§1067.  Guaranteed availability of coverage for employers in the group market

A.(1)  Except as provided in Subsections B through E of this Section, each health insurance issuer that offers health insurance coverage in the small group market shall do the following:

(a)  Accept every small employer, as defined in R.S. 22:1061(5)(e), in the state that applies for such coverage.

(b)  Accept for enrollment under such coverage every eligible individual, as defined in Paragraph (2) of this Subsection, who applies for enrollment during the period in which the individual first becomes eligible to enroll under the terms of the group health plan and may not place any restriction which is inconsistent with R.S. 22:1063 on an eligible individual being a participant or beneficiary.

(2)  For purposes of this Section, the term "eligible individual" means, with respect to a health insurance issuer that offers health insurance coverage to a small employer in connection with a group health plan in the small group market, such an individual in relation to the employer as shall be determined as follows:

(a)  In accordance with the terms of such plan.

(b)  As provided by the issuer under rules of the issuer which are uniformly applicable in this state to small employers in the small group market.

(c)  In accordance with all applicable state laws governing such issuer and such market.

B.(1)  In the case of a health insurance issuer that offers health insurance coverage in the small group market through a network plan, the issuer may do the following:

(a)  Limit the employers that may apply for such coverage to those with eligible individuals who live, work, or reside in the service area for such network plan.

(b)  Within the service area of such plan, deny such coverage to such employers if the issuer has demonstrated to the commissioner of insurance each of the following:

(i)  It will not have the capacity to deliver services adequately to enrollees of any additional groups because of its obligations to existing group contract holders and enrollees.

(ii)  It is applying this Paragraph uniformly to all employers without regard to the claims experience of those employers and their employees, and their dependents, or any health status-related factor relating to such employees and dependents.

(2)  An issuer, upon denying health insurance coverage in any service area in accordance with Subparagraph (1)(b) of this Subsection, may not offer coverage in the small group market within such service area for a period of one hundred eighty days after the date such coverage is denied.

C.(1)  A health insurance issuer may deny health insurance coverage in the small group market if the issuer has demonstrated, if required, to the commissioner of insurance each of the following:

(a)  It does not have the financial reserves necessary to underwrite additional coverage.

(b)  It is applying this Paragraph uniformly to all employers in the small group market in the state consistent with applicable state law and without regard to the claims experience of those employers and their employees, and their dependents, or any health status-related factor relating to such employees and dependents.

(2)  A health insurance issuer upon denying health insurance coverage in connection with group health plans in accordance with Paragraph (1) of this Subsection in this state may not offer coverage in connection with group health plans in the small group market in this state for a period of one hundred eighty days after the date such coverage is denied or until the issuer has demonstrated to the commissioner of insurance, that the issuer has sufficient financial reserves to underwrite additional coverage, whichever is later. The commissioner of insurance may issue reasonable regulations for the application of this Subsection on a service-area-specific basis.

D.(1)  The provisions of Subsection A of this Section shall not be construed to preclude a health insurance issuer from establishing employer contribution rules or uniform group participation rules for the offering of health insurance coverage in connection with a group health plan in the small group market, as allowed under applicable state law.

(2)(a)  The term "employer contribution rule" means a requirement relating to the minimum level or amount of employer contribution toward the premium for enrollment of participants and beneficiaries.

(b)  The term "group participation rule" means a requirement relating to the minimum number of participants or beneficiaries that must be enrolled in relation to a specified percentage or number of eligible individuals or employees of an employer, but in no event shall any plan require greater than seventy-five percent participation of eligible individuals.

E.  Exception for coverage offered only to bona fide association members.  The provisions of Subsection A of this Section shall not apply to health insurance coverage offered by a health insurance issuer if such coverage is made available in the small group market only through one or more bona fide associations as defined in R.S. 22:1061(5)(b).

Acts 1997, No. 1138, §1, eff. July 14, 1997; Redesignated from R.S. 22:250.6 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009.

NOTE:  Former R.S. 22:1067 redesignated as R.S. 22:844 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009.