Applicants under age 19 applying outside of their birthday month who are not late enrollees may be rated up more than two times the base rate. They may request a reduction to no more than two times the base rate in their next open enrollment (birthday month).
For July 1, 2011 and after effective dates, Individual business is updating its underwriting guidelines to add a new 350% rating tier (Level 1+350%), increasing the maximum medical rate-up from 100% (Level 1+100%). This rating tier will only affect applicants under age 19 who:
Messaging will be added to underwriting offer and decision letters.
This rating tier may be in addition to the 20% surcharge for those applicants who have not had continuous coverage during the 90 days prior to the date of application. (CA AB 2244 (2010) Anthem Confidential Broker News)
Links
Insurance.CA.GOV Guidance
CMS FAQ's
cciio.cms.gov
Clarification Of Surcharges for Individual Applicants Under Age 19
To clarify previous messaging regarding surcharges for applicants under age 19; the applicant must have continuous coverage during the 90 day period prior to submitting the application to be exempt from the surcharge.
As a reminder, consistent with Assembly Bill (AB) 2244 and guidance from regulators, applicants under age 19 may be assessed a 20% surcharge for a period not greater than 12 months if the applicant has not had continuous coverage during the 90 day period prior to the date of the application and is not a late enrollee. (Email dated 4/4/2011)
Historical Info
Many Insurance Companies are not accepting applications for coverage for children under the age of 19 for the remainder of 2010. (CA Assembly Bill 2244, Health Net Broker Q & A HHS.Gov FAQ's)
Open enrollment period for children under the age of 19 from January 1, 2011 through March 1, 2011. During this period we will not decline coverage or impose exclusions for pre-existing conditions for children under the age of 19, including child-only applicants. We may rate-up for some medical conditions. (More details)
Blue Cross 12/30/2011 Bulletin
Full Text of Law with Steve's Annotations
10950. CA Assembly Bill 2244 As used in this chapter:
(a) "Child" means any individual under 19 years of age.
(b) "Individual grandfathered plan coverage" means health care coverage in which an individual was enrolled on March 23, 2010, consistent with Section 1251 of PPACA and any rules or regulations adopted pursuant to that law.
(c) "Initial open enrollment period" means the open enrollment period beginning on January 1, 2011, and ending 60 days thereafter.
(d) "Late enrollee" means a child without coverage who did not enroll in a health benefit plan during an open enrollment period because of any of the following:
(1) The child lost dependent coverage due to:
termination or change in employment status of the child or the person through whom the child was covered;
***Per Blue Shield - any group coverage. Blue Shield Rules
cessation of an employer's contribution toward an employee or dependent's coverage; death of the person through whom the child was covered as a dependent; legal separation; divorce;
loss of coverage under the Healthy Families Program, the Access for Infants and Mothers Program, or the Medi-Cal program;
Qualifying Events
Health Net
Insurance.CA.GOV
Health Net brochure
Blue Shield Rules
or adoption of the child.
(2) The child became a resident of California during a month that was not the child's birth month.
(3) The child is born as a resident of California and did not enroll in the month of birth.
(4) The child is mandated to be covered pursuant to a valid state or federal court order.
(e) "Open enrollment period" means the annual open enrollment period subsequent to the initial open enrollment period, applicable to each individual child that is the month of the child's birth date.
(f) "PPACA" means the federal Patient Protection and Affordable Care Act (Public Law 111-148), as amended by the Health Care and Education Reconciliation Act of 2010 (Public Law 111-152), and any subsequent rules or regulations issued pursuant to that law.
(g) "Preexisting condition exclusion" means, with respect to coverage, a limitation or exclusion of benefits relating to a condition based on the fact that the condition was present before the date of enrollment of the coverage, whether or not any medical advice, diagnosis, care, or treatment was recommended or received before that date.
(h) "Responsible party for a child" means an adult having custody of the child or with responsibility for the financial needs of the child, including the responsibility to provide health care coverage.
(i) "Standard risk rate" means the lowest rate that can be offered for a child with the same benefit
plan, effective date, age, geographic region, and family status.
10951. (a) (1) During each open enrollment period, every carrier offering health benefit plans in the individual market, other than individual grandfathered plan coverage, shall offer to the responsible party for a child coverage for the child that does not exclude or limit coverage due to any preexisting condition of the child.
(b) A carrier offering coverage in the individual market shall not reject an application for a health benefit plan from a child or filed on behalf of a child by the responsible party during an open enrollment period or from a late enrollee during a period no longer than 63 days from the qualifying event listed in subdivision (d) of Section 10950.
(c) Except to the extent permitted by federal law, rules, regulations, or guidance issued by the relevant federal agency, a carrier shall not condition the issuance or offering of individual coverage on any of the following factors:
(1) Health status.
(2) Medical condition, including physical and mental illnesses.
(3) Claims experience.
(4) Receipt of health care.
(5) Medical history.
(6) Genetic information.
(7) Evidence of insurability, including conditions arising out of acts of domestic violence.
(8) Disability.
(9) Any other health status-related factor as determined by department.
This subdivision shall not apply to a health benefit plan providing individual grandfathered plan coverage.
(d) When a responsible party for a child submits a premium payment, based on the quoted premium charges, and that payment is delivered or postmarked, whichever
occurs earlier, within the first 15 days of the month, coverage under the health benefit plan shall become effective no later than the first day of the following month. When that payment is neither delivered nor postmarked until after the 15th day of the month, coverage shall become effective no later than the first day of the second month following delivery or postmark of the payment.
(e) A carrier offering coverage in the individual market shall not
reject the request of a responsible party for a child to include
that child as a dependent on an existing health benefit plan that
includes dependent coverage during an open enrollment period.
(f) Nothing in this chapter shall be construed to prohibit a
carrier offering coverage in the individual market from establishing
rules for eligibility for coverage and offering coverage pursuant to
those rules for children and individuals based on factors otherwise
authorized under federal and state law for health benefit plans in
addition to those offered on a guaranteed issue basis during an open
enrollment period to children or late enrollees pursuant to this
chapter. However, a carrier, other than a carrier providing
individual grandfathered plan coverage, shall not impose a
preexisting condition provision on coverage, including dependent
coverage, offered to a child.
(g) Nothing in this chapter shall be construed to require a
carrier to establish a new service area or to offer health care
coverage on a statewide basis, outside of the carrier's existing
service area.
(h) Nothing in this chapter shall be construed to prevent a carrier from offering coverage to a family member of an enrollee in grandfathered health plan coverage consistent with Section 1251 of PPACA.
10952. This chapter shall not apply to health benefit plans for coverage of Medicare services
pursuant to contracts with the United States government, Medicare supplement policies, Medi-Cal contracts with the State Department of Health Care Services, policies offered under the Healthy Families Program, long-term care coverage, or specialized health benefit plans.
10953. (a) Upon the effective date of this chapter, a carrier shall fairly and affirmatively offer, market, and sell all of the carrier' s health benefit plans that are offered and sold to a child or the responsible party for a child in each service area in which the plan provides or arranges for health care coverage during any open enrollment period, to late enrollees, and during any other period in which state or federal law, rules, regulations, or guidance expressly provide that a carrier shall not condition offer or acceptance of coverage on any preexisting condition.
(b) No carrier or solicitor shall, directly or indirectly, engage in the following activities:
(1) Encourage or direct a child or responsible party for a child to refrain from filing an application for coverage with a carrier because of the health status, claims experience, industry, occupation, or geographic location, provided that the location is within the carrier's approved service area, of the child.
(2) Encourage or direct a child or responsible party for a child to seek coverage from another carrier because of the health status, claims experience, industry, occupation, or geographic location, provided that the location is within the carrier's approved service area, of the child.
(c) A carrier shall not, directly or indirectly, enter into any contract, agreement, or arrangement with a solicitor that provides for or results in the compensation paid to a solicitor for the sale of a health benefit plan to be varied because of the health status, claims experience, industry, occupation, or geographic location of the child. This
subdivision does not apply to a compensation arrangement that provides compensation to a solicitor on the basis of percentage of premium, provided that the percentage shall not vary because of the health status, claims experience, industry, occupation, or geographic area of the child.
10954. (a) A carrier may use the following characteristics of an
eligible child for purposes of establishing the rate of the health benefit plan for that child, where consistent with federal regulations under PPACA: age, geographic region, and family composition, plus the health benefit plan selected by the child or the responsible party for a child.
(b) From the effective date of this chapter to December 31, 2013, inclusive, rates for a child applying for coverage shall be subject to the following limitations:
(1) During any open enrollment period or for late enrollees, the rate for any child due to health status shall not be more than two times the standard risk rate for a child.
(2) The rate for a child shall be subject to a 20-percent surcharge above the highest allowable rate on a child applying for coverage who is not a late enrollee and who failed to maintain coverage with any carrier or health care service plan for the 90-day period prior to the date of the child's application. The surcharge shall apply for the 12-month period following the effective date of the child's coverage.
(3) If expressly permitted under PPACA and any rules, regulations, or guidance issued pursuant to that act, a carrier may rate a child based on health status during any period other than an open enrollment period if the child is not a late enrollee.
(4) If expressly permitted under PPACA and any rules, regulations, or guidance issued pursuant to that act, a carrier may condition an offer or acceptance of coverage
on any preexisting condition or other health status-related factor for a period other than an open enrollment period and for a child who is not a late enrollee.
(c) For any individual health benefit plan issued, sold, or renewed prior to December 31, 2013, the carrier shall provide to a child or responsible party for a child a notice that states the following:
"Please consider your options carefully before failing to maintain or renew coverage for a child for whom you are responsible. If you attempt to obtain new individual coverage for that child, the premium for the same coverage may be higher than the premium you pay now."
(d) A child who applied for coverage between September 23, 2010, and the end of the initial enrollment period shall be deemed to have maintained coverage during that period.
(e) Effective January 1, 2014, except for individual grandfathered health plan coverage, the rate for any child shall be identical to the standard risk rate.
(f) Carriers may require documentation from applicants relating to their coverage history.
10957. No carrier shall be required to offer a health benefit plan
or accept applications for the contract pursuant to this chapter in the case of any of the following:
(a) To a child, if the child who is to be covered by the health benefit plan does not work or reside within the carrier's approved service areas.
(b) (1) Within a specific service area or portion of a service area, if the carrier reasonably anticipates and demonstrates to the satisfaction of the commissioner that it will not have sufficient health care delivery resources to ensure that health care services will be available and accessible to the child because of its obligations to existing insured's.
(2) A carrier that cannot offer a health benefit plan to individuals or children because it is
lacking in sufficient health care delivery resources within a service area or a portion of a service area may not offer a contract in the area in which the carrier is not offering coverage to individuals to new employer groups until the carrier notifies the commissioner that it has the ability to deliver services to individuals, and certifies to the commissioner that from the date of the notice it will enroll all individuals requesting coverage in that area from the carrier.
(3) Nothing in this chapter shall be construed to limit the commissioner's authority to develop and implement a plan of rehabilitation for a carrier whose financial viability or organizational and administrative capacity has become impaired.
10958. The commissioner may require a carrier to discontinue the offering of contracts or acceptance of applications from any individual or child or responsible party for a child upon a determination by the commissioner that the carrier does not have sufficient financial viability or organizational and administrative capacity to ensure the delivery of health care services to its insured's. In determining whether the conditions of this section have been met, the commissioner shall consider, but not be limited to, the carrier's compliance with the requirements of this part and the rules adopted under those provisions.
10959. (a) All health benefit plans offered to a child or on behalf of a child to a responsible party for a child shall conform to the requirements of Section 10127.18, 12682.1, and 10273.4, and shall be renewable at the option of the child or responsible party for a child on behalf of the child except as permitted to be canceled, rescinded or not renewed pursuant to Section 10273.4.
(b) Any carrier that ceases to offer for sale new individual health benefit plans pursuant to Section 10273.4 shall continue to be governed by this chapter with respect to business
conducted under this chapter.
(c) Except as authorized under Section 10958, a carrier that as of the effective date of this chapter does not write new health benefit plans for children in this state or that after the effective date of this chapter ceases to write new health benefit plans for children in this state shall be prohibited from offering for sale new individual health benefit plans or in this state for a period of five years from the date of notice to the commissioner.
10960. On or before July 1, 2011, the commissioner may issue guidance to health plans regarding compliance with this chapter and such guidance shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. The guidance shall only be effective until the commissioner and the Director of the Department of Managed Health Care adopt joint regulations pursuant to the Administrative Procedure Act.
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