The purpose of this chapter is to describe how the Board of Directors of the Maryland Health Insurance Plan shall operate and administer the Maryland Health Insurance Plan. In this chapter, the following terms have the meanings indicated. Terms Defined. “Administrator” means: A person that is registered as an administrator under Insurance Article, Title 8, Subtitle 3, Annotated Code of Maryland; or A carrier. “Board” means the Board of Directors for the Maryland Health Insurance Plan. “Carrier” means: An authorized insurer that provides health insurance in the State; A nonprofit health service plan that is licensed to operate in the State; or A health maintenance organization that is licensed to operate in the State. “Commission” means the Health Services Cost Review Commission. “Creditable coverage” has the meaning stated in Insurance Article, §15-1301(f), Annotated Code of Maryland. “Date of adoption” means the earlier of: A judicial decree of adoption; or The assumption of custody, pending adoption, of a prospective adoptive child by a prospective adoptive parent. “Employer sponsored plan” has the meaning stated in Insurance Article, §15-1301(h), Annotated Code of Maryland. “Fund” means the Maryland Health Insurance Plan Fund. “Grace period” means the period of 30 days following the due date of a premium, other than the first premium payable by an individual applying for coverage under the Plan, during which an individual may pay the premium to the Plan administrator and coverage continues under the Plan, without lapse. “Health benefit plan” has the meaning stated in Insurance Article, §15-1301(k), Annotated Code of Maryland. “Hospital” means each hospital in the State for which rates are established by the Commission. Medically Uninsurable Individual. “Medically uninsurable individual” means an individual who is a resident of the State and who: Provides evidence that, for health reasons, a carrier has refused to issue substantially similar coverage to the individual; Provides evidence that, for health reasons, a carrier has refused to issue substantially similar coverage to the individual, except at a rate that exceeds the Plan rate; Is an eligible individual under Insurance Article, §15-1301, Annotated Code of Maryland; Has a history of or suffers from a medical or health condition under COMAR 31.17.02.02B(2); Is eligible for the tax credit for health insurance costs under §35 of the Internal Revenue Code; or Is a dependent of an individual who is a medically uninsurable individual under §B(12)(a)(i)—(v) of this regulation. “Medically uninsurable individual” does not include an individual who is eligible for coverage under: The federal Medicare program; The Maryland Medical Assistance Program; The Maryland Children's Health Program; or An employer-sponsored group health insurance plan that includes benefits comparable to Plan benefits, unless the individual is eligible for the tax credit for health insurance costs under §35 of the Internal Revenue Code. “Member” means an individual covered under the Plan. “Plan” means the Maryland Health Insurance Plan. “Plan administrator” means the administrator selected by the Board to administer the Plan. Preexisting Condition. “Preexisting condition” means a condition for which medical advice, diagnosis, care, or treatment was recommended or received within the 6-month period ending on the date of enrollment for the Plan. “Preexisting condition” does not include pregnancy or congenital or birth defects of a newborn child. Substantially Similar Coverage. “Substantially similar coverage” means coverage under any: Contract providing hospital, medical, or surgical benefits on an expense incurred basis issued by an insurer; Contract issued by a nonprofit health service plan; Contract issued by a health maintenance organization; or Employer-sponsored plan that provides health benefits to the employees of the employer. “Substantially similar coverage” does not include one or more, or any combination of the following: Coverage only for accident or disability insurance; Coverage issued as a supplement to liability insurance; Coverage only for travel insurance; Liability insurance, including general liability insurance and automobile liability insurance; Workers' Compensation or similar insurance; Automobile medical payment insurance; Credit-only insurance; or Coverage for on-site medical clinics. “Substantially similar coverage” does not include the following benefits if they are provided under a separate policy, certificate, or contract of insurance or are otherwise not an integral part of the health plan: Limited scope dental or vision benefits; Limited scope prescription drug benefits; Benefits for long-term care, nursing home care, home health care, community-based care, or any combination of these benefits; Coverage only for a specified disease or illness; or Hospital indemnity or other fixed indemnity insurance. “Substantially similar coverage” does not include coverage listed under §B(17)(a) of this regulation if: The carrier is willing to issue the coverage only with a waiver rider for a specific condition or conditions; or The coverage has annual out-of-pocket expenses for deductibles, co-payments, and other amounts, but not premiums, that exceed the amount of annual out-of-pocket expenses allowed for a high deductible plan as defined by §223(c)(2)(A) of the Internal Revenue Code, and as adjusted for inflation. The Board shall meet at the times and places and with the frequency that the Board considers appropriate to conduct the business of the Plan. The Board shall adopt through bylaws the procedures for providing notice of Board meetings. The Board shall appoint an Executive Director who shall be the chief administrative officer of the Plan. The Executive Director shall serve at the pleasure of the Board. Under the direction of the Board, the Executive Director shall perform any duty or function that is necessary for the operation of the Plan. The Board may contract with independent consultants to perform any function that the Board assigns to the consultants, including actuarial analysis and financial analysis. Unless permission is granted specifically by the Board, an independent consultant that contracts with the Board may not release, publish, or otherwise use any information to which the independent consultant had access under its contract with the Board. The Board shall select a Plan administrator. The Board may select more than one Plan administrator, if the Board decides to contract with different administrators to administer: Different standard benefit packages; Specific benefits, such as a prescription drug benefit; or Specific administrative functions of the Plan, such as case management. Each Plan administrator shall serve for a period of time specified in its contract with the Board, subject to removal for cause and any other terms, conditions, and limitations contained in the contract. Each Plan administrator shall perform functions relating to the Plan as required by the Board, including: Determination of eligibility; Data collection; Case management; Financial tracking and reporting; Payment of claims; and Premium billing. The Board shall assume all insurance risk associated with covered benefits under the Plan. Each year, the Commission shall calculate the monthly Plan assessment that each hospital shall pay to the Fund. The Commission shall send a billing notice to each hospital for its Plan assessment. Beginning April 1, 2003, each hospital shall forward its monthly Plan assessment to the Fund. Any failure by a hospital to pay the required Plan assessment shall be monitored by the Board, or its designee, and reported to the Commission. The assets of the Fund shall be invested in the State Treasurer's interest allocation program, which shall provide interest to the Fund at the rate the State's General Fund earns interest on its investments. The Board shall establish at least two standard benefit packages to be offered by the Plan. The Board may choose to establish the standard benefit packages with the only difference between each standard benefit package being in the area of the cost-sharing requirements. The standard benefit packages established by the Board shall be described in the contract between the Plan administrator and the Board and shall include: A list of covered benefits; A list of exclusions and limitations; and A description of the cost-sharing arrangements, including any deductibles, copayments, coinsurance, and annual or lifetime maximums. Review of Standard Benefit Packages. The standard benefit packages shall be reviewed by the Board from time to time. All changes made in the standard benefit packages pursuant to the review described in §D(1) of this regulation shall be effective for contracts issued or renewed on or after the first July 1 that follows the date the Board makes the changes. The Board shall establish a premium rate for each standard benefit package in the Plan. The Board may contract with an actuary to establish the premium rate for each standard benefit package in the Plan. Standard Risk Rate. The Board shall establish a standard risk rate premium rate for each standard benefit package in the Plan. The standard risk rate for each standard benefit package in the Plan shall be developed by considering the premium rates charged by carriers in the State for coverage comparable to that of the standard benefit package. The Board may contract with an actuary to establish each standard risk rate. Variations in Plan Premium. Except as permitted under §D(2) of this regulation, the premium rate for each standard benefit package in the Plan may vary only on the basis of family composition. If the Board determines that a standard risk rate would create market dislocation, the Board may adjust the premium rate based on member age. The premium rate for each standard benefit package in the Plan may not: Be less than 110 percent of the standard risk rate; or Exceed 200 percent of the standard risk rate. The premium rates for the Plan shall be reasonably calculated to encourage enrollment in the Plan. The Board may subsidize the premiums, deductibles, and other expenses of an individual based on the individual's income if the individual: Is enrolled, or eligible to enroll, in the Plan; Has an annual household income that is at or below a percentage of the federal poverty level established by the Board; Submits to the plan administrator an application for the low-income subsidy on the form required by the Board; and Provides to the plan administrator verification of annual household income in a form acceptable to the Board. Initial Application. An individual may apply for a low-income subsidy at any time. If an applicant for a low-income subsidy fails to provide all of the required documentation, the plan administrator shall notify the applicant of: The additional documentation that is required; and The deadline set by the plan administrator for receipt of the additional documentation. If the applicant fails to provide the additional documentation by the deadline: The plan administrator shall notify the applicant that the applicant has not demonstrated eligibility for the low-income subsidy and bill the applicant for standard Plan enrollment; and The applicant shall reapply for a low-income subsidy if the applicant wishes to receive future consideration for a low-income subsidy. Recertification. Each year, the plan administrator shall mail a low-income subsidy recertification form to each member currently receiving a low-income subsidy. The form shall require the member to provide to the plan administrator updated verification of annual household income: In a form acceptable to the Board; and That demonstrates continued eligibility for the low-income subsidy. If a member who is receiving a low-income subsidy fails to demonstrate continued eligibility for the low-income subsidy, the member may select a standard Plan design option during open enrollment. If a member who fails to demonstrate continued eligibility for the low-income subsidy fails to select a standard Plan design option during open enrollment, the plan administrator shall place the member in a Plan design option in accordance with standards established by the Board. Enrollment Capacity. The Board shall determine the number of members who may receive the low-income subsidy each year. If the Board determines that the maximum number of members are receiving the low-income subsidy for a year, the plan administrator shall: Discontinue granting the low-income subsidy; and Establish a waiting list of individuals who are eligible for the low-income subsidy. An individual on the waiting list may enroll in a standard Plan design option until a low-income subsidy becomes available to the individual. Fraud. The plan administrator immediately shall cease the low-income subsidy to a member if the plan administrator determines that the member received the low-income subsidy based on fraudulent documentation or statements, including any material misrepresentation but for which the member would not have received the low-income subsidy. The Plan may recover from any member or former member the amount of any low-income subsidy that the member or former member received due to the Plan's reliance on a material misrepresentation by the member or former member. The Board shall annually evaluate the Plan to assure that Plan enrollment does not exceed the number of members the Plan has the financial capacity to insure. The Board shall establish and maintain public awareness of the Plan, including its eligibility requirements and enrollment procedures. The methods to be used by the Board to establish and maintain public awareness of the Plan shall include, but are not limited to: Establishing a mailing list of interested persons, advocacy groups, carriers, and potential applicants to the Plan for the purpose of notifying them of the availability of coverage under the Plan; Releasing periodic press releases and articles that provide status reports on the operation of the Plan and information and instructions to eligible individuals who might be interested in applying for coverage under the Plan; Speaking to interested health insurance industry and public groups regarding the Plan; Distributing a brochure to interested persons through the Plan administrator that describes the coverage available through the Plan and the process by which an individual may apply for coverage under the Plan; Publishing an annual report to the General Assembly, participants, and other interested persons regarding the status of the Plan, its mission, and general eligibility information; Familiarizing insurance producers with the coverage available through the Plan and the process by which they may assist individuals in applying for coverage under the Plan; and Other mechanisms and activities the Board determines would be effective and appropriate. Fees for Insurance Producers. The Plan administrator shall pay a referral fee of $100 to a licensed life and health insurance producer if: The insurance producer assists an individual in completing an application for the Plan; and The individual is accepted by the Plan. The licensed life and health insurance producer is not required to be appointed to the Plan to receive the $100 referral fee referenced in §C(1) of this regulation. The Plan administrator shall issue certificates of coverage to individuals covered under the Plan that describe the essential features of the Plan including: Benefits; Exclusions and limitations; Cost-sharing requirements; Any annual or lifetime maximums; Termination provisions; and Any utilization review or precertification requirements. If dependents are included in the coverage, only one certificate shall be issued for each family unit. Except as provided in §§D—F of this regulation, an individual is eligible for coverage under the Plan if the individual is: A medically uninsurable individual; and Satisfies any applicable residency requirement in §C of this regulation. Eligibility for Employer-Sponsored Group Health Insurance Plan. For purposes of determining whether an individual who is eligible for coverage under an employer-sponsored group health insurance plan is a medically uninsurable individual under Regulation .02B(12)(b)(iv) of this chapter, benefits provided by an employer-sponsored group health insurance plan are not comparable to benefits provided by the Maryland Health Insurance Plan if: The employer-sponsored group health insurance plan does not provide coverage for any one of the following major categories of treatments, services, or supplies: Blood and blood products; Chemotherapy and radiation therapy; Diabetic equipment and services; Dialysis; Durable medical equipment and disposable medical supplies; Emergency services and urgent care; Family planning services; Habilitative care; Home health care; Hospice care; Hospital inpatient services; Infertility testing and diagnosis; Maternity care; Mental health and substance abuse services; Organ and tissue transplants; Outpatient services; Physician services; Prescription drugs; Preventive services; Prosthetics; Rehabilitation services; or Skilled nursing facility; The employer-sponsored group health insurance plan imposes an annual limit on the cost or number of covered treatments, services, or supplies that is less than 50 percent of any annual limit on the cost or number of covered treatments, services, or supplies imposed by the Maryland Health Insurance Plan; or The only option or options available under the employer-sponsored group health insurance plan have annual out-of-pocket expenses for deductibles, co-payments, and other amounts, but not premiums, that exceed the amount of annual out-of-pocket expenses allowed for a high deductible plan as defined by §223(c)(2)(A) of the Internal Revenue Code, and as adjusted for inflation. Benefits provided by an employer-sponsored group health insurance plan are not considered to be not comparable to benefits provided by the Maryland Health Insurance Plan solely because the employer-sponsored group health insurance plan: Excludes coverage for a particular treatment, service, procedure, device, or type of supply that is covered by the Plan; Imposes a temporary preexisting condition exclusion at a time when the Plan does not impose a preexisting condition exclusion; or Imposes a temporary preexisting condition exclusion that is different in scope or duration from a preexisting condition exclusion that is imposed by the Plan. Residency Requirements. Unless an individual satisfies the requirements of §C(2) of this regulation, an individual shall be a resident of Maryland for at least 6 months in order to be eligible for the Plan. An individual may not be required to satisfy the 6-month residency requirement found in §C(1) of this regulation if the individual is a resident of the State and: Is an eligible individual under Insurance Article, §15-1301, Annotated Code of Maryland; Applies for coverage under the Plan within 63 days of losing coverage under another state's high-risk pool; or Is eligible for the tax credit for health insurance costs under §35 of the Internal Revenue Code. Except as provided in §E of this regulation, an individual is not eligible for Plan coverage if: The individual's coverage under the Plan was terminated for nonpayment of premium; and The individual applies for Plan coverage within 12 months of the individual's Plan coverage being terminated for nonpayment of premium. An individual may not be denied Plan coverage under §D of this regulation, if the individual: Becomes covered under other substantially similar coverage within 63 days of terminating Plan coverage; Is terminated from the substantially similar coverage referenced in §E(1) of this regulation for a reason other than nonpayment of premium by: The individual; or A family member of the individual; and Applies for coverage under the Plan within 63 days of being terminated from the substantially similar coverage referenced in §E(1) of this regulation. An individual is not eligible for Plan coverage if the individual's coverage under the Plan has been previously terminated due to fraud or intentional misrepresentation. The Board or the Plan administrator, acting on behalf of the Board, shall accept and process applications from individuals for enrollment in the Plan. Except as provided in §C of this regulation, an individual may apply for coverage under the Plan throughout each year. If an individual's eligibility is based on the individual's prior denial of coverage by a carrier, the individual may only apply for Plan coverage within 6 months of the receipt of the prior denial. An individual who enrolls in one standard benefit package may change coverage to another standard benefit package under the Plan only during the time periods specified in the individual's certificate of coverage. The Board may implement a preexisting condition exclusion for the Plan, which shall be described in the Board's contract with the Plan administrator. If the Board implements a preexisting condition exclusion for the Plan, the preexisting condition exclusion may not apply to: An eligible individual under the Maryland Health Insurance Portability and Accountability Act as defined in Insurance Article, §15-1301, Annotated Code of Maryland, if the individual applies for the Plan coverage within 63 days of losing prior coverage; A newborn child, provided that if an additional premium is required for the child's coverage, the child is enrolled within 31 days after the date of birth; A newly adopted child, provided that if an additional premium is required for the child's coverage, the child is enrolled within 31 days after the date of adoption; or An individual who: Has 3 months of prior creditable coverage; Is eligible for the tax credit for health insurance costs under §35 of the Internal Revenue Code; and Applies for the Plan coverage within 63 days after losing prior creditable coverage. If an individual applies for coverage under the Plan within 63 days of losing prior creditable coverage, the period of any preexisting condition exclusion shall be reduced by the period of time the individual was covered under prior creditable coverage. Termination of Plan Coverage for Nonpayment of Premium. A member's coverage automatically terminates at the end of the grace period if a premium is not received before the end of the grace period. Termination of Plan Coverage for Specified Causes. A member's coverage under the Plan terminates at the end of the month in which any of the following occur: For a dependent child, other than a child who is unable to self support due to physical or mental incapacity, when the dependent child reaches the limiting age found in the member's certificate of coverage; or The member ceases to be a resident of the State. A member's coverage shall terminate under the Plan if: The member or the member's covered dependent has performed an act or practice that constitutes fraud; The member has made an intentional misrepresentation of material fact in the application for Plan coverage; The member becomes covered under other coverage that is substantially similar to the coverage of the Plan; The member becomes eligible for employer sponsored coverage that includes benefits comparable to Plan benefits, unless the member is eligible for the tax credit for health insurance costs under §35 of the Internal Revenue Code; or The member becomes eligible for coverage under Medicare, the Maryland Medical Assistance Program, or the Maryland Children's Health Program. If a member's coverage terminates for one of the reasons described in §B(2)(a)—(e) of this regulation, coverage for the member and any of the member's dependents ends following notice from the Plan administrator on the following dates: If the Plan administrator gives notice of termination before the 15th day of a month, at the end of that month; or If the Plan administrator gives notice of termination on or after the 15th day of a month, at the end of the following month. Termination for Moving Out of the Service Area. If the Board selects a health maintenance organization to be one of the standard benefit packages offered under the Plan, a member's coverage under the Plan terminates at the end of the month when the member moves out of the service area of the health maintenance organization. If a member's coverage under the Plan terminates for the reason described in §C(1) of this regulation, the member shall be given an option to enroll immediately into one of the other standard benefit packages offered by the Plan, if the member continues to reside within the State. If a member has other health care coverage, the Plan administrator shall coordinate benefits with that other health care coverage in accordance with the terms described in the Plan administrator's contract with the Board. The Plan administrator shall comply with the complaint process for adverse decisions and grievance decisions in Insurance Article, Title 15, Subtitle 10A, Annotated Code of Maryland. The Plan administrator shall comply with the complaint process for coverage decisions in Insurance Article, Title 15, Subtitle 10D, Annotated Code of Maryland. Members and providers shall have the same appeal rights regarding denials under the Plan as found under Insurance Article, Title 15, Subtitles 10A and 10D, Annotated Code of Maryland. Complaints Regarding Eligibility Denials. An individual shall file any initial complaints regarding an eligibility denial with the Plan administrator. If the Plan administrator upholds its initial denial regarding an individual's eligibility for Plan coverage, the individual may appeal this denial to the Board or its designee. Insurance Article, §14-503(k), Annotated Code of Maryland Effective date: Regulations .01—.19 adopted as an emergency provision effective April 8, 2003 (30:9 Md. R. 609); emergency text amended effective July 1, 2003 (30:16 Md. R. 1072); adopted permanently effective December 22, 2003 (30:25 Md. R. 1851) Regulation .01B amended effective May 21, 2007 (34:10 Md. R. 891) Regulation .02B amended effective February 22, 2010 (37:4 Md. R. 343); August 9, 2010 (37:16 Md. R. 1060); January 7, 2013 (39:26 Md. R. 1666) Regulation .10E amended effective January 7, 2013 (39:26 Md. R. 1666) Regulation .10-1 adopted effective May 21, 2007 (34:10 Md. R. 891) Regulation .12C amended effective January 30, 2006 (33:2 Md. R. 85) Regulation .14 amended effective May 4, 2009 (36:9 Md. R. 654); February 22, 2010 (37:4 Md. R. 343)