Converted policy to be offered on termination of group healthcoverage, when--exceptions--terms and conditions.
376.397. 1. A group policy delivered or issued for delivery in thisstate which insures employees or members for hospital, surgical or majormedical insurance on an expense incurred or service basis, other than forspecific diseases or for accidental injuries only, shall provide that anemployee or member whose insurance under the group policy has been terminatedshall be entitled to have a converted policy issued to him by the insurerunder whose group policy he was insured, without evidence of insurability,subject to the following terms and conditions:
(1) A converted policy need not be made available to an employee ormember if termination of his insurance under the group policy occurred:
(a) Because he failed to make timely payment of any requiredcontribution; or
(b) For any other reason, and he had not been continuously covered underthe group policy, and for similar benefits under any group policy which itreplaced, during the entire three months' period ending with such termination;or
(c) Because the group policy terminated or an employer's participationterminated, and the insurance is replaced by similar coverage under anothergroup policy within thirty-one days of the date of termination;
(2) Written application and the first premium payment for the convertedpolicy shall be made to the insurer not later than thirty-one days after suchtermination;
(3) The premium for the converted policy shall be determined inaccordance with the insurer's table of premium rates applicable to the age andclass of risk of each person to be covered under that policy and to the typeand amount of insurance provided;
(4) The converted policy shall cover the employee or member and hisdependents who were covered by the group policy on the date of termination ofinsurance. At the option of the insurer, a separate converted policy may beissued to cover any dependent;
(5) The insurer shall not be required to issue a converted policycovering any person if such person is or could be covered by Medicare.Furthermore, the insurer shall not be required to issue a converted policycovering any person if:
(a) Such person is or could be covered for similar benefits by anotherindividual policy; such person is or could be covered for similar benefitsunder any arrangement of coverage for individuals in a group, whether insuredor uninsured; or similar benefits are provided for or available to suchperson, by reason of any state or federal law; and
(b) The benefits under sources of the kind referred to in paragraph (a)above for such person, or benefits provided or available under sources of thekind referred to in paragraph (a) above for such person, together with theconverted policy's benefits would result in overinsurance according to theinsurer's standards for overinsurance;
(6) A converted policy may provide that the insurer may at any timerequest information of any person covered thereunder as to whether he iscovered for the similar benefits described in paragraph (a) of subdivision (5)above or is or could be covered for the similar benefits described inparagraph (a) of subdivision (5) above. The converted policy may provide thatas of any premium due date the insurer may refuse to renew the policy or thecoverage of any insured person for the following reasons only:
(a) Either those similar benefits for which such person is or could becovered, together with the converted policy's benefits, would result inoverinsurance according to the insurer's standards for overinsurance, or thepolicyholder of the converted policy fails to provide the requestedinformation;
(b) Fraud or material misrepresentation in applying for any benefitsunder the converted policy;
(c) Eligibility of the insured person for coverage under Medicare orunder any other state or federal law providing for benefits similar to thoseprovided by the converted policy;
(d) Other reasons approved by the director of the department ofinsurance, financial institutions and professional registration;
(7) An insurer shall not be required to issue a converted policyproviding benefits in excess of the hospital, surgical or major medicalinsurance under the group policy from which conversion is made;
(8) The converted policy shall not exclude, as a preexisting condition,any condition covered by the group policy; provided, however, that theconverted policy may provide for a reduction of its hospital, surgical ormedical benefits by the amount of any such benefits payable under the grouppolicy after the individual's insurance terminates thereunder. The convertedpolicy may also provide that during the first policy year the benefits payableunder the converted policy, together with the benefits payable under the grouppolicy, shall not exceed those that would have been payable had theindividual's insurance under the group policy remained in force and effect;
(9) Subject to the provisions and conditions of sections 376.395 to376.404, if the group insurance policy from which conversion is made insuresthe employee or member for basic hospital or surgical expense insurance, theemployee or member shall be entitled to obtain a converted policy providing,at his option, coverage on an expense incurred basis under any of thefollowing plans:
(a) Plan A, which shall include:
a. Hospital room and board daily expense benefits in a maximum dollaramount approximating the average semiprivate rate charged in the largest majormetropolitan area of this state, for a maximum duration of seventy days;
b. Miscellaneous hospital expense benefits up to a maximum amount of tentimes the hospital room and board daily expense benefits; and
c. Surgical expense benefits according to a surgical procedures scheduleconsistent with those customarily offered by the insurer under group orindividual health insurance policies and providing a maximum benefit of eighthundred dollars;
(b) Plan B, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is seventy-five percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is six hundred dollars;
(c) Plan C, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is fifty percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is four hundred dollars. The maximum dollar amount for planA's maximum hospital room and board daily expense benefit shall be determinedby the director of the department of insurance, financial institutions andprofessional registration and may be redetermined by him from time to time asto converted policies issued subsequent to such redetermination. Suchredetermination shall not be made more often than once every three years.Such plan A maximum, and the corresponding maximums in plans B and C, shall berounded to the nearest ten dollar multiple; provided that, rounding may be tothe next higher or lower multiple of ten dollars if otherwise exactly midwaybetween two multiples;
(10) Subject to the provisions and conditions of sections 376.395 to376.404, if the group policy from which conversion is made insures theemployee or member for major medical expense insurance, the employee or membershall be entitled to obtain a converted policy providing catastrophic or majormedical coverage under a plan meeting the following requirements:
(a) A maximum benefit at least equal to, at the option of the insurer,either:
a. A maximum payment per covered person for all covered medical expensesincurred during that person's lifetime, equal to the smaller of the maximumbenefit provided under the group policy or two hundred fifty thousand dollars;
b. A maximum payment for each unrelated injury or sickness, equal to thesmaller of the maximum benefit provided under the group policy or two hundredfifty thousand dollars;
(b) Payment of benefits at the rate of eighty percent of covered medicalexpenses which are in excess of the deductible, until twenty percent of suchexpenses in a benefit period reaches one thousand dollars, after whichbenefits will be paid at the rate of one hundred percent during the remainderof such benefit period. Payment of benefits for outpatient treatment ofmental illness, if provided in the converted policy, may be at a lesser rate,but not less than fifty percent;
(c) A deductible for each benefit period which, at the option of theinsurer, shall be the sum of the benefits deductible plus one hundred dollars,or the corresponding deductible in the group policy. The term "benefitsdeductible", as used herein, means the value of any benefits provided on anexpense incurred basis which are provided with respect to covered medicalexpenses by any other group or individual hospital, surgical or medicalinsurance policy or medical practice or other prepayment plan, or any otherplan or program, whether insured or uninsured, or by reason of any state orfederal law and if, pursuant to subdivision (11) herein, the converted policyprovides both basic hospital or surgical coverage and major medical coverage,the value of such basic benefits. If the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision, the insurer may requirethat the deductible be satisfied during a period of not less than three monthsif the deductible is one hundred dollars or less, and not less than six monthsif the deductible exceeds one hundred dollars;
(d) The benefit period shall be each calendar year when the maximumbenefit is determined under subparagraph a. of paragraph (a) of thissubdivision or twenty-four months when the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision;
(e) The term "covered medical expenses", as used in this subdivision,shall include at least, in the case of hospital room and board charges, thelesser of the dollar amount set out in plan A under subdivision (9) and theaverage semiprivate room and board rate for the hospital in which theindividual is confined, and at least twice such amount for charges in anintensive care unit. Any surgical procedures schedule shall be consistentwith those customarily offered by the insurer under group or individual healthinsurance policies and must provide at least a one thousand two hundred dollarmaximum benefit;
(11) At the option of the insurer, benefit plans set forth insubdivisions (9) and (10) of this section may be provided under one policy or,in lieu of the benefit plans set forth in subdivisions (9) and (10) of thissection, the insurer may provide a policy for comprehensive medical expensebenefits without first dollar coverage. Such policy shall conform to therequirements of subdivision (10) of this section; provided, however, that aninsurer electing to provide such a policy shall make available a lowdeductible option, not to exceed one hundred dollars, a high deductible optionbetween five hundred dollars and one thousand dollars, and a third deductibleoption midway between the high and low deductible options. Alternatively,such a policy may provide for deductible options equal to the greater of thebenefits deductible and the amount specified in the preceding sentence.
2. (1) The insurer may, at its option, offer alternative plans forconverted policies from group policies in addition to those required bysections 376.395 to 376.404. Furthermore, if any insurer customarily offersindividual policies on a service basis, that insurer may, in lieu of convertedpolicies on an expense incurred basis, make available converted policies on aservice basis which, in the opinion of the director of the department ofinsurance, financial institutions and professional registration, satisfy theintent of sections 376.395 to 376.404.
(2) Nothing in sections 376.395 to 376.404 shall preclude a healthservice corporation from limiting its conversion offerings to one of the plansoffered by the insurer that is consistent with group policies customarilyoffered by the health service corporation. The employee or member under thegroup insurance policy from which conversion is made shall be entitled toobtain one such converted policy.
3. Notification of the conversion privilege shall be included in eachcertificate of coverage.
4. All converted policies shall become effective on the day immediatelyfollowing the date of termination of insurance under a group policy.
Converted policy to be offered on termination of group healthcoverage, when--exceptions--terms and conditions.
376.397. 1. A group policy delivered or issued for delivery in thisstate which insures employees or members for hospital, surgical or majormedical insurance on an expense incurred or service basis, other than forspecific diseases or for accidental injuries only, shall provide that anemployee or member whose insurance under the group policy has been terminatedshall be entitled to have a converted policy issued to him by the insurerunder whose group policy he was insured, without evidence of insurability,subject to the following terms and conditions:
(1) A converted policy need not be made available to an employee ormember if termination of his insurance under the group policy occurred:
(a) Because he failed to make timely payment of any requiredcontribution; or
(b) For any other reason, and he had not been continuously covered underthe group policy, and for similar benefits under any group policy which itreplaced, during the entire three months' period ending with such termination;or
(c) Because the group policy terminated or an employer's participationterminated, and the insurance is replaced by similar coverage under anothergroup policy within thirty-one days of the date of termination;
(2) Written application and the first premium payment for the convertedpolicy shall be made to the insurer not later than thirty-one days after suchtermination;
(3) The premium for the converted policy shall be determined inaccordance with the insurer's table of premium rates applicable to the age andclass of risk of each person to be covered under that policy and to the typeand amount of insurance provided;
(4) The converted policy shall cover the employee or member and hisdependents who were covered by the group policy on the date of termination ofinsurance. At the option of the insurer, a separate converted policy may beissued to cover any dependent;
(5) The insurer shall not be required to issue a converted policycovering any person if such person is or could be covered by Medicare.Furthermore, the insurer shall not be required to issue a converted policycovering any person if:
(a) Such person is or could be covered for similar benefits by anotherindividual policy; such person is or could be covered for similar benefitsunder any arrangement of coverage for individuals in a group, whether insuredor uninsured; or similar benefits are provided for or available to suchperson, by reason of any state or federal law; and
(b) The benefits under sources of the kind referred to in paragraph (a)above for such person, or benefits provided or available under sources of thekind referred to in paragraph (a) above for such person, together with theconverted policy's benefits would result in overinsurance according to theinsurer's standards for overinsurance;
(6) A converted policy may provide that the insurer may at any timerequest information of any person covered thereunder as to whether he iscovered for the similar benefits described in paragraph (a) of subdivision (5)above or is or could be covered for the similar benefits described inparagraph (a) of subdivision (5) above. The converted policy may provide thatas of any premium due date the insurer may refuse to renew the policy or thecoverage of any insured person for the following reasons only:
(a) Either those similar benefits for which such person is or could becovered, together with the converted policy's benefits, would result inoverinsurance according to the insurer's standards for overinsurance, or thepolicyholder of the converted policy fails to provide the requestedinformation;
(b) Fraud or material misrepresentation in applying for any benefitsunder the converted policy;
(c) Eligibility of the insured person for coverage under Medicare orunder any other state or federal law providing for benefits similar to thoseprovided by the converted policy;
(d) Other reasons approved by the director of the department ofinsurance, financial institutions and professional registration;
(7) An insurer shall not be required to issue a converted policyproviding benefits in excess of the hospital, surgical or major medicalinsurance under the group policy from which conversion is made;
(8) The converted policy shall not exclude, as a preexisting condition,any condition covered by the group policy; provided, however, that theconverted policy may provide for a reduction of its hospital, surgical ormedical benefits by the amount of any such benefits payable under the grouppolicy after the individual's insurance terminates thereunder. The convertedpolicy may also provide that during the first policy year the benefits payableunder the converted policy, together with the benefits payable under the grouppolicy, shall not exceed those that would have been payable had theindividual's insurance under the group policy remained in force and effect;
(9) Subject to the provisions and conditions of sections 376.395 to376.404, if the group insurance policy from which conversion is made insuresthe employee or member for basic hospital or surgical expense insurance, theemployee or member shall be entitled to obtain a converted policy providing,at his option, coverage on an expense incurred basis under any of thefollowing plans:
(a) Plan A, which shall include:
a. Hospital room and board daily expense benefits in a maximum dollaramount approximating the average semiprivate rate charged in the largest majormetropolitan area of this state, for a maximum duration of seventy days;
b. Miscellaneous hospital expense benefits up to a maximum amount of tentimes the hospital room and board daily expense benefits; and
c. Surgical expense benefits according to a surgical procedures scheduleconsistent with those customarily offered by the insurer under group orindividual health insurance policies and providing a maximum benefit of eighthundred dollars;
(b) Plan B, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is seventy-five percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is six hundred dollars;
(c) Plan C, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is fifty percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is four hundred dollars. The maximum dollar amount for planA's maximum hospital room and board daily expense benefit shall be determinedby the director of the department of insurance, financial institutions andprofessional registration and may be redetermined by him from time to time asto converted policies issued subsequent to such redetermination. Suchredetermination shall not be made more often than once every three years.Such plan A maximum, and the corresponding maximums in plans B and C, shall berounded to the nearest ten dollar multiple; provided that, rounding may be tothe next higher or lower multiple of ten dollars if otherwise exactly midwaybetween two multiples;
(10) Subject to the provisions and conditions of sections 376.395 to376.404, if the group policy from which conversion is made insures theemployee or member for major medical expense insurance, the employee or membershall be entitled to obtain a converted policy providing catastrophic or majormedical coverage under a plan meeting the following requirements:
(a) A maximum benefit at least equal to, at the option of the insurer,either:
a. A maximum payment per covered person for all covered medical expensesincurred during that person's lifetime, equal to the smaller of the maximumbenefit provided under the group policy or two hundred fifty thousand dollars;
b. A maximum payment for each unrelated injury or sickness, equal to thesmaller of the maximum benefit provided under the group policy or two hundredfifty thousand dollars;
(b) Payment of benefits at the rate of eighty percent of covered medicalexpenses which are in excess of the deductible, until twenty percent of suchexpenses in a benefit period reaches one thousand dollars, after whichbenefits will be paid at the rate of one hundred percent during the remainderof such benefit period. Payment of benefits for outpatient treatment ofmental illness, if provided in the converted policy, may be at a lesser rate,but not less than fifty percent;
(c) A deductible for each benefit period which, at the option of theinsurer, shall be the sum of the benefits deductible plus one hundred dollars,or the corresponding deductible in the group policy. The term "benefitsdeductible", as used herein, means the value of any benefits provided on anexpense incurred basis which are provided with respect to covered medicalexpenses by any other group or individual hospital, surgical or medicalinsurance policy or medical practice or other prepayment plan, or any otherplan or program, whether insured or uninsured, or by reason of any state orfederal law and if, pursuant to subdivision (11) herein, the converted policyprovides both basic hospital or surgical coverage and major medical coverage,the value of such basic benefits. If the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision, the insurer may requirethat the deductible be satisfied during a period of not less than three monthsif the deductible is one hundred dollars or less, and not less than six monthsif the deductible exceeds one hundred dollars;
(d) The benefit period shall be each calendar year when the maximumbenefit is determined under subparagraph a. of paragraph (a) of thissubdivision or twenty-four months when the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision;
(e) The term "covered medical expenses", as used in this subdivision,shall include at least, in the case of hospital room and board charges, thelesser of the dollar amount set out in plan A under subdivision (9) and theaverage semiprivate room and board rate for the hospital in which theindividual is confined, and at least twice such amount for charges in anintensive care unit. Any surgical procedures schedule shall be consistentwith those customarily offered by the insurer under group or individual healthinsurance policies and must provide at least a one thousand two hundred dollarmaximum benefit;
(11) At the option of the insurer, benefit plans set forth insubdivisions (9) and (10) of this section may be provided under one policy or,in lieu of the benefit plans set forth in subdivisions (9) and (10) of thissection, the insurer may provide a policy for comprehensive medical expensebenefits without first dollar coverage. Such policy shall conform to therequirements of subdivision (10) of this section; provided, however, that aninsurer electing to provide such a policy shall make available a lowdeductible option, not to exceed one hundred dollars, a high deductible optionbetween five hundred dollars and one thousand dollars, and a third deductibleoption midway between the high and low deductible options. Alternatively,such a policy may provide for deductible options equal to the greater of thebenefits deductible and the amount specified in the preceding sentence.
2. (1) The insurer may, at its option, offer alternative plans forconverted policies from group policies in addition to those required bysections 376.395 to 376.404. Furthermore, if any insurer customarily offersindividual policies on a service basis, that insurer may, in lieu of convertedpolicies on an expense incurred basis, make available converted policies on aservice basis which, in the opinion of the director of the department ofinsurance, financial institutions and professional registration, satisfy theintent of sections 376.395 to 376.404.
(2) Nothing in sections 376.395 to 376.404 shall preclude a healthservice corporation from limiting its conversion offerings to one of the plansoffered by the insurer that is consistent with group policies customarilyoffered by the health service corporation. The employee or member under thegroup insurance policy from which conversion is made shall be entitled toobtain one such converted policy.
3. Notification of the conversion privilege shall be included in eachcertificate of coverage.
4. All converted policies shall become effective on the day immediatelyfollowing the date of termination of insurance under a group policy.
Converted policy to be offered on termination of group healthcoverage, when--exceptions--terms and conditions.
376.397. 1. A group policy delivered or issued for delivery in thisstate which insures employees or members for hospital, surgical or majormedical insurance on an expense incurred or service basis, other than forspecific diseases or for accidental injuries only, shall provide that anemployee or member whose insurance under the group policy has been terminatedshall be entitled to have a converted policy issued to him by the insurerunder whose group policy he was insured, without evidence of insurability,subject to the following terms and conditions:
(1) A converted policy need not be made available to an employee ormember if termination of his insurance under the group policy occurred:
(a) Because he failed to make timely payment of any requiredcontribution; or
(b) For any other reason, and he had not been continuously covered underthe group policy, and for similar benefits under any group policy which itreplaced, during the entire three months' period ending with such termination;or
(c) Because the group policy terminated or an employer's participationterminated, and the insurance is replaced by similar coverage under anothergroup policy within thirty-one days of the date of termination;
(2) Written application and the first premium payment for the convertedpolicy shall be made to the insurer not later than thirty-one days after suchtermination;
(3) The premium for the converted policy shall be determined inaccordance with the insurer's table of premium rates applicable to the age andclass of risk of each person to be covered under that policy and to the typeand amount of insurance provided;
(4) The converted policy shall cover the employee or member and hisdependents who were covered by the group policy on the date of termination ofinsurance. At the option of the insurer, a separate converted policy may beissued to cover any dependent;
(5) The insurer shall not be required to issue a converted policycovering any person if such person is or could be covered by Medicare.Furthermore, the insurer shall not be required to issue a converted policycovering any person if:
(a) Such person is or could be covered for similar benefits by anotherindividual policy; such person is or could be covered for similar benefitsunder any arrangement of coverage for individuals in a group, whether insuredor uninsured; or similar benefits are provided for or available to suchperson, by reason of any state or federal law; and
(b) The benefits under sources of the kind referred to in paragraph (a)above for such person, or benefits provided or available under sources of thekind referred to in paragraph (a) above for such person, together with theconverted policy's benefits would result in overinsurance according to theinsurer's standards for overinsurance;
(6) A converted policy may provide that the insurer may at any timerequest information of any person covered thereunder as to whether he iscovered for the similar benefits described in paragraph (a) of subdivision (5)above or is or could be covered for the similar benefits described inparagraph (a) of subdivision (5) above. The converted policy may provide thatas of any premium due date the insurer may refuse to renew the policy or thecoverage of any insured person for the following reasons only:
(a) Either those similar benefits for which such person is or could becovered, together with the converted policy's benefits, would result inoverinsurance according to the insurer's standards for overinsurance, or thepolicyholder of the converted policy fails to provide the requestedinformation;
(b) Fraud or material misrepresentation in applying for any benefitsunder the converted policy;
(c) Eligibility of the insured person for coverage under Medicare orunder any other state or federal law providing for benefits similar to thoseprovided by the converted policy;
(d) Other reasons approved by the director of the department ofinsurance, financial institutions and professional registration;
(7) An insurer shall not be required to issue a converted policyproviding benefits in excess of the hospital, surgical or major medicalinsurance under the group policy from which conversion is made;
(8) The converted policy shall not exclude, as a preexisting condition,any condition covered by the group policy; provided, however, that theconverted policy may provide for a reduction of its hospital, surgical ormedical benefits by the amount of any such benefits payable under the grouppolicy after the individual's insurance terminates thereunder. The convertedpolicy may also provide that during the first policy year the benefits payableunder the converted policy, together with the benefits payable under the grouppolicy, shall not exceed those that would have been payable had theindividual's insurance under the group policy remained in force and effect;
(9) Subject to the provisions and conditions of sections 376.395 to376.404, if the group insurance policy from which conversion is made insuresthe employee or member for basic hospital or surgical expense insurance, theemployee or member shall be entitled to obtain a converted policy providing,at his option, coverage on an expense incurred basis under any of thefollowing plans:
(a) Plan A, which shall include:
a. Hospital room and board daily expense benefits in a maximum dollaramount approximating the average semiprivate rate charged in the largest majormetropolitan area of this state, for a maximum duration of seventy days;
b. Miscellaneous hospital expense benefits up to a maximum amount of tentimes the hospital room and board daily expense benefits; and
c. Surgical expense benefits according to a surgical procedures scheduleconsistent with those customarily offered by the insurer under group orindividual health insurance policies and providing a maximum benefit of eighthundred dollars;
(b) Plan B, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is seventy-five percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is six hundred dollars;
(c) Plan C, which shall be the same as plan A, except that the maximumhospital room and board daily expense benefit is fifty percent of thecorresponding maximum under subparagraph a of plan A, and the surgicalschedule maximum is four hundred dollars. The maximum dollar amount for planA's maximum hospital room and board daily expense benefit shall be determinedby the director of the department of insurance, financial institutions andprofessional registration and may be redetermined by him from time to time asto converted policies issued subsequent to such redetermination. Suchredetermination shall not be made more often than once every three years.Such plan A maximum, and the corresponding maximums in plans B and C, shall berounded to the nearest ten dollar multiple; provided that, rounding may be tothe next higher or lower multiple of ten dollars if otherwise exactly midwaybetween two multiples;
(10) Subject to the provisions and conditions of sections 376.395 to376.404, if the group policy from which conversion is made insures theemployee or member for major medical expense insurance, the employee or membershall be entitled to obtain a converted policy providing catastrophic or majormedical coverage under a plan meeting the following requirements:
(a) A maximum benefit at least equal to, at the option of the insurer,either:
a. A maximum payment per covered person for all covered medical expensesincurred during that person's lifetime, equal to the smaller of the maximumbenefit provided under the group policy or two hundred fifty thousand dollars;
b. A maximum payment for each unrelated injury or sickness, equal to thesmaller of the maximum benefit provided under the group policy or two hundredfifty thousand dollars;
(b) Payment of benefits at the rate of eighty percent of covered medicalexpenses which are in excess of the deductible, until twenty percent of suchexpenses in a benefit period reaches one thousand dollars, after whichbenefits will be paid at the rate of one hundred percent during the remainderof such benefit period. Payment of benefits for outpatient treatment ofmental illness, if provided in the converted policy, may be at a lesser rate,but not less than fifty percent;
(c) A deductible for each benefit period which, at the option of theinsurer, shall be the sum of the benefits deductible plus one hundred dollars,or the corresponding deductible in the group policy. The term "benefitsdeductible", as used herein, means the value of any benefits provided on anexpense incurred basis which are provided with respect to covered medicalexpenses by any other group or individual hospital, surgical or medicalinsurance policy or medical practice or other prepayment plan, or any otherplan or program, whether insured or uninsured, or by reason of any state orfederal law and if, pursuant to subdivision (11) herein, the converted policyprovides both basic hospital or surgical coverage and major medical coverage,the value of such basic benefits. If the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision, the insurer may requirethat the deductible be satisfied during a period of not less than three monthsif the deductible is one hundred dollars or less, and not less than six monthsif the deductible exceeds one hundred dollars;
(d) The benefit period shall be each calendar year when the maximumbenefit is determined under subparagraph a. of paragraph (a) of thissubdivision or twenty-four months when the maximum benefit is determined undersubparagraph b. of paragraph (a) of this subdivision;
(e) The term "covered medical expenses", as used in this subdivision,shall include at least, in the case of hospital room and board charges, thelesser of the dollar amount set out in plan A under subdivision (9) and theaverage semiprivate room and board rate for the hospital in which theindividual is confined, and at least twice such amount for charges in anintensive care unit. Any surgical procedures schedule shall be consistentwith those customarily offered by the insurer under group or individual healthinsurance policies and must provide at least a one thousand two hundred dollarmaximum benefit;
(11) At the option of the insurer, benefit plans set forth insubdivisions (9) and (10) of this section may be provided under one policy or,in lieu of the benefit plans set forth in subdivisions (9) and (10) of thissection, the insurer may provide a policy for comprehensive medical expensebenefits without first dollar coverage. Such policy shall conform to therequirements of subdivision (10) of this section; provided, however, that aninsurer electing to provide such a policy shall make available a lowdeductible option, not to exceed one hundred dollars, a high deductible optionbetween five hundred dollars and one thousand dollars, and a third deductibleoption midway between the high and low deductible options. Alternatively,such a policy may provide for deductible options equal to the greater of thebenefits deductible and the amount specified in the preceding sentence.
2. (1) The insurer may, at its option, offer alternative plans forconverted policies from group policies in addition to those required bysections 376.395 to 376.404. Furthermore, if any insurer customarily offersindividual policies on a service basis, that insurer may, in lieu of convertedpolicies on an expense incurred basis, make available converted policies on aservice basis which, in the opinion of the director of the department ofinsurance, financial institutions and professional registration, satisfy theintent of sections 376.395 to 376.404.
(2) Nothing in sections 376.395 to 376.404 shall preclude a healthservice corporation from limiting its conversion offerings to one of the plansoffered by the insurer that is consistent with group policies customarilyoffered by the health service corporation. The employee or member under thegroup insurance policy from which conversion is made shall be entitled toobtain one such converted policy.
3. Notification of the conversion privilege shall be included in eachcertificate of coverage.
4. All converted policies shall become effective on the day immediatelyfollowing the date of termination of insurance under a group policy.
