laws and regulations of this State, or subject to the jurisdiction
of the Commissioner, that contracts or offers to contract to provide, deliver, arrange for, pay for or reimburse any of the
costs of health care services, including a sickness and accident insurance company, a health maintenance organization, a nonprofit
hospital and health service corporation or any other entity providing a plan of health insurance, health benefits or health
services. "Carrier" also includes any third-party administrator or other entity that adjusts, administers, or settles claims
in connection with health benefit plans.
(4) "Church plan" has the meaning given such term under § 3(33) of the Employee Retirement Income Security Act of 1974 [29
U.S.C. § 1002(33)].
(5) "Creditable coverage" means, with respect to an individual, health benefits or coverage provided under any of the following:
a. A group health benefit plan;
b. An individual health benefit plan or individual insurance coverage;
c. Part A or Part B of Title XVIII of the Social Security Act [42 U.S.C. § 1395 et seq. or 42 U.S.C. § 1395j et seq.];
d. Title XIX of the Social Security Act [42 U.S.C. § 1396 et seq.], other than coverage consisting solely of benefits under
§ 1928 [42 U.S.C. § 1396s];
e. Chapter 55 of Title 10, United States Code [10 U.S.C. § 1071 et seq.];
f. A medical care program of the Indian Health Service or of a tribal organization;
g. A state health benefits risk pool;
h. A health plan offered under Chapter 89 of Title 5, United States Code [5 U.S.C. § 8901 et seq.];
i. A public health plan as defined in federal regulations;
j. A health benefit plan under § 5(e) of the Peace Corps Act [22 U.S.C. § 2504(e)]. Such term does not include coverage consisting
solely of coverage of excepted benefits as defined in subparagraph (10)b. of this section.
(6) "Dependent" means a spouse, an unmarried child under the age of 18 years, an unmarried child who is a full-time student
under the age of 25 years and who is financially dependent upon the enrollee and an unmarried child of any age who is medically
certified as totally disabled and dependent upon the enrollee.
(7) "Federally eligible individual" means an individual:
a. For whom, as of the date on which the individual seeks coverage under this chapter, the aggregate of the periods of creditable
coverage, as defined in this section, is 18 or more months;
b. Whose most recent prior creditable coverage was under a group health plan, governmental plan, church plan or health insurance
coverage offered in connection with any such plan;
c. Who is not eligible for coverage under a group health plan, Part A or Part B of Title XVIII of the Social Security Act
or a state plan under Title XIX of such act or any successor program, and who does not have other health insurance coverage;
d. With respect to whom the most recent coverage within the period of aggregate creditable coverage was not terminated based
on a factor relating to nonpayment of premiums or fraud;
e. Who, if offered the option of continuation coverage under a COBRA continuation provision or under a similar state program,
elected such coverage; and
f. Who has exhausted such continuation coverage under such provision or program, if the individual elected the continuation
coverage described in subparagraph e. of this paragraph.
(8) "Form" means policies, contracts, riders, endorsements and applications required to be filed with the Commissioner pursuant
to §§ 2712 and 6306 of this title.
(9) "Governmental plan" has the meaning given such term under § 3(32) of the Employee Retirement Income Security Act of 1974
[29 U.S.C. § 1002(32) et seq.] and any federal governmental plan.
(10)a. "Health benefit plan" means any hospital or medical expense policy or certificate, major medical expense insurance
policy or certificate, any hospital or medical service plan contract, health maintenance organization or health service corporation
subscriber contract or any other similar health contract subject to the jurisdiction of the Commissioner.
b. "Health benefit plan" does not include: accident only; credit; dental; vision; Medicare supplement; benefits for long-term
care, home health care, community-based care or any combination thereof; disability income insurance; liability insurance
including general liability insurance and automobile liability insurance; coverage for on-site medical clinics; coverage issued
as a supplement to liability insurance, worker's compensation or similar insurance; or automobile medical payment insurance.
The term also excludes specified disease, hospital confinement indemnity or limited benefit health insurance if such types
of coverage do not provide coordination of benefits and are provided under separate policies or certificates; provided, that
the carrier offering such policies or certificates complies with the following:
1. The carrier files, on or before March 1 of each year, a certification with the Commissioner that contains the statement
and information described in sub-subparagraph 2. of this subparagraph.
2. The certification shall contain the following:
A. A statement from the carrier certifying that policies or certificates described in this subparagraph are being offered
and marketed as supplemental health insurance and not as a substitute for hospital or medical expense insurance or major medical
expense insurance.
B. A summary description of each policy or certificate described in this paragraph, including the average annual premium rates
(or range of premium rates in cases where premiums vary by age or other factors) charged for these policies and certificates
in this State.
3. In the case of a policy or certificate that is described in this paragraph and that is offered for the first time in this
State on or after July 1, 1997, the carrier files with the Commissioner the information and statement required in sub-subparagraph
2. of this subparagraph at least 30 days prior to the date the policy or certificate is issued or delivered in this State.
(11) "Health insurance" means insurance permitted to be written in accordance with § 903 of this title, other than credit
health insurance, and coverages written under Chapter 63 of this title, Health Service Corporations. For purposes of this
chapter, health service corporations shall be deemed to be engaged in the business of insurance.
(12) "Health status-related factor" means any of the following factors:
a. Health status;
b. Medical condition, including both physical and mental illnesses;
c. Claims experience;
d. Receipt of health care;
e. Medical history;
f. Genetic information, as defined in § 2317 of this title;
g. Evidence of insurability, including conditions arising out of acts of domestic violence;
h. Disability.
(13) "Medical care" means amounts paid for:
a. The diagnosis, cure, mitigation, treatment or prevention of disease or amounts paid for the purpose of affecting any structure
or function of the body;
b. Transportation primarily for and essential to medical care referred to in subparagraph a. of this paragraph; and
c. Insurance covering medical care referred to in subparagraphs a. and b. of this paragraph.
(14) "Network plan" means health insurance coverage offered by a health carrier under which the financing and delivery of
medical care including items and services paid for as medical care are provided, in whole or in part, through a defined set
of providers under contract with the carrier.
(15) "Policy" means the entire contract between the insurer and the insured, including the policy riders, endorsements and
the application, if attached, and also includes subscriber contracts issued by health service corporations.
(16) "Waiting period" means, with respect to an individual who is a potential participant or beneficiary in the plan, the
period that must pass with respect to the individual before the individual is eligible for benefits under the terms of the
plan. For purposes of calculating periods of creditable coverage, a waiting period shall not be considered a gap in coverage.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 2; 72 Del. Laws, c. 383, § 6; 74 Del. Laws, c. 157, § 3.;
§ 3603. Standards for policy provisions.
(a) The Commissioner shall issue reasonable regulations to establish specific standards, including standards of full and fair
disclosure, that set forth the manner, content and required disclosure for the sale of individual policies of health insurance
and subscriber contracts of health service corporations, other than conversion policies issued pursuant to a contractual conversion
privilege under a group or individual policy of health insurance, when such group or individual contract contains provisions
which are inconsistent with the requirements of this chapter or any regulation issued pursuant to this chapter, or to policies
being issued to employees or members being added to franchise plans in existence on January 12, 1984 or any regulation issued
pursuant to this chapter which shall be in addition to and in accordance with applicable laws of this State including the
applicable statutory provisions set forth in §§ 3303-3336 of this title which may cover but shall not be limited to:
(1) Terms of renewability;
(2) Initial and subsequent conditions of eligibility;
(3) Nonduplication of coverage provisions;
(4) Coverage of dependents;
(5) Preexisting conditions;
(6) Termination of insurance;
(7) Probationary periods;
(8) Limitations;
(9) Exceptions;
(10) Reductions;
(11) Elimination periods;
(12) Requirements for replacement;
(13) Recurrent conditions; and
(14) The definition of terms including but not limited to the following: Hospital, accident, sickness, injury, physician,
accidental means, total disability, partial disability, nervous disorder, guaranteed renewable and noncancellable.
(b) Subsection (a) of this section authorizes the Commissioner to establish specific standards for policy provisions which
will facilitate public understanding of such provisions. The subsection does not alter the requirements of §§ 3303-3336 (Uniform
Health Policy Provisions Law), or other specifically applicable state laws dealing with individual policy provisions. Regulations
adopted under the subsection should be consistent with §§ 3303-3336, and other applicable state laws relating to the subject
matter.
(c) The Commissioner may issue reasonable regulations that specify prohibited policies or policy provisions not otherwise
specifically authorized by statute which in the opinion of the Commissioner, are unjust, unfair or unfairly discriminatory
to the policyholder, any person insured under the policy or beneficiary.
64 Del. Laws, c. 142, § 1.;
§ 3604. Minimum standards for benefits.
(a) The Commissioner may issue regulations to establish minimum standards for benefits under each of the following categories
of coverage in individual policies, other than conversion policies issued pursuant to a contractual conversion privilege under
group or individual policy, when such group or individual contract contains provisions which are inconsistent with the requirements
of this chapter or any regulation issued pursuant to this chapter or to policies being issued to employees or members being
added to franchise plans in existence on January 12, 1984 or any regulation issued pursuant to this chapter, of health insurance
and subscriber contracts of health service corporations:
(1) Basic hospital expense coverage;
(2) Basic medical-surgical expense coverage;
(3) Hospital confinement indemnity coverage;
(4) Major medical expense coverage;
(5) Disability income protection coverage;
(6) Accident only coverage;
(7) Specified disease or specified accident coverage; and
(8) Limited benefit health coverage.
(b) Nothing in this section shall preclude the issuance of any policy or contract which combines 2 or more of the categories
of coverage enumerated in paragraphs (1)-(6) of subsection (a) of this section.
(c) No policy or contract shall be delivered or issued for delivery in this State which does not meet the prescribed minimum
standards for the categories of coverage listed in paragraphs (1)-(8) of subsection (a) of this section, or which does not
meet the other applicable requirements for such coverages as prescribed by this title.
(d) The Commissioner shall prescribe the method of identification of policies and contracts based upon coverages provided.
64 Del. Laws, c. 142, § 1.;
§ 3605. Disclosure requirements.
(a) In order to provide for full and fair disclosure in the sale of individual health insurance policies or subscriber contracts
of a health service corporation, no such policy or contract shall be delivered or issued for delivery in this State unless
the outline of coverage described in subsection (b) of this section either accompanies the policy or is delivered to the applicant
at the time the application is made and an acknowledgement of receipt or certificate of delivery of such outlines is provided
the insurer. In the event the policy is issued on a basis other than that applied for, the outline of coverage properly describing
the policy or contract must accompany the policy or contract when it is not the policy or contract for which application was
made.
(b) The Commissioner shall prescribe by regulation the format and content of the outline of coverage required by subsection
(a) of this section. "Format" means style, arrangement and overall appearance, including such items as the size, color and
prominence of type and the arrangement of text and captions. Such outline of coverage shall include:
(1) A statement identifying the applicable category or categories of coverage provided by the policy or contract as prescribed
in § 3604 of this title;
(2) A description of the principal benefits and coverage provided in the policy or contract;
(3) A statement of the exceptions, reductions and limitations contained in the policy or contract;
(4) A statement of the renewal provisions including any reservation by the insurer or health service corporation of a right
to change premiums;
(5) A statement that the outline is a summary of the policy or contract issued or applied for and that the policy or contract
should be consulted to determine governing contractual provisions.
(c) The outline of coverage shall not be considered to be part of the policy or subscriber contract for insurance.
(d) Every insurer or health service corporation electing to refuse coverage of an applicant or decline coverage of an insured
who is not included within the coverage of Chapter 23 of Title 19 shall disclose to such applicant or insured in writing the
fact of such noncoverage or declination of coverage. Any insurer or health insurer failing to disclose in writing such noncoverage
or declination of coverage shall be deemed to cover the applicant or insured under the health insurance policy then in effect.
64 Del. Laws, c. 142, § 1; 64 Del. Laws, c. 378, § 1.;
§ 3606. Preexisting conditions.
(a) Notwithstanding § 3306 of this title, if an insurer or a health service corporation elects to use a simplified application
form, with or without a question as to the applicant's health at the time of application, but without any questions concerning
the insurer's health history or medical treatment history, the policy must cover any loss occurring after 12 months from any
preexisting condition not specifically excluded from coverage by terms of the policy, and, except as so provided, the policy
or contract shall not include wording that would permit a defense based upon preexisting conditions.
(b) Notwithstanding subsection (a) of this section and § 3306 of this title, an insurer or a health service corporation which
issues a specified disease policy, regardless of whether such policy is issued on the basis of a detailed application form,
a simplified application form or an enrollment form, may not deny a claim for any covered loss that begins after the policy
has been in force for at least 6 months, unless such loss results from a preexisting condition which first manifests itself
within 6 months prior to the effective date of the policy or contract or was diagnosed by a physician at any time prior to
such date. Except for rescission for misrepresentation, no other defenses based upon preexisting conditions are permitted.
64 Del. Laws, c. 142, § 1.;
§ 3607. Limited guaranteed issue.
(a) Every carrier offering individual health benefit plans in Delaware shall offer and accept for enrollment, pursuant to
subsection (b) of this section, every federally eligible individual who applies for coverage within 63 days after termination
of such individual's prior coverage, except that this requirement shall not apply to carriers offering coverage only through
bona fide associations or to carriers offering individual coverage only through conversion policies.
(b) A carrier shall meet the requirements of subsection (a) of this section if:
(1) The carrier offers at least 2 different health benefit policy forms, both of which are designed for, are made generally
available and actively marketed to and enroll both federally eligible and other individuals; and
(2) The offering of policy forms includes, at a minimum:
a. The policy forms for health benefit plan coverage with the largest and next to largest premium volume of all such policy
forms offered by the carrier in Delaware; or
b. A lower-level coverage policy form and a higher-level coverage policy form which include benefits substantially similar
to other individual health insurance coverage offered by the carrier in Delaware and are covered under a risk adjustment,
risk spreading or financial subsidization method. As used in this subparagraph:
1. "Higher-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
15 percent greater than the actuarial value of lower-level coverage offered by the carrier in Delaware and the actuarial value
of the benefits under the coverage is at least 100 percent but not greater than 120 percent of the policy form weighted average.
2. "Lower-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
85 percent but not greater than 100 percent of the policy form weighted average.
3. "Policy form weighted average" means the average actuarial value of the benefits provided by all the health insurance coverage
issued (as elected by the carrier) either by that carrier or, if such data are available, by all carriers in Delaware in the
individual health benefit plan market during the previous year (not including coverage issued under this section) weighted
by enrollment for the different coverage.
c. Preexisting condition limitations shall not be applied to federally eligible individuals for coverage provided pursuant
to this section.
(c) With respect to the provisions of subsection (b) of this section, a carrier that offers coverage in the individual market
through a network plan may limit the individuals who may be enrolled to those that live, reside or work within the service
area of the plan. Such a carrier may deny coverage to eligible individuals if it demonstrates to the Commissioner that it
will not have the capacity to deliver services adequately to additional enrollees and it is applying this subsection uniformly
to individuals without regard to any health status-related factor of such individuals and without regard to whether the individuals
are eligible individuals.
(d) A carrier may apply to the Commissioner to suspend, for a period of time, its duty to issue coverage pursuant to subsection
(b) of this section where continued compliance would adversely affect the financial condition of the company. Where such a
suspension is granted, the carrier may not offer coverage in the individual market for a period of at least 180 days after
the suspension is granted.
(e) For the purposes of this section, the term "health benefit plan" as defined in § 3602(10) of this title does not include
nonrenewable short-term individual health benefit plans with a duration of 6 months or less.
71 Del. Laws, c. 143, § 3; 72 Del. Laws, c. 383, § 3.;
§ 3608. Renewability of coverage.
(a) An individual health benefit plan shall be renewable with respect to an enrollee or dependents at the option of the enrollee,
except in any of the following cases:
(1) The individual has failed to pay premiums or contributions in accordance with the terms of the health benefit plan or
the health carrier has not received timely premium payments;
(2) The individual has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material
fact under the terms of the coverage;
(3) A decision by the individual carrier to discontinue offering a particular type of health benefit plan in the state's individual
insurance market. A type of health benefit plan may be discontinued by the carrier in the individual market only if the carrier:
a. Provides notice of the decision not to renew coverage to all affected individuals and to the Commissioner in each state
in which an affected insured individual is known to reside at least 90 days prior to the nonrenewal of any health benefit
plans by the carrier. Notice to the Commissioner under this subparagraph shall be provided at least 3 working days prior to
the notice to the affected individuals;
b. Offers to each individual provided the particular type of health benefit plan the option to purchase all other health benefit
plans currently being offered by the carrier to individuals in the state; and
c. In exercising the option to discontinue the particular type of health benefit plan and, in offering the option of coverage
under paragraph (3) of this subsection, the carrier acts uniformly without regard to the claims experience of any affected
individual or any health status-related factor relating to any covered individuals or beneficiaries who may become eligible
for the coverage;
(4) The carrier elects to discontinue offering and to nonrenew all its individual health benefit plans delivered or issued
for delivery in the state. In that case, the carrier shall provide notice of its decision not to renew coverage to all enrollees
and to the Commissioner in each state in which an enrollee is known to reside at least 180 days prior to the nonrenewal of
the health benefit plan by the carrier. Notice to the Commissioner under this paragraph shall be provided at least 3 working
days prior to the notice of the enrollees;
(5) The Commissioner finds that the continuation of the coverage would not be in the best interests of the enrollees, the
plan is obsolete or would impair the carrier's ability to meet its contractual obligations. Once the Commissioner has made
such a finding, the carrier shall provide notice to each affected covered individual provided coverage of this type of such
discontinuation and shall provide each affected covered individual the opportunity to purchase any other individual health
insurance coverage being offered by the carrier. In exercising this option, the carrier shall act uniformly without regard
for any health status-related factor of enrolled individuals or individuals who may become eligible for such coverage;
(6) The Commissioner finds that the product form is being uniformly modified and is being replaced with comparable coverage.
(b) An individual carrier that elects not to renew all its health benefit plans under subsection (a)(4) of this section shall
be prohibited from writing new business in the individual market in this State for a period of 5 years from the date of the
discontinuation of the last health benefit plan not so renewed.
(c) In the case of an individual carrier doing business in 1 established geographic service area of the state, the rules set
forth in this section shall apply only to the carrier's operations in that service area.
(d) An individual carrier offering coverage through a network plan shall not be required to renew, offer coverage or accept
applications pursuant to subsection (a) of this section to an eligible person who no longer resides, lives or works in the
service area or in an area for which the carrier is not authorized to do business, but only if coverage is terminated under
this paragraph uniformly without regard to any health status-related factor of covered individuals.
(e) In applying this section in the case of a health benefit plan that is made available in the individual market to individuals
only through 1 or more bona fide associations, a reference to an "individual" is deemed to include a reference to such an
association (of which the individual is a member).
CHAPTER 36. INDIVIDUAL HEALTH INSURANCE MINIMUM STANDARDS
§ 3601. Purpose and scope.
(a) The purpose of this chapter shall be to provide reasonable standardization and simplification of terms and coverages of
individual health insurance policies and subscriber contracts of health service corporations to facilitate public understanding
and comparison, to eliminate provisions contained in individual health insurance policies and subscriber contracts of health
service corporations which may be misleading or unreasonably confusing in connection either with the purchase of such coverages
or with the settlement of claims, and to provide for full disclosure in the sale of health insurance coverages. Additionally,
the purpose of this chapter is to promote the availability of health insurance coverage to recently uninsured individuals,
regardless of their health status or claims experience, and to improve the overall fairness and efficiency of the individual
health insurance market.
(b) This chapter notwithstanding, Medicare supplement coverage shall be governed by Chapter 34, Medicare Supplement Insurance
Minimum Standards, of this title.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 1.;
§ 3602. Definitions.
As used in this chapter:
(1) "Affiliation period" means a period of time not to exceed 2 months (3 months for late enrollees) during which a health
maintenance organization does not collect premiums and coverage issued is not effective.
(2) "Bona fide association" means, with respect to health insurance coverage offered in Delaware, an association which:
a. Has been actively in existence for at least 5 years;
b. Has been formed and maintained in good faith for purposes other than obtaining insurance and does not condition membership
on the purchase of association-sponsored insurance;
c. Does not condition membership in the association on any health status-related factor relating to an individual (including
an employee of an employer or a dependent of an employee) and clearly so states in all membership and application materials;
d. Makes health insurance coverage offered through the association available to all members regardless of any health status-related
factor relating to such members (or individuals eligible for coverage through a member) and clearly so states in all marketing
and application materials;
e. Does not make health insurance coverage offered through the association available other than in connection with a member
of the association and clearly so states in all marketing and application materials; and
f. Provides and annually updates information necessary for the Commissioner to determine whether or not an association meets
the definition of a bona fide association before qualifying as a bona fide association for the purposes of this chapter.
(3) "Carrier" means an entity subject to the insurance laws and regulations of this State, or subject to the jurisdiction
of the Commissioner, that contracts or offers to contract to provide, deliver, arrange for, pay for or reimburse any of the
costs of health care services, including a sickness and accident insurance company, a health maintenance organization, a nonprofit
hospital and health service corporation or any other entity providing a plan of health insurance, health benefits or health
services. "Carrier" also includes any third-party administrator or other entity that adjusts, administers, or settles claims
in connection with health benefit plans.
(4) "Church plan" has the meaning given such term under § 3(33) of the Employee Retirement Income Security Act of 1974 [29
U.S.C. § 1002(33)].
(5) "Creditable coverage" means, with respect to an individual, health benefits or coverage provided under any of the following:
a. A group health benefit plan;
b. An individual health benefit plan or individual insurance coverage;
c. Part A or Part B of Title XVIII of the Social Security Act [42 U.S.C. § 1395 et seq. or 42 U.S.C. § 1395j et seq.];
d. Title XIX of the Social Security Act [42 U.S.C. § 1396 et seq.], other than coverage consisting solely of benefits under
§ 1928 [42 U.S.C. § 1396s];
e. Chapter 55 of Title 10, United States Code [10 U.S.C. § 1071 et seq.];
f. A medical care program of the Indian Health Service or of a tribal organization;
g. A state health benefits risk pool;
h. A health plan offered under Chapter 89 of Title 5, United States Code [5 U.S.C. § 8901 et seq.];
i. A public health plan as defined in federal regulations;
j. A health benefit plan under § 5(e) of the Peace Corps Act [22 U.S.C. § 2504(e)]. Such term does not include coverage consisting
solely of coverage of excepted benefits as defined in subparagraph (10)b. of this section.
(6) "Dependent" means a spouse, an unmarried child under the age of 18 years, an unmarried child who is a full-time student
under the age of 25 years and who is financially dependent upon the enrollee and an unmarried child of any age who is medically
certified as totally disabled and dependent upon the enrollee.
(7) "Federally eligible individual" means an individual:
a. For whom, as of the date on which the individual seeks coverage under this chapter, the aggregate of the periods of creditable
coverage, as defined in this section, is 18 or more months;
b. Whose most recent prior creditable coverage was under a group health plan, governmental plan, church plan or health insurance
coverage offered in connection with any such plan;
c. Who is not eligible for coverage under a group health plan, Part A or Part B of Title XVIII of the Social Security Act
or a state plan under Title XIX of such act or any successor program, and who does not have other health insurance coverage;
d. With respect to whom the most recent coverage within the period of aggregate creditable coverage was not terminated based
on a factor relating to nonpayment of premiums or fraud;
e. Who, if offered the option of continuation coverage under a COBRA continuation provision or under a similar state program,
elected such coverage; and
f. Who has exhausted such continuation coverage under such provision or program, if the individual elected the continuation
coverage described in subparagraph e. of this paragraph.
(8) "Form" means policies, contracts, riders, endorsements and applications required to be filed with the Commissioner pursuant
to §§ 2712 and 6306 of this title.
(9) "Governmental plan" has the meaning given such term under § 3(32) of the Employee Retirement Income Security Act of 1974
[29 U.S.C. § 1002(32) et seq.] and any federal governmental plan.
(10)a. "Health benefit plan" means any hospital or medical expense policy or certificate, major medical expense insurance
policy or certificate, any hospital or medical service plan contract, health maintenance organization or health service corporation
subscriber contract or any other similar health contract subject to the jurisdiction of the Commissioner.
b. "Health benefit plan" does not include: accident only; credit; dental; vision; Medicare supplement; benefits for long-term
care, home health care, community-based care or any combination thereof; disability income insurance; liability insurance
including general liability insurance and automobile liability insurance; coverage for on-site medical clinics; coverage issued
as a supplement to liability insurance, worker's compensation or similar insurance; or automobile medical payment insurance.
The term also excludes specified disease, hospital confinement indemnity or limited benefit health insurance if such types
of coverage do not provide coordination of benefits and are provided under separate policies or certificates; provided, that
the carrier offering such policies or certificates complies with the following:
1. The carrier files, on or before March 1 of each year, a certification with the Commissioner that contains the statement
and information described in sub-subparagraph 2. of this subparagraph.
2. The certification shall contain the following:
A. A statement from the carrier certifying that policies or certificates described in this subparagraph are being offered
and marketed as supplemental health insurance and not as a substitute for hospital or medical expense insurance or major medical
expense insurance.
B. A summary description of each policy or certificate described in this paragraph, including the average annual premium rates
(or range of premium rates in cases where premiums vary by age or other factors) charged for these policies and certificates
in this State.
3. In the case of a policy or certificate that is described in this paragraph and that is offered for the first time in this
State on or after July 1, 1997, the carrier files with the Commissioner the information and statement required in sub-subparagraph
2. of this subparagraph at least 30 days prior to the date the policy or certificate is issued or delivered in this State.
(11) "Health insurance" means insurance permitted to be written in accordance with § 903 of this title, other than credit
health insurance, and coverages written under Chapter 63 of this title, Health Service Corporations. For purposes of this
chapter, health service corporations shall be deemed to be engaged in the business of insurance.
(12) "Health status-related factor" means any of the following factors:
a. Health status;
b. Medical condition, including both physical and mental illnesses;
c. Claims experience;
d. Receipt of health care;
e. Medical history;
f. Genetic information, as defined in § 2317 of this title;
g. Evidence of insurability, including conditions arising out of acts of domestic violence;
h. Disability.
(13) "Medical care" means amounts paid for:
a. The diagnosis, cure, mitigation, treatment or prevention of disease or amounts paid for the purpose of affecting any structure
or function of the body;
b. Transportation primarily for and essential to medical care referred to in subparagraph a. of this paragraph; and
c. Insurance covering medical care referred to in subparagraphs a. and b. of this paragraph.
(14) "Network plan" means health insurance coverage offered by a health carrier under which the financing and delivery of
medical care including items and services paid for as medical care are provided, in whole or in part, through a defined set
of providers under contract with the carrier.
(15) "Policy" means the entire contract between the insurer and the insured, including the policy riders, endorsements and
the application, if attached, and also includes subscriber contracts issued by health service corporations.
(16) "Waiting period" means, with respect to an individual who is a potential participant or beneficiary in the plan, the
period that must pass with respect to the individual before the individual is eligible for benefits under the terms of the
plan. For purposes of calculating periods of creditable coverage, a waiting period shall not be considered a gap in coverage.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 2; 72 Del. Laws, c. 383, § 6; 74 Del. Laws, c. 157, § 3.;
§ 3603. Standards for policy provisions.
(a) The Commissioner shall issue reasonable regulations to establish specific standards, including standards of full and fair
disclosure, that set forth the manner, content and required disclosure for the sale of individual policies of health insurance
and subscriber contracts of health service corporations, other than conversion policies issued pursuant to a contractual conversion
privilege under a group or individual policy of health insurance, when such group or individual contract contains provisions
which are inconsistent with the requirements of this chapter or any regulation issued pursuant to this chapter, or to policies
being issued to employees or members being added to franchise plans in existence on January 12, 1984 or any regulation issued
pursuant to this chapter which shall be in addition to and in accordance with applicable laws of this State including the
applicable statutory provisions set forth in §§ 3303-3336 of this title which may cover but shall not be limited to:
(1) Terms of renewability;
(2) Initial and subsequent conditions of eligibility;
(3) Nonduplication of coverage provisions;
(4) Coverage of dependents;
(5) Preexisting conditions;
(6) Termination of insurance;
(7) Probationary periods;
(8) Limitations;
(9) Exceptions;
(10) Reductions;
(11) Elimination periods;
(12) Requirements for replacement;
(13) Recurrent conditions; and
(14) The definition of terms including but not limited to the following: Hospital, accident, sickness, injury, physician,
accidental means, total disability, partial disability, nervous disorder, guaranteed renewable and noncancellable.
(b) Subsection (a) of this section authorizes the Commissioner to establish specific standards for policy provisions which
will facilitate public understanding of such provisions. The subsection does not alter the requirements of §§ 3303-3336 (Uniform
Health Policy Provisions Law), or other specifically applicable state laws dealing with individual policy provisions. Regulations
adopted under the subsection should be consistent with §§ 3303-3336, and other applicable state laws relating to the subject
matter.
(c) The Commissioner may issue reasonable regulations that specify prohibited policies or policy provisions not otherwise
specifically authorized by statute which in the opinion of the Commissioner, are unjust, unfair or unfairly discriminatory
to the policyholder, any person insured under the policy or beneficiary.
64 Del. Laws, c. 142, § 1.;
§ 3604. Minimum standards for benefits.
(a) The Commissioner may issue regulations to establish minimum standards for benefits under each of the following categories
of coverage in individual policies, other than conversion policies issued pursuant to a contractual conversion privilege under
group or individual policy, when such group or individual contract contains provisions which are inconsistent with the requirements
of this chapter or any regulation issued pursuant to this chapter or to policies being issued to employees or members being
added to franchise plans in existence on January 12, 1984 or any regulation issued pursuant to this chapter, of health insurance
and subscriber contracts of health service corporations:
(1) Basic hospital expense coverage;
(2) Basic medical-surgical expense coverage;
(3) Hospital confinement indemnity coverage;
(4) Major medical expense coverage;
(5) Disability income protection coverage;
(6) Accident only coverage;
(7) Specified disease or specified accident coverage; and
(8) Limited benefit health coverage.
(b) Nothing in this section shall preclude the issuance of any policy or contract which combines 2 or more of the categories
of coverage enumerated in paragraphs (1)-(6) of subsection (a) of this section.
(c) No policy or contract shall be delivered or issued for delivery in this State which does not meet the prescribed minimum
standards for the categories of coverage listed in paragraphs (1)-(8) of subsection (a) of this section, or which does not
meet the other applicable requirements for such coverages as prescribed by this title.
(d) The Commissioner shall prescribe the method of identification of policies and contracts based upon coverages provided.
64 Del. Laws, c. 142, § 1.;
§ 3605. Disclosure requirements.
(a) In order to provide for full and fair disclosure in the sale of individual health insurance policies or subscriber contracts
of a health service corporation, no such policy or contract shall be delivered or issued for delivery in this State unless
the outline of coverage described in subsection (b) of this section either accompanies the policy or is delivered to the applicant
at the time the application is made and an acknowledgement of receipt or certificate of delivery of such outlines is provided
the insurer. In the event the policy is issued on a basis other than that applied for, the outline of coverage properly describing
the policy or contract must accompany the policy or contract when it is not the policy or contract for which application was
made.
(b) The Commissioner shall prescribe by regulation the format and content of the outline of coverage required by subsection
(a) of this section. "Format" means style, arrangement and overall appearance, including such items as the size, color and
prominence of type and the arrangement of text and captions. Such outline of coverage shall include:
(1) A statement identifying the applicable category or categories of coverage provided by the policy or contract as prescribed
in § 3604 of this title;
(2) A description of the principal benefits and coverage provided in the policy or contract;
(3) A statement of the exceptions, reductions and limitations contained in the policy or contract;
(4) A statement of the renewal provisions including any reservation by the insurer or health service corporation of a right
to change premiums;
(5) A statement that the outline is a summary of the policy or contract issued or applied for and that the policy or contract
should be consulted to determine governing contractual provisions.
(c) The outline of coverage shall not be considered to be part of the policy or subscriber contract for insurance.
(d) Every insurer or health service corporation electing to refuse coverage of an applicant or decline coverage of an insured
who is not included within the coverage of Chapter 23 of Title 19 shall disclose to such applicant or insured in writing the
fact of such noncoverage or declination of coverage. Any insurer or health insurer failing to disclose in writing such noncoverage
or declination of coverage shall be deemed to cover the applicant or insured under the health insurance policy then in effect.
64 Del. Laws, c. 142, § 1; 64 Del. Laws, c. 378, § 1.;
§ 3606. Preexisting conditions.
(a) Notwithstanding § 3306 of this title, if an insurer or a health service corporation elects to use a simplified application
form, with or without a question as to the applicant's health at the time of application, but without any questions concerning
the insurer's health history or medical treatment history, the policy must cover any loss occurring after 12 months from any
preexisting condition not specifically excluded from coverage by terms of the policy, and, except as so provided, the policy
or contract shall not include wording that would permit a defense based upon preexisting conditions.
(b) Notwithstanding subsection (a) of this section and § 3306 of this title, an insurer or a health service corporation which
issues a specified disease policy, regardless of whether such policy is issued on the basis of a detailed application form,
a simplified application form or an enrollment form, may not deny a claim for any covered loss that begins after the policy
has been in force for at least 6 months, unless such loss results from a preexisting condition which first manifests itself
within 6 months prior to the effective date of the policy or contract or was diagnosed by a physician at any time prior to
such date. Except for rescission for misrepresentation, no other defenses based upon preexisting conditions are permitted.
64 Del. Laws, c. 142, § 1.;
§ 3607. Limited guaranteed issue.
(a) Every carrier offering individual health benefit plans in Delaware shall offer and accept for enrollment, pursuant to
subsection (b) of this section, every federally eligible individual who applies for coverage within 63 days after termination
of such individual's prior coverage, except that this requirement shall not apply to carriers offering coverage only through
bona fide associations or to carriers offering individual coverage only through conversion policies.
(b) A carrier shall meet the requirements of subsection (a) of this section if:
(1) The carrier offers at least 2 different health benefit policy forms, both of which are designed for, are made generally
available and actively marketed to and enroll both federally eligible and other individuals; and
(2) The offering of policy forms includes, at a minimum:
a. The policy forms for health benefit plan coverage with the largest and next to largest premium volume of all such policy
forms offered by the carrier in Delaware; or
b. A lower-level coverage policy form and a higher-level coverage policy form which include benefits substantially similar
to other individual health insurance coverage offered by the carrier in Delaware and are covered under a risk adjustment,
risk spreading or financial subsidization method. As used in this subparagraph:
1. "Higher-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
15 percent greater than the actuarial value of lower-level coverage offered by the carrier in Delaware and the actuarial value
of the benefits under the coverage is at least 100 percent but not greater than 120 percent of the policy form weighted average.
2. "Lower-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
85 percent but not greater than 100 percent of the policy form weighted average.
3. "Policy form weighted average" means the average actuarial value of the benefits provided by all the health insurance coverage
issued (as elected by the carrier) either by that carrier or, if such data are available, by all carriers in Delaware in the
individual health benefit plan market during the previous year (not including coverage issued under this section) weighted
by enrollment for the different coverage.
c. Preexisting condition limitations shall not be applied to federally eligible individuals for coverage provided pursuant
to this section.
(c) With respect to the provisions of subsection (b) of this section, a carrier that offers coverage in the individual market
through a network plan may limit the individuals who may be enrolled to those that live, reside or work within the service
area of the plan. Such a carrier may deny coverage to eligible individuals if it demonstrates to the Commissioner that it
will not have the capacity to deliver services adequately to additional enrollees and it is applying this subsection uniformly
to individuals without regard to any health status-related factor of such individuals and without regard to whether the individuals
are eligible individuals.
(d) A carrier may apply to the Commissioner to suspend, for a period of time, its duty to issue coverage pursuant to subsection
(b) of this section where continued compliance would adversely affect the financial condition of the company. Where such a
suspension is granted, the carrier may not offer coverage in the individual market for a period of at least 180 days after
the suspension is granted.
(e) For the purposes of this section, the term "health benefit plan" as defined in § 3602(10) of this title does not include
nonrenewable short-term individual health benefit plans with a duration of 6 months or less.
71 Del. Laws, c. 143, § 3; 72 Del. Laws, c. 383, § 3.;
§ 3608. Renewability of coverage.
(a) An individual health benefit plan shall be renewable with respect to an enrollee or dependents at the option of the enrollee,
except in any of the following cases:
(1) The individual has failed to pay premiums or contributions in accordance with the terms of the health benefit plan or
the health carrier has not received timely premium payments;
(2) The individual has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material
fact under the terms of the coverage;
(3) A decision by the individual carrier to discontinue offering a particular type of health benefit plan in the state's individual
insurance market. A type of health benefit plan may be discontinued by the carrier in the individual market only if the carrier:
a. Provides notice of the decision not to renew coverage to all affected individuals and to the Commissioner in each state
in which an affected insured individual is known to reside at least 90 days prior to the nonrenewal of any health benefit
plans by the carrier. Notice to the Commissioner under this subparagraph shall be provided at least 3 working days prior to
the notice to the affected individuals;
b. Offers to each individual provided the particular type of health benefit plan the option to purchase all other health benefit
plans currently being offered by the carrier to individuals in the state; and
c. In exercising the option to discontinue the particular type of health benefit plan and, in offering the option of coverage
under paragraph (3) of this subsection, the carrier acts uniformly without regard to the claims experience of any affected
individual or any health status-related factor relating to any covered individuals or beneficiaries who may become eligible
for the coverage;
(4) The carrier elects to discontinue offering and to nonrenew all its individual health benefit plans delivered or issued
for delivery in the state. In that case, the carrier shall provide notice of its decision not to renew coverage to all enrollees
and to the Commissioner in each state in which an enrollee is known to reside at least 180 days prior to the nonrenewal of
the health benefit plan by the carrier. Notice to the Commissioner under this paragraph shall be provided at least 3 working
days prior to the notice of the enrollees;
(5) The Commissioner finds that the continuation of the coverage would not be in the best interests of the enrollees, the
plan is obsolete or would impair the carrier's ability to meet its contractual obligations. Once the Commissioner has made
such a finding, the carrier shall provide notice to each affected covered individual provided coverage of this type of such
discontinuation and shall provide each affected covered individual the opportunity to purchase any other individual health
insurance coverage being offered by the carrier. In exercising this option, the carrier shall act uniformly without regard
for any health status-related factor of enrolled individuals or individuals who may become eligible for such coverage;
(6) The Commissioner finds that the product form is being uniformly modified and is being replaced with comparable coverage.
(b) An individual carrier that elects not to renew all its health benefit plans under subsection (a)(4) of this section shall
be prohibited from writing new business in the individual market in this State for a period of 5 years from the date of the
discontinuation of the last health benefit plan not so renewed.
(c) In the case of an individual carrier doing business in 1 established geographic service area of the state, the rules set
forth in this section shall apply only to the carrier's operations in that service area.
(d) An individual carrier offering coverage through a network plan shall not be required to renew, offer coverage or accept
applications pursuant to subsection (a) of this section to an eligible person who no longer resides, lives or works in the
service area or in an area for which the carrier is not authorized to do business, but only if coverage is terminated under
this paragraph uniformly without regard to any health status-related factor of covered individuals.
(e) In applying this section in the case of a health benefit plan that is made available in the individual market to individuals
only through 1 or more bona fide associations, a reference to an "individual" is deemed to include a reference to such an
association (of which the individual is a member).
CHAPTER 36. INDIVIDUAL HEALTH INSURANCE MINIMUM STANDARDS
§ 3601. Purpose and scope.
(a) The purpose of this chapter shall be to provide reasonable standardization and simplification of terms and coverages of
individual health insurance policies and subscriber contracts of health service corporations to facilitate public understanding
and comparison, to eliminate provisions contained in individual health insurance policies and subscriber contracts of health
service corporations which may be misleading or unreasonably confusing in connection either with the purchase of such coverages
or with the settlement of claims, and to provide for full disclosure in the sale of health insurance coverages. Additionally,
the purpose of this chapter is to promote the availability of health insurance coverage to recently uninsured individuals,
regardless of their health status or claims experience, and to improve the overall fairness and efficiency of the individual
health insurance market.
(b) This chapter notwithstanding, Medicare supplement coverage shall be governed by Chapter 34, Medicare Supplement Insurance
Minimum Standards, of this title.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 1.;
§ 3602. Definitions.
As used in this chapter:
(1) "Affiliation period" means a period of time not to exceed 2 months (3 months for late enrollees) during which a health
maintenance organization does not collect premiums and coverage issued is not effective.
(2) "Bona fide association" means, with respect to health insurance coverage offered in Delaware, an association which:
a. Has been actively in existence for at least 5 years;
b. Has been formed and maintained in good faith for purposes other than obtaining insurance and does not condition membership
on the purchase of association-sponsored insurance;
c. Does not condition membership in the association on any health status-related factor relating to an individual (including
an employee of an employer or a dependent of an employee) and clearly so states in all membership and application materials;
d. Makes health insurance coverage offered through the association available to all members regardless of any health status-related
factor relating to such members (or individuals eligible for coverage through a member) and clearly so states in all marketing
and application materials;
e. Does not make health insurance coverage offered through the association available other than in connection with a member
of the association and clearly so states in all marketing and application materials; and
f. Provides and annually updates information necessary for the Commissioner to determine whether or not an association meets
the definition of a bona fide association before qualifying as a bona fide association for the purposes of this chapter.
(3) "Carrier" means an entity subject to the insurance laws and regulations of this State, or subject to the jurisdiction
of the Commissioner, that contracts or offers to contract to provide, deliver, arrange for, pay for or reimburse any of the
costs of health care services, including a sickness and accident insurance company, a health maintenance organization, a nonprofit
hospital and health service corporation or any other entity providing a plan of health insurance, health benefits or health
services. "Carrier" also includes any third-party administrator or other entity that adjusts, administers, or settles claims
in connection with health benefit plans.
(4) "Church plan" has the meaning given such term under § 3(33) of the Employee Retirement Income Security Act of 1974 [29
U.S.C. § 1002(33)].
(5) "Creditable coverage" means, with respect to an individual, health benefits or coverage provided under any of the following:
a. A group health benefit plan;
b. An individual health benefit plan or individual insurance coverage;
c. Part A or Part B of Title XVIII of the Social Security Act [42 U.S.C. § 1395 et seq. or 42 U.S.C. § 1395j et seq.];
d. Title XIX of the Social Security Act [42 U.S.C. § 1396 et seq.], other than coverage consisting solely of benefits under
§ 1928 [42 U.S.C. § 1396s];
e. Chapter 55 of Title 10, United States Code [10 U.S.C. § 1071 et seq.];
f. A medical care program of the Indian Health Service or of a tribal organization;
g. A state health benefits risk pool;
h. A health plan offered under Chapter 89 of Title 5, United States Code [5 U.S.C. § 8901 et seq.];
i. A public health plan as defined in federal regulations;
j. A health benefit plan under § 5(e) of the Peace Corps Act [22 U.S.C. § 2504(e)]. Such term does not include coverage consisting
solely of coverage of excepted benefits as defined in subparagraph (10)b. of this section.
(6) "Dependent" means a spouse, an unmarried child under the age of 18 years, an unmarried child who is a full-time student
under the age of 25 years and who is financially dependent upon the enrollee and an unmarried child of any age who is medically
certified as totally disabled and dependent upon the enrollee.
(7) "Federally eligible individual" means an individual:
a. For whom, as of the date on which the individual seeks coverage under this chapter, the aggregate of the periods of creditable
coverage, as defined in this section, is 18 or more months;
b. Whose most recent prior creditable coverage was under a group health plan, governmental plan, church plan or health insurance
coverage offered in connection with any such plan;
c. Who is not eligible for coverage under a group health plan, Part A or Part B of Title XVIII of the Social Security Act
or a state plan under Title XIX of such act or any successor program, and who does not have other health insurance coverage;
d. With respect to whom the most recent coverage within the period of aggregate creditable coverage was not terminated based
on a factor relating to nonpayment of premiums or fraud;
e. Who, if offered the option of continuation coverage under a COBRA continuation provision or under a similar state program,
elected such coverage; and
f. Who has exhausted such continuation coverage under such provision or program, if the individual elected the continuation
coverage described in subparagraph e. of this paragraph.
(8) "Form" means policies, contracts, riders, endorsements and applications required to be filed with the Commissioner pursuant
to §§ 2712 and 6306 of this title.
(9) "Governmental plan" has the meaning given such term under § 3(32) of the Employee Retirement Income Security Act of 1974
[29 U.S.C. § 1002(32) et seq.] and any federal governmental plan.
(10)a. "Health benefit plan" means any hospital or medical expense policy or certificate, major medical expense insurance
policy or certificate, any hospital or medical service plan contract, health maintenance organization or health service corporation
subscriber contract or any other similar health contract subject to the jurisdiction of the Commissioner.
b. "Health benefit plan" does not include: accident only; credit; dental; vision; Medicare supplement; benefits for long-term
care, home health care, community-based care or any combination thereof; disability income insurance; liability insurance
including general liability insurance and automobile liability insurance; coverage for on-site medical clinics; coverage issued
as a supplement to liability insurance, worker's compensation or similar insurance; or automobile medical payment insurance.
The term also excludes specified disease, hospital confinement indemnity or limited benefit health insurance if such types
of coverage do not provide coordination of benefits and are provided under separate policies or certificates; provided, that
the carrier offering such policies or certificates complies with the following:
1. The carrier files, on or before March 1 of each year, a certification with the Commissioner that contains the statement
and information described in sub-subparagraph 2. of this subparagraph.
2. The certification shall contain the following:
A. A statement from the carrier certifying that policies or certificates described in this subparagraph are being offered
and marketed as supplemental health insurance and not as a substitute for hospital or medical expense insurance or major medical
expense insurance.
B. A summary description of each policy or certificate described in this paragraph, including the average annual premium rates
(or range of premium rates in cases where premiums vary by age or other factors) charged for these policies and certificates
in this State.
3. In the case of a policy or certificate that is described in this paragraph and that is offered for the first time in this
State on or after July 1, 1997, the carrier files with the Commissioner the information and statement required in sub-subparagraph
2. of this subparagraph at least 30 days prior to the date the policy or certificate is issued or delivered in this State.
(11) "Health insurance" means insurance permitted to be written in accordance with § 903 of this title, other than credit
health insurance, and coverages written under Chapter 63 of this title, Health Service Corporations. For purposes of this
chapter, health service corporations shall be deemed to be engaged in the business of insurance.
(12) "Health status-related factor" means any of the following factors:
a. Health status;
b. Medical condition, including both physical and mental illnesses;
c. Claims experience;
d. Receipt of health care;
e. Medical history;
f. Genetic information, as defined in § 2317 of this title;
g. Evidence of insurability, including conditions arising out of acts of domestic violence;
h. Disability.
(13) "Medical care" means amounts paid for:
a. The diagnosis, cure, mitigation, treatment or prevention of disease or amounts paid for the purpose of affecting any structure
or function of the body;
b. Transportation primarily for and essential to medical care referred to in subparagraph a. of this paragraph; and
c. Insurance covering medical care referred to in subparagraphs a. and b. of this paragraph.
(14) "Network plan" means health insurance coverage offered by a health carrier under which the financing and delivery of
medical care including items and services paid for as medical care are provided, in whole or in part, through a defined set
of providers under contract with the carrier.
(15) "Policy" means the entire contract between the insurer and the insured, including the policy riders, endorsements and
the application, if attached, and also includes subscriber contracts issued by health service corporations.
(16) "Waiting period" means, with respect to an individual who is a potential participant or beneficiary in the plan, the
period that must pass with respect to the individual before the individual is eligible for benefits under the terms of the
plan. For purposes of calculating periods of creditable coverage, a waiting period shall not be considered a gap in coverage.
64 Del. Laws, c. 142, § 1; 71 Del. Laws, c. 143, § 2; 72 Del. Laws, c. 383, § 6; 74 Del. Laws, c. 157, § 3.;
§ 3603. Standards for policy provisions.
(a) The Commissioner shall issue reasonable regulations to establish specific standards, including standards of full and fair
disclosure, that set forth the manner, content and required disclosure for the sale of individual policies of health insurance
and subscriber contracts of health service corporations, other than conversion policies issued pursuant to a contractual conversion
privilege under a group or individual policy of health insurance, when such group or individual contract contains provisions
which are inconsistent with the requirements of this chapter or any regulation issued pursuant to this chapter, or to policies
being issued to employees or members being added to franchise plans in existence on January 12, 1984 or any regulation issued
pursuant to this chapter which shall be in addition to and in accordance with applicable laws of this State including the
applicable statutory provisions set forth in §§ 3303-3336 of this title which may cover but shall not be limited to:
(1) Terms of renewability;
(2) Initial and subsequent conditions of eligibility;
(3) Nonduplication of coverage provisions;
(4) Coverage of dependents;
(5) Preexisting conditions;
(6) Termination of insurance;
(7) Probationary periods;
(8) Limitations;
(9) Exceptions;
(10) Reductions;
(11) Elimination periods;
(12) Requirements for replacement;
(13) Recurrent conditions; and
(14) The definition of terms including but not limited to the following: Hospital, accident, sickness, injury, physician,
accidental means, total disability, partial disability, nervous disorder, guaranteed renewable and noncancellable.
(b) Subsection (a) of this section authorizes the Commissioner to establish specific standards for policy provisions which
will facilitate public understanding of such provisions. The subsection does not alter the requirements of §§ 3303-3336 (Uniform
Health Policy Provisions Law), or other specifically applicable state laws dealing with individual policy provisions. Regulations
adopted under the subsection should be consistent with §§ 3303-3336, and other applicable state laws relating to the subject
matter.
(c) The Commissioner may issue reasonable regulations that specify prohibited policies or policy provisions not otherwise
specifically authorized by statute which in the opinion of the Commissioner, are unjust, unfair or unfairly discriminatory
to the policyholder, any person insured under the policy or beneficiary.
64 Del. Laws, c. 142, § 1.;
§ 3604. Minimum standards for benefits.
(a) The Commissioner may issue regulations to establish minimum standards for benefits under each of the following categories
of coverage in individual policies, other than conversion policies issued pursuant to a contractual conversion privilege under
group or individual policy, when such group or individual contract contains provisions which are inconsistent with the requirements
of this chapter or any regulation issued pursuant to this chapter or to policies being issued to employees or members being
added to franchise plans in existence on January 12, 1984 or any regulation issued pursuant to this chapter, of health insurance
and subscriber contracts of health service corporations:
(1) Basic hospital expense coverage;
(2) Basic medical-surgical expense coverage;
(3) Hospital confinement indemnity coverage;
(4) Major medical expense coverage;
(5) Disability income protection coverage;
(6) Accident only coverage;
(7) Specified disease or specified accident coverage; and
(8) Limited benefit health coverage.
(b) Nothing in this section shall preclude the issuance of any policy or contract which combines 2 or more of the categories
of coverage enumerated in paragraphs (1)-(6) of subsection (a) of this section.
(c) No policy or contract shall be delivered or issued for delivery in this State which does not meet the prescribed minimum
standards for the categories of coverage listed in paragraphs (1)-(8) of subsection (a) of this section, or which does not
meet the other applicable requirements for such coverages as prescribed by this title.
(d) The Commissioner shall prescribe the method of identification of policies and contracts based upon coverages provided.
64 Del. Laws, c. 142, § 1.;
§ 3605. Disclosure requirements.
(a) In order to provide for full and fair disclosure in the sale of individual health insurance policies or subscriber contracts
of a health service corporation, no such policy or contract shall be delivered or issued for delivery in this State unless
the outline of coverage described in subsection (b) of this section either accompanies the policy or is delivered to the applicant
at the time the application is made and an acknowledgement of receipt or certificate of delivery of such outlines is provided
the insurer. In the event the policy is issued on a basis other than that applied for, the outline of coverage properly describing
the policy or contract must accompany the policy or contract when it is not the policy or contract for which application was
made.
(b) The Commissioner shall prescribe by regulation the format and content of the outline of coverage required by subsection
(a) of this section. "Format" means style, arrangement and overall appearance, including such items as the size, color and
prominence of type and the arrangement of text and captions. Such outline of coverage shall include:
(1) A statement identifying the applicable category or categories of coverage provided by the policy or contract as prescribed
in § 3604 of this title;
(2) A description of the principal benefits and coverage provided in the policy or contract;
(3) A statement of the exceptions, reductions and limitations contained in the policy or contract;
(4) A statement of the renewal provisions including any reservation by the insurer or health service corporation of a right
to change premiums;
(5) A statement that the outline is a summary of the policy or contract issued or applied for and that the policy or contract
should be consulted to determine governing contractual provisions.
(c) The outline of coverage shall not be considered to be part of the policy or subscriber contract for insurance.
(d) Every insurer or health service corporation electing to refuse coverage of an applicant or decline coverage of an insured
who is not included within the coverage of Chapter 23 of Title 19 shall disclose to such applicant or insured in writing the
fact of such noncoverage or declination of coverage. Any insurer or health insurer failing to disclose in writing such noncoverage
or declination of coverage shall be deemed to cover the applicant or insured under the health insurance policy then in effect.
64 Del. Laws, c. 142, § 1; 64 Del. Laws, c. 378, § 1.;
§ 3606. Preexisting conditions.
(a) Notwithstanding § 3306 of this title, if an insurer or a health service corporation elects to use a simplified application
form, with or without a question as to the applicant's health at the time of application, but without any questions concerning
the insurer's health history or medical treatment history, the policy must cover any loss occurring after 12 months from any
preexisting condition not specifically excluded from coverage by terms of the policy, and, except as so provided, the policy
or contract shall not include wording that would permit a defense based upon preexisting conditions.
(b) Notwithstanding subsection (a) of this section and § 3306 of this title, an insurer or a health service corporation which
issues a specified disease policy, regardless of whether such policy is issued on the basis of a detailed application form,
a simplified application form or an enrollment form, may not deny a claim for any covered loss that begins after the policy
has been in force for at least 6 months, unless such loss results from a preexisting condition which first manifests itself
within 6 months prior to the effective date of the policy or contract or was diagnosed by a physician at any time prior to
such date. Except for rescission for misrepresentation, no other defenses based upon preexisting conditions are permitted.
64 Del. Laws, c. 142, § 1.;
§ 3607. Limited guaranteed issue.
(a) Every carrier offering individual health benefit plans in Delaware shall offer and accept for enrollment, pursuant to
subsection (b) of this section, every federally eligible individual who applies for coverage within 63 days after termination
of such individual's prior coverage, except that this requirement shall not apply to carriers offering coverage only through
bona fide associations or to carriers offering individual coverage only through conversion policies.
(b) A carrier shall meet the requirements of subsection (a) of this section if:
(1) The carrier offers at least 2 different health benefit policy forms, both of which are designed for, are made generally
available and actively marketed to and enroll both federally eligible and other individuals; and
(2) The offering of policy forms includes, at a minimum:
a. The policy forms for health benefit plan coverage with the largest and next to largest premium volume of all such policy
forms offered by the carrier in Delaware; or
b. A lower-level coverage policy form and a higher-level coverage policy form which include benefits substantially similar
to other individual health insurance coverage offered by the carrier in Delaware and are covered under a risk adjustment,
risk spreading or financial subsidization method. As used in this subparagraph:
1. "Higher-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
15 percent greater than the actuarial value of lower-level coverage offered by the carrier in Delaware and the actuarial value
of the benefits under the coverage is at least 100 percent but not greater than 120 percent of the policy form weighted average.
2. "Lower-level coverage" means a policy form for which the actuarial value of the benefits under the coverage is at least
85 percent but not greater than 100 percent of the policy form weighted average.
3. "Policy form weighted average" means the average actuarial value of the benefits provided by all the health insurance coverage
issued (as elected by the carrier) either by that carrier or, if such data are available, by all carriers in Delaware in the
individual health benefit plan market during the previous year (not including coverage issued under this section) weighted
by enrollment for the different coverage.
c. Preexisting condition limitations shall not be applied to federally eligible individuals for coverage provided pursuant
to this section.
(c) With respect to the provisions of subsection (b) of this section, a carrier that offers coverage in the individual market
through a network plan may limit the individuals who may be enrolled to those that live, reside or work within the service
area of the plan. Such a carrier may deny coverage to eligible individuals if it demonstrates to the Commissioner that it
will not have the capacity to deliver services adequately to additional enrollees and it is applying this subsection uniformly
to individuals without regard to any health status-related factor of such individuals and without regard to whether the individuals
are eligible individuals.
(d) A carrier may apply to the Commissioner to suspend, for a period of time, its duty to issue coverage pursuant to subsection
(b) of this section where continued compliance would adversely affect the financial condition of the company. Where such a
suspension is granted, the carrier may not offer coverage in the individual market for a period of at least 180 days after
the suspension is granted.
(e) For the purposes of this section, the term "health benefit plan" as defined in § 3602(10) of this title does not include
nonrenewable short-term individual health benefit plans with a duration of 6 months or less.
71 Del. Laws, c. 143, § 3; 72 Del. Laws, c. 383, § 3.;
§ 3608. Renewability of coverage.
(a) An individual health benefit plan shall be renewable with respect to an enrollee or dependents at the option of the enrollee,
except in any of the following cases:
(1) The individual has failed to pay premiums or contributions in accordance with the terms of the health benefit plan or
the health carrier has not received timely premium payments;
(2) The individual has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material
fact under the terms of the coverage;
(3) A decision by the individual carrier to discontinue offering a particular type of health benefit plan in the state's individual
insurance market. A type of health benefit plan may be discontinued by the carrier in the individual market only if the carrier:
a. Provides notice of the decision not to renew coverage to all affected individuals and to the Commissioner in each state
in which an affected insured individual is known to reside at least 90 days prior to the nonrenewal of any health benefit
plans by the carrier. Notice to the Commissioner under this subparagraph shall be provided at least 3 working days prior to
the notice to the affected individuals;
b. Offers to each individual provided the particular type of health benefit plan the option to purchase all other health benefit
plans currently being offered by the carrier to individuals in the state; and
c. In exercising the option to discontinue the particular type of health benefit plan and, in offering the option of coverage
under paragraph (3) of this subsection, the carrier acts uniformly without regard to the claims experience of any affected
individual or any health status-related factor relating to any covered individuals or beneficiaries who may become eligible
for the coverage;
(4) The carrier elects to discontinue offering and to nonrenew all its individual health benefit plans delivered or issued
for delivery in the state. In that case, the carrier shall provide notice of its decision not to renew coverage to all enrollees
and to the Commissioner in each state in which an enrollee is known to reside at least 180 days prior to the nonrenewal of
the health benefit plan by the carrier. Notice to the Commissioner under this paragraph shall be provided at least 3 working
days prior to the notice of the enrollees;
(5) The Commissioner finds that the continuation of the coverage would not be in the best interests of the enrollees, the
plan is obsolete or would impair the carrier's ability to meet its contractual obligations. Once the Commissioner has made
such a finding, the carrier shall provide notice to each affected covered individual provided coverage of this type of such
discontinuation and shall provide each affected covered individual the opportunity to purchase any other individual health
insurance coverage being offered by the carrier. In exercising this option, the carrier shall act uniformly without regard
for any health status-related factor of enrolled individuals or individuals who may become eligible for such coverage;
(6) The Commissioner finds that the product form is being uniformly modified and is being replaced with comparable coverage.
(b) An individual carrier that elects not to renew all its health benefit plans under subsection (a)(4) of this section shall
be prohibited from writing new business in the individual market in this State for a period of 5 years from the date of the
discontinuation of the last health benefit plan not so renewed.
(c) In the case of an individual carrier doing business in 1 established geographic service area of the state, the rules set
forth in this section shall apply only to the carrier's operations in that service area.
(d) An individual carrier offering coverage through a network plan shall not be required to renew, offer coverage or accept
applications pursuant to subsection (a) of this section to an eligible person who no longer resides, lives or works in the
service area or in an area for which the carrier is not authorized to do business, but only if coverage is terminated under
this paragraph uniformly without regard to any health status-related factor of covered individuals.
(e) In applying this section in the case of a health benefit plan that is made available in the individual market to individuals
only through 1 or more bona fide associations, a reference to an "individual" is deemed to include a reference to such an
association (of which the individual is a member).
