- 14,808
Again, we try to have general discussions when states are so different. It's just impossible. I know in MD domiciled carriers absolutely must have DOI approval for any increase:
The Association Myth
- Thread starter somarco
- Start date
- Thread starter
- #32
- 14,808
So Somarco, you're saying that association plans do have to abide by the state mandates? How is the Right Start compliant with ANY of the 58 Maryland mandates? I can't think of a single mandate the Right Start covers. Copay Saver? No way.
- Thread starter
- #34
Yes John, all plans sold in the state must be approved by the DOI regardless of whether or not they are association based. I have had enough dealings with the DOI & AG's in various states to know what is kosher and what isn't. An association filing vs. individual filing is an administrative move by the carrier or marketing organization to save time & money.
Two years ago when CGI & GR refiled their new plans (one association based, the other not) it took close to a year and a wheelbarrow full of money to get approval. The CGI plan went a lot quicker as they only had to tweak some of their compliance riders.
States have 2 kind of mandates.
One is a universal mandate that all carriers must include in their policies. An example (in GA) is complications of maternity. All carriers are required to include complications even if they do not offer a maternity benefit. Those same carriers are permitted to exclude complications by rider if the applicant has had a prior complicated delivery.
One of the first policies I wrote after deciding to switch from large group to individual policies was an HSA on a lady who had a prior complicated delivery. The carrier did in fact exclude coverage for complications when the policy was issued.
The carrier?
Fortis.
The other kind of mandate is one where carriers must comply IF their policy includes certain benefits. Since we are on a roll here with maternity, in GA if a carrier includes a maternity benefit they are required to cover a 2 day stay for normal delivery and 3 day minimum for a C-section. This does not mean that every carrier must offer maternity, but those that do must include these benefits.
World issues via an association and they offer a very overpriced maternity benefit. Guess what? It is in compliance.
About a year & half ago I was contacted by a marketing organization out of NY regarding a guaranteed issue indemnity plan that was HIPAA compliant . . . at least that was their pitch. There are plenty of gtd issue plans around but none are HIPAA compliant so this intrigued me as a way to offer affordable (compared to HIPAA conversion) plans to folks who would otherwise lose their rights while in between jobs. After numerous requests I finally got a specimen policy & app. The plan was going to be issued via an association based in NY.
I sent the info to one of my contacts in the DOI and he was very interested. The app had never been filed in GA and would not be considered as compliant. The marketing material had never been filed here and also was non-compliant. The specimen policy was an Alabama document and lacked some key provisions required in GA.
And here is kicker.
Nothing in the literature or policy said a thing about HIPAA compliance. Tom also assured me the plan was not HIPAA compliant and any agent who wrote the plan as such would be in serious trouble. Of course, since the plan was completely bogus (as far as the GA DOI was concerned) agents could be fined, lose their license and face jail time even if they said nothing about the plan being HIPAA compliant.
Tom told me he was opening a file on the plan and also sending info to the AG's office for a possible joint investigation.
I have no idea what happened with the plan. Never saw much on it after that and eventually the guy in NY quit calling.
Long answer to your question.
Of course, this all applies to GA as well as several other states where I have written business in the past. MD may be the single state where the rules are completely different and carriers and agents are free to their own interpretation.
Two years ago when CGI & GR refiled their new plans (one association based, the other not) it took close to a year and a wheelbarrow full of money to get approval. The CGI plan went a lot quicker as they only had to tweak some of their compliance riders.
States have 2 kind of mandates.
One is a universal mandate that all carriers must include in their policies. An example (in GA) is complications of maternity. All carriers are required to include complications even if they do not offer a maternity benefit. Those same carriers are permitted to exclude complications by rider if the applicant has had a prior complicated delivery.
One of the first policies I wrote after deciding to switch from large group to individual policies was an HSA on a lady who had a prior complicated delivery. The carrier did in fact exclude coverage for complications when the policy was issued.
The carrier?
Fortis.
The other kind of mandate is one where carriers must comply IF their policy includes certain benefits. Since we are on a roll here with maternity, in GA if a carrier includes a maternity benefit they are required to cover a 2 day stay for normal delivery and 3 day minimum for a C-section. This does not mean that every carrier must offer maternity, but those that do must include these benefits.
World issues via an association and they offer a very overpriced maternity benefit. Guess what? It is in compliance.
About a year & half ago I was contacted by a marketing organization out of NY regarding a guaranteed issue indemnity plan that was HIPAA compliant . . . at least that was their pitch. There are plenty of gtd issue plans around but none are HIPAA compliant so this intrigued me as a way to offer affordable (compared to HIPAA conversion) plans to folks who would otherwise lose their rights while in between jobs. After numerous requests I finally got a specimen policy & app. The plan was going to be issued via an association based in NY.
I sent the info to one of my contacts in the DOI and he was very interested. The app had never been filed in GA and would not be considered as compliant. The marketing material had never been filed here and also was non-compliant. The specimen policy was an Alabama document and lacked some key provisions required in GA.
And here is kicker.
Nothing in the literature or policy said a thing about HIPAA compliance. Tom also assured me the plan was not HIPAA compliant and any agent who wrote the plan as such would be in serious trouble. Of course, since the plan was completely bogus (as far as the GA DOI was concerned) agents could be fined, lose their license and face jail time even if they said nothing about the plan being HIPAA compliant.
Tom told me he was opening a file on the plan and also sending info to the AG's office for a possible joint investigation.
I have no idea what happened with the plan. Never saw much on it after that and eventually the guy in NY quit calling.
Long answer to your question.
Of course, this all applies to GA as well as several other states where I have written business in the past. MD may be the single state where the rules are completely different and carriers and agents are free to their own interpretation.
- 14,808
I'm still honestly lost. Wellness is a Maryland mandate - child wellness within the 1st two years and adult wellness for pap, mammograms and psa testing. Max and One Deductible plans comply. Right Start and CoreMed don't. Copay Select Complies, Copay Saver doesn't. Can the insurance company pick and choose?
I know for a fact that complications of pregnancy is a Maryland mandate and also know when I was with Mega that none of the plans covered it.
More confusing is Washington States decision to put a cease and desist on Mega after they "caught" them having non-complaint plans. Now, didn't they have to review the plans when Mega filed them before they hit the market? How would Washington have been "surprised" to learn the plans weren't compliant?
http://www.insurance.wa.gov/news/dynamic/newsreleasedetail.asp?rcdNum=439
I know for a fact that complications of pregnancy is a Maryland mandate and also know when I was with Mega that none of the plans covered it.
More confusing is Washington States decision to put a cease and desist on Mega after they "caught" them having non-complaint plans. Now, didn't they have to review the plans when Mega filed them before they hit the market? How would Washington have been "surprised" to learn the plans weren't compliant?
http://www.insurance.wa.gov/news/dynamic/newsreleasedetail.asp?rcdNum=439
- Thread starter
- #36
DOI's are hopelessly over-worked and under-staffed. Some of the plans can escape state mandates since they are not HIPAA compliant and not true major med plans. The indemnity plans such as offered thru Assurity, AIG and others do not have to comply.
The Mega plans sold in GA do have riders attached to the base policy (at least, the last time I checked they did). Can't say if the riders are compulsory or optional, but the riders do cover things like well baby & immunizations, STD testing, etc.
WA is an odd state that seems to march to a different drummer. They are one of a handful of states that have declared discount plans to be illegal. Since the DOI really has no governance over discount plans they got the AG involved.
Just because a carrier is SUPPOSED to file before offering the plan in the state does not mean there are not plans that have never been reviewed. Some folks feel it is easier to ask forgiveness than permission.
I suspect there are carriers & marketers operating in this fashion in several states.
The Mega plans sold in GA do have riders attached to the base policy (at least, the last time I checked they did). Can't say if the riders are compulsory or optional, but the riders do cover things like well baby & immunizations, STD testing, etc.
WA is an odd state that seems to march to a different drummer. They are one of a handful of states that have declared discount plans to be illegal. Since the DOI really has no governance over discount plans they got the AG involved.
Just because a carrier is SUPPOSED to file before offering the plan in the state does not mean there are not plans that have never been reviewed. Some folks feel it is easier to ask forgiveness than permission.
I suspect there are carriers & marketers operating in this fashion in several states.
- 14,808
I honestly cannot figure out Association coverage. What difference does it make if Aetna needs prior approval and increases 27% in VA and drops maternity? How is that offering more protection?
The DOI's would like everything to think that association carriers are running around like it's the wild west doing whatever they want but I can't find the difference.
The domiciled plans in MD offer no choices. How does it benefit the client to be age 45 and have Aetna say "then your rate is $365 sir." The client says "can't afford that. Anything for $300?" Aetna says "At your age? Nope."
If anyone can pull out of a state and anyone can ram increases up anyone's ass then what's the difference?
The DOI's would like everything to think that association carriers are running around like it's the wild west doing whatever they want but I can't find the difference.
The domiciled plans in MD offer no choices. How does it benefit the client to be age 45 and have Aetna say "then your rate is $365 sir." The client says "can't afford that. Anything for $300?" Aetna says "At your age? Nope."
If anyone can pull out of a state and anyone can ram increases up anyone's ass then what's the difference?
- 307
Good point John. FL rates seem to go up the same level for assoc. versus FL filed plans.
