No. 32495: R590-253. Utah Mini-COBRA Notification Rule

DAR File No.: 32495
Filed: 04/02/2009, 05:23
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

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

Summary of the rule or change:

This rule ensures that all persons who are eligible for premium assistance with their health insurance continuation coverage under the ARRA Section 3001(a)(7) receive the necessary information and forms to assist them in selecting Utah's mini-COBRA. (DAR NOTE: A corresponding proposed new Rule R590-253 is under DAR No. 32528 in this issue, May 1, 2009, of the Bulletin.)

State statutory or constitutional authorization for this rule:

Section 31A-2-201

Anticipated cost or savings to:

the state budget:

The workload and revenues of the department will not be affected by this rule. No additional filings will need to be made to the department and fees and revenues to the department will not be affected.

local governments:

Local governments should not be affected by this rule since it deals solely with the relationship between the department and its health insurers and their insureds.

small businesses and persons other than businesses:

This rule standardizes the mini-COBRA notification required by Sections 31A-22-716 and 31A-22-722. Employers will have to change the current form they are using but will not have to file them with the department. Most small businesses only have a small number of these forms on hand that will need to be replaced with the new ones. Costs to replace these forms will be negligible.

Compliance costs for affected persons:

Insurers will be required to provide notification to all terminated employees of employer groups with less than 20 employees, or insurers may provide the notification to the employer groups for distribution. Costs to insurers will vary according to the number of small employer groups they insure.

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

Insurers and employers are already providing notification to terminated employees regarding Utah mini-COBRA. The cost to them will involve the cost for printing and paper to replace old forms. D. Kent Michie, Commissioner

Emergency rule reason and justification:

Regular rulemaking procedures would place the agency in violation of federal or state law.

The ARRA of 2009 was signed and went into effect on 02/17/2009. The ARRA requires the notification created by the Department of Labor be adapted for use in each state. The notification must be provided through 12/31/2009. The notification informs all terminated employees of employer groups with less than 20 employees, the availability of a federal subsidy for their mini-COBRA premiums.

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

Insurance
Administration
Room 3110 STATE OFFICE BLDG
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:

This rule is effective on:

04/02/2009

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. Enforcement Date.

The commissioner will begin enforcing this rule April 2, 2009.

 

R590-253-5. 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.

 

R590-253-6. 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: April 2, 2009

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