[§431:10H-205]  Continuation or conversion. (a)  Group long-term care insurance issued in this State beginning July 1,2000, shall provide covered individuals with a basis for continuation orconversion of coverage.

(b)  For purposes of this section, "abasis for continuation of coverage" means a policy provision thatmaintains coverage under the existing group policy when the coverage wouldotherwise terminate and which is subject only to the continued timely paymentof premium when due.  Group policies that restrict provision of benefits andservices to, or contain incentives to use certain providers or facilities mayprovide continuation benefits that are substantially equivalent to the benefitsof the existing group policy.  The commissioner shall make a determination asto the substantial equivalency of benefits, and in doing so, shall take intoconsideration the differences between managed care and non-managed care plans,including but not limited to, provider system arrangements, service availability,benefit levels, and administrative complexity.

(c)  For purposes of this section, "abasis for conversion of coverage" means a policy provision that entitlesan individual, whose coverage under the group policy would otherwise terminateor has been terminated for any reason including discontinuance of the grouppolicy in its entirety or with respect to an insured class, and who has beencontinuously insured under the group policy or any group policy that itreplaced for at least six months immediately prior to termination shall beentitled to the issuance of a converted policy by the insurer under whose grouppolicy the individual is covered, without evidence of insurability.

(d)  For purposes of this section,"converted policy" means an individual policy of long-term careinsurance providing benefits identical to or benefits determined by thecommissioner to be substantially equivalent to or in excess of those providedunder the group policy from which conversion is made.  Where the group policyfrom which conversion is made restricts provision of benefits and services to,or contains incentives to use certain providers or facilities, thecommissioner, in making a determination as to substantial equivalency ofbenefits, shall take into consideration the differences between managed careand non-managed care plans, including but not limited to, provider systemarrangements, service availability, benefit levels, and administrativecomplexity.

(e)  Written application for the convertedpolicy shall be made and the first premium, if any, shall be paid as directedby the insurer no later than thirty-one days after termination of coverageunder the group policy.  The converted policy shall be issued effective on theday following the termination of coverage under the group policy, and shall berenewable annually.

(f)  Unless the group policy from whichconversion is made replaced previous group policy coverage, the premium for theconverted policy shall be calculated on the basis of the insured's age atinception of coverage under the group policy from which conversion is made. Where the group policy from which conversion is made replaced a previous groupcoverage, the premium for the converted policy shall be calculated on the basisof the insured's age at inception of coverage under the group policy replaced.

(g)  Continuation of coverage or issuance of aconverted policy shall be mandatory, except where:

(1)  Termination of group coverage resulted from anindividual's failure to make any required payment of premium or contributionwhen due; or

(2)  The terminating coverage is replaced not laterthan thirty-one days after termination by another group coverage effective onthe day following the termination of coverage:

(A)  Providing benefits or benefits determinedby the commissioner to be identical substantially equivalent to or in excess ofthose provided by the terminating coverage; and

(B)  The premium for which is calculated in amanner consistent with the requirements of subsection (f).

(h)  Notwithstanding any other provision ofthis section, a converted policy issued to an individual who at the time ofconversion is covered by another long-term care insurance policy that providesbenefits on the basis of incurred expenses, may contain a provision that resultsin a reduction of benefits payable if the benefits provided under theadditional coverage, together with the full benefits provided by the convertedpolicy, would result in payment of more than one hundred per cent of incurredexpenses.  The provision shall only be included in the converted policy if theconverted policy also provides for a premium decrease or refund which reflectsthe reduction in benefits payable.

(i)  The converted policy may provide that thebenefits payable under the converted policy, together with the benefits payableunder the group policy from which conversion is made, shall not exceed thosethat would have been payable had the individual's coverage under the grouppolicy remained in force and effect.

(j)  Notwithstanding any other provision ofthis section, an insured individual whose eligibility for group long-term carecoverage is based upon the individual's relationship to another person shall beentitled to continuation of coverage under the group policy upon termination ofthe qualifying relationship by death or dissolution of marriage or reciprocalbeneficiary relationship.

(k)  For purposes of this section "managedcare plan" is a health care or assisted living arrangement designed tocoordinate patient care or control costs through utilization review, casemanagement, or use of specific provider networks. [L 1999, c 93, pt of §2]