No. 34075 (Repeal): Rule R590-253. Utah Mini-COBRA Notification Rule

(Repeal)

DAR File No.: 34075
Filed: 09/14/2010 04:07:22 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule was adopted to provide information and forms necessary to help a person qualified for and applying for COBRA insurance receive a subsidy to help pay for the premium. This was a result of the American Recovery and Reinvestment Act (ARRA) of 2009, Section 3001(a)(7). This subsidy was no longer available as of 05/31/2010. As a result, this rule is no longer necessary.

Summary of the rule or change:

This rule was adopted to provide information and forms necessary to help a person qualified for and applying for COBRA insurance receive a subsidy to help pay for the premium. This was a result of the American Recovery and Reinvestment Act (ARRA) of 2009, Section 3001(a)(7). This subsidy was no longer available as of May 31, 2010. As a result, this rule is no longer necessary. Therefore, this rule is repealed it its entirety.

State statutory or constitutional authorization for this rule:

• Section 31A-2-201

Anticipated cost or savings to:

the state budget:

The repeal of this rule will not affect the workload or revenues of the department. Insurers were not required to file forms or fees with the department when the rule went into effect so no additional filings will be required with its repeal.

local governments:

Local governments will not be affected by the repeal of this rule since it dealt solely with the relationship between the department and its health insurance licensees.

small businesses:

Employers will be required to change their current mini-COBRA notification forms to eliminate any reference to the federal subsidy. These forms are not filed with the department. Businesses knew that this law was temporary so probably had a small supply of these forms on hand that they now will have to dispose of. There should be just a small cost in the time it takes to change the form back to the way it was before the subsidy was made available and to make any hard copies they may want to have on hand.

persons other than small businesses, businesses, or local governmental entities:

Insurers will need to change their notification forms to eliminate the reference to the subsidy. They knew that this would be temporary and likely have very few on hand to dispose of and replace. This will be a minor cost to them. There will be some printing and paper costs to replace their current form.

Compliance costs for affected persons:

Insurers and employers will need to change their notification forms to eliminate the reference to the subsidy. They knew that this would be temporary and likely have very few on hand to dispose of and replace. This will be a minor cost to them. There will be some printing and paper costs to replace their current form. The largest financial loss will be to the consumer who has been laid off from work and will now have to pay the full COBRA premium himelf or herself now that the federal subsidies are not available.

Comments by the department head on the fiscal impact the rule may have on businesses:

The cost to employers will be minor as they adjust their notification forms to eliminate the reference to a premium subsidy and eliminate current forms. Whatever costs they do have will be in printing and paper.

Neal T. Gooch, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Insurance
Administration
450 N MAIN ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Jilene Whitby at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

11/01/2010

This rule may become effective on:

11/08/2010

Authorized by:

Jilene Whitby, Information Specialist

RULE TEXT

R590. Insurance, Administration.

[ R590-253. Utah Mini-COBRA Notification Rule.

R590-253-1. Authority.

(1) This rule is promulgated pursuant to Subsection 31A-2-201 wherein the commissioner may make rules to implement the provisions of Title 31A.

 

R590-253-2. Purpose and Scope.

(1) The purpose of this rule is to ensure that all persons who are eligible for health insurance continuation coverage under the American Recovery and Reinvestment Act of 2009, ARRA, Section 3001(a)(7) receive the necessary information and forms that will assist them in making a decision to elect continuation coverage of their health insurance coverage under Utah's mini-COBRA law.

(2) This rule applies to all accident and health insurers doing business in Utah that are required to provide continuation coverage pursuant to Sections 31A-22-722 and 722.5.

 

R590-253-3. General Instructions.

(1) An accident and health insurer shall provide the Utah mini-COBRA Continuation Coverage Election Notice for individuals eligible for Utah mini-COBRA. The notice can be downloaded from the Department's website at www.insurance.utah.gov.

(2) For individuals eligible for Utah mini-COBRA from February 17, 2009 through December 31, 2009, an accident and health insurer shall:

(a) mail the notices required by R590-253-3(1) to an individual:

(i) within seven days after being contacted by an individual or the individual's employer on or after April 6, 2009; or

(ii) no later than April 10, 2009 for an insured whose employer or the individual contacted the insurer prior to April 1, 2009; or

(b) mail the notices required by R590-253-3(1) to all employers whose coverage is subject to 31A-22-722:

(i) no later than April 10, 2009;

(ii) on the plan's anniversary renewal; and

(iii) shall include a statement of the employer's obligation on the monthly notice of premium payments.

(c) An accident and health insurer who elects to provide notification under R590-253-3(2)(b) is responsible to assure the employer has provided notification to its employees who are eligible as provided by Section 31A-22-722 and the American Recovery and Reinvestment Act of 2009, Pub. S. 111-5.

(3)(a) For individuals eligible for Utah mini-COBRA from September 1, 2008 through February 16, 2009, the notices in R590-253-3(1) shall be mailed after being contacted by an individual or the individual's employer that the individual wants to take advantage of the second election period to extend the health insurance coverage provided by the employer Section 31A-22-722.5.

(b) The notice shall be mailed:

(i) within one business day after being contacted by an individual or the individual's employer on or after April 6, 2009; or

(ii) no later than April 9, 2009 for an insured whose employer or the individual contacted the insurer prior to April 6, 2009.

 

R590-253-4. Penalties.

A person found, after a hearing or other regulatory process, to be in violation of this rule shall be subject to penalties as provided under 31A-2-308.

 

R590-253-5. Severability.

If any provision of this rule or its application to any person or circumstance is, for any reason, held to be invalid, the remainder of this rule and its application to other persons and circumstances are not affected.

 

KEY: mini-COBRA insurance

Date of Enactment or Last Substantive Amendment: July 1, 2009

Authorizing, and Implemented or Interpreted Law: 31A-2-201 ]

 

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