H.B. 218

1

PRIVATE HEALTH INSURANCE - WAIVER
2 OF HEALTH CONDITION
3 2004 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Chad E. Bennion
6
7 LONG TITLE
8 General Description:
9 This bill amends the Individual, Small Employer Group Health Insurance Act to create
10 condition-specific exclusion riders.
11 Highlighted Provisions:
12 This bill:
13 . takes away the commissioner's rulemaking authority to designate the health
14 conditions that may be excluded from health insurance coverage;
15 . establishes in statute the specific health conditions that may be excluded from
16 health insurance coverage;
17 . expands what is excluded from coverage by excluding treatment and prescription
18 drugs related to that specific condition; and
19 . provides that conditions related to cancer or a mastectomy may not be excluded
20 from coverage.
21 Monies Appropriated in this Bill:
22 None
23 Other Special Clauses:
24 None
25 Utah Code Sections Affected:
26 AMENDS:
27 31A-30-107.5, as last amended by Chapter 252, Laws of Utah 2003

28
29 Be it enacted by the Legislature of the state of Utah:
30 Section 1. Section 31A-30-107.5 is amended to read:
31 31A-30-107.5. Limitations and exclusions.
32 (1) A health benefit plan may impose a preexisting condition exclusion only if:
33 (a) the exclusion relates to a condition, regardless of the cause of the condition, for
34 which medical advise, diagnosis, care, or treatment was recommended or received within the
35 six-month period ending on the enrollment date;
36 (b) the exclusion extends for a period of:
37 (i) not more than 12 months after the enrollment date; or
38 (ii) in the case of a late enrollee, 18 months after the enrollment date; and
39 (c) the period described in Subsection (1)(b) is reduced by the aggregate of the periods
40 of creditable coverage applicable to the participant or beneficiary as of the enrollment date.
41 (2) Creditable coverage shall be provided for the period of time the individual was
42 previously covered by:
43 (a) public or private health insurance; or
44 (b) any other group health plan as defined in 42 U.S.C. Section 300gg-91.
45 (3) (a) The period of continuous coverage under Subsection (1)(c) may not include any
46 waiting period for the effective date of the new coverage applied by the employer or the carrier.
47 (b) This Subsection (3) does not preclude application of any waiting period applicable
48 to all new enrollees under the plan.
49 (4) (a) Credit for previous coverage as provided under Subsection (1)(c) need not be
50 given for any condition that was previously excluded under a condition-specific exclusion rider
51 issued pursuant to Subsection (6).
52 (b) A new preexisting waiting period may be applied to any condition that was
53 excluded by a rider under the terms of previous individual coverage.
54 (5) (a) For purposes of Subsection (1)(c), a period of creditable coverage may not be
55 counted with respect to enrollment of an individual under a health benefit plan, if:
56 (i) after the period and before the enrollment date, there was a 63-day period during all
57 of which the individual was not covered under any creditable coverage; or
58 (ii) the insured fails to provide notification of previous coverage to the covered carrier

59 within 36 months of the coverage effective date if the covered carrier has previously requested
60 the notification.
61 (b) (i) Credit for previous coverage as provided under Subsection (1)(c) need not be
62 given for any condition that was previously excluded in compliance with Subsection (6).
63 (ii) A new preexisting waiting period may be applied to any condition that was
64 excluded under the terms of previous individual coverage.
65 (6) (a) An individual carrier:
66 (i) shall offer a health benefit plan in compliance with Subsection (1); [and]
67 (ii) may, when the individual carrier and the insured mutually agree in writing to a
68 condition-specific exclusion rider, offer to issue an individual policy that excludes all treatment
69 and prescription drugs related to a specific physical condition, or any specific or class of
70 prescription drugs consistent with Subsection (6)(b)[.]; and
71 (iii) may offer an individual policy that may establish separate cost sharing
72 requirements including, deductibles and maximum limits that are specific to covered services
73 and supplies, including specific drugs, when utilized for the treatment and care of the
74 conditions listed in Subsection (6)(b).
75 (b) (i) [The commissioner shall establish by rule a list of life threatening physical
76 conditions that may] The following may not be the subject of a condition-specific exclusion
77 rider[.] except when a mastectomy has been performed or the condition is due to cancer:
78 (A) conditions of the bones or joints of the ankle, arm, elbow, foot, hand, hip, knee,
79 leg, wrist, shoulder, spine, and toes, including bone spurs, bunions, carpal tunnel syndrome,
80 club foot, hammertoe, syndactylism, and treatment and prosthetic devices related to
81 amputation;
82 (B) anal fistula, breast implants, breast reduction, cystocele, enuresos, hemorrhoids,
83 hydrocele, hyospadius, uterine leiomyoma, variocele, spermatocele, endometriosis;
84 (C) cleft lip, cleft palate, deviated nasal septum, and other sinus related conditions;
85 (D) goiter and other thyroid related conditions, hemangioma, hernia, keloids,
86 migraines, scar revisions, varicose veins, abdominoplasty;
87 (E) cataracts, cornia transplant, detached retina, glaucoma, keratoconus, macular
88 degeneration, strabismus;
89 (F) Baker cyst;

90 (G) allergies; and
91 (H) any specific or class of prescription drugs.
92 (ii) A condition-specific exclusion rider:
93 (A) shall be limited to the excluded condition; and
94 (B) may not extend to any secondary medical condition that may or may not be directly
95 related to the excluded condition.
96 (7) Notwithstanding the other provisions of this section, a health benefit plan may
97 impose a limitation period if:
98 (a) each policy that imposes a limitation period under the health benefit plan specifies
99 the physical condition that is excluded from coverage during the limitation period;
100 (b) the limitation period does not exceed 12 months;
101 (c) the limitation period is applied uniformly; and
102 (d) the limitation period is reduced in compliance with Subsection (1)(c).




Legislative Review Note
as of 1-19-04 8:59 AM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel