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1 State of Arkansas A Bill
2 95th General Assembly
3 Regular Session, 2025 HOUSE BILL 1595
4
5 By: Representative Steimel
6 By: Senator J. Boyd
7
8 For An Act To Be Entitled
9 AN ACT TO ENACT THE STATE INSURANCE DEPARTMENT'S
10 GENERAL OMNIBUS AMENDMENT OF ARKANSAS INSURANCE CODE;
11 TO AMEND THE ARKANSAS WORKERS' COMPENSATION INSURANCE
12 PLAN; TO AMEND THE LAW CONCERNING RECIPROCAL
13 INSURERS; TO CLARIFY AN ATTORNEY'S BOND REQUIREMENT;
14 TO AMEND THE LAW CONCERNING EXAMINATIONS OF HOSPITAL
15 AND MEDICAL SERVICE CORPORATIONS; TO AMEND THE LAW
16 CONCERNING SERVICE OF PROCESS IN SUITS INVOLVING
17 INSURERS; TO REPEAL THE COMPREHENSIVE HEALTH
18 INSURANCE POOL ACT; AND FOR OTHER PURPOSES.
19
20
21 Subtitle
22 TO ENACT THE STATE INSURANCE
23 DEPARTMENT'S GENERAL OMNIBUS AMENDMENT
24 OF ARKANSAS INSURANCE CODE.
25
26 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:
27
28 SECTION 1. Arkansas Code � 23-67-304(e), concerning the ability of the
29 Insurance Commissioner to delegate responsibility under the Arkansas Workers'
30 Compensation Insurance Plan, is amended to read as follows:
31 (e)(1)(A) At his or her discretion, the The Insurance Commissioner is
32 authorized to may delegate all or any part of the commissioner's
33 responsibility to establish and operate the plan.
34 (B) However, any such plan, or plan of operation, and any
35 amendments thereto must receive the prior approval of the commissioner.
36 (2) Any person or entity to whom the establishment,
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1 implementation, or operation of the plan is delegated pursuant to this
2 subsection shall file with and obtain the approval of the commissioner as to
3 all policy forms, rates, or supplementary rate information necessary to
4 effectuate the plan.
5 (3)(A) In delegating all or part of the commissioner's
6 responsibility, the commissioner shall not approve any plan or filing that
7 abrogates or restricts his or her authority to select the plan administrator
8 or servicing carriers.
9 (B) The commissioner shall competitively select the
10 organization or organizations to whom the responsibility of plan
11 administrator shall be delegated.
12 (C) If the administration of the plan is delegated, the
13 plan administrator or administrators shall have an office in Arkansas be
14 adequately staffed, outfitted, and maintained to provide the plan services
15 delegated.
16 (D) The commissioner shall specify duties and functions of
17 plan administrators and may structure and delegate administrative functions
18 separately such as, but not limited to, rates, forms, and statistics for the
19 best operation of the plan.
20 (4) Under the provisions of this subsection, the commissioner
21 shall vigorously promote competition for the designation of the plan
22 administrator and servicing carrier for the most effective operation of the
23 plan.
24 (5)(A) The office in Arkansas is established plan administrator
25 and personnel are placed in their positions to improve services provided by
26 the plan, to promote and secure courteous and timely service, and to assure
27 that the minimum standards as provided under subdivision (f)(2) of this
28 section are met.
29 (B) The office plan administrator and personnel in
30 Arkansas shall also assist employers or agents with questions, problems, or
31 complaints pertaining to the servicing carriers and secure and expedite
32 prompt and fair treatment to employers for servicing carrier errors and
33 service failures.
34 (6)(A) The Arkansas office manager shall have the authority to
35 intervene with servicing carriers to secure an adequate level of service and
36 prevent servicing carriers from imposing unreasonable demands or actions.
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1 (B) The office manager shall keep a record of all employer
2 or agent problems and complaints by a servicing carrier, including a
3 description of the problem. This record shall be provided to the commissioner
4 within sixty (60) days of each calendar year or upon the request of the
5 commissioner.
6 (C) The manager shall promptly notify the commissioner of
7 any problems upon a request by an employer.
8
9 SECTION 2. Arkansas Code � 23-70-110(a)(1), concerning the attorney's
10 bond required of a domestic reciprocal insurer, is amended to read as
11 follows:
12 (a)(1)(A) Concurrently with the filing of the declaration provided for
13 in � 23-70-106, the attorney of a domestic or foreign reciprocal insurer
14 shall file with the Insurance Commissioner a bond in favor of this state for
15 the benefit of all persons damaged as a result of breach by the attorney of
16 the conditions of his or her bond as set forth stated in subdivision (a)(2)
17 of this section.
18 (B) The bond under subdivision (a)(1)(A) of this section
19 shall be:
20 (i) executed Executed by the attorney and by an
21 authorized corporate surety; and
22 (ii) shall be subject Subject to the commissioner's
23 approval.
24
25 SECTION 3. Arkansas Code � 23-75-114(b)(2), concerning an examination
26 of a hospital and medical service corporation, is amended to read as follows:
27 (2) An examination shall be conducted at least every three (3)
28 five (5) years.
29
30 SECTION 4. Arkansas Code � 23-79-205(a), concerning service of process
31 against an insurer, is amended to read as follows:
32 (a) In any suit brought in this state against an insurer, process may
33 be served upon the insurer as follows:
34 (1) As to domestic insurers, service of process may be had only
35 in the manner as provided by � 16-58-124 the Arkansas Rules of Civil
36 Procedure;
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1 (2) As to licensed foreign or alien insurers, service on and
2 after January 1, 2003, may be made as provided in � 23-63-301 et seq.; and
3 (3) As to suits against unauthorized insurers, service of
4 process shall be made as provided in �� 23-65-101 -- 23-65-104, � 23-65-201 et
5 seq., and �� 23-65-301 -- 23-65-318 for unauthorized insurers and surplus
6 lines.
7
8 SECTION 5. Arkansas Code Title 23, Chapter 79, Subchapter 5, is
9 repealed.
10 Subchapter 5 -- Comprehensive Health Insurance Pool Act
11
12 23-79-501. Purpose.
13 (a)(1) Acts 1995, No. 1339, established the Arkansas Comprehensive
14 Health Insurance Pool as a state program that was intended to provide an
15 alternate market for health insurance for certain uninsurable Arkansas
16 residents, and further this subchapter is intended to provide for the
17 successor entity that will provide the acceptable alternative mechanism as
18 described in the Health Insurance Portability and Accountability Act of 1996
19 for providing portable and accessible individual health insurance coverage
20 for federally eligible individuals as defined in this subchapter.
21 (2) This subchapter further is intended to provide a health
22 insurance coverage option for persons eligible for a federal income tax
23 credit under section 35 of the Internal Revenue Code, as created by the Trade
24 Adjustment Assistance Reform Act of 2002 or as subsequently amended.
25 (b) The General Assembly declares that it intends for this program to
26 provide portable and accessible individual health insurance coverage for
27 every individual who qualifies for coverage in accordance with � 23-79-509(b)
28 as a federally eligible individual or as a qualified trade adjustment
29 assistance eligible person but does not intend for every eligible person who
30 qualifies for pool coverage in accordance with � 23-79-509 to be guaranteed a
31 right to be issued a policy under this pool as a matter of entitlement.
32
33 23-79-502. Short title.
34 This subchapter may be cited as the "Comprehensive Health Insurance
35 Pool Act", and is amendatory to the Arkansas Insurance Code and the
36 provisions of the Arkansas Insurance Code which are not in conflict with this
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1 subchapter are applicable to this subchapter.
2
3 23-79-503. Definitions.
4 As used in this subchapter:
5 (1) "Agent" means any person who is licensed to sell health
6 insurance in this state;
7 (2) "Board" means the Board of Directors of the Arkansas
8 Comprehensive Health Insurance Pool;
9 (3) "Church plan" has the same meaning given that term in the
10 Health Insurance Portability and Accountability Act of 1996;
11 (4) "Commissioner" means the Insurance Commissioner;
12 (5) "Continuation coverage" means continuation of coverage under
13 a group health plan or other health insurance coverage for former employees
14 or dependents of former employees that would otherwise have terminated under
15 the terms of that coverage pursuant to any continuation provisions under
16 federal or state law, including the Consolidated Omnibus Budget
17 Reconciliation Act of 1985 (COBRA), as amended, � 23-86-114 of the Arkansas
18 Insurance Code, or any other similar requirement in another state;
19 (6) "Covered person" means a person who is and continues to
20 remain eligible for pool coverage and is covered under one (1) of the plans
21 offered by the pool;
22 (7)(A) "Creditable coverage" means, with respect to a federally
23 eligible individual or a qualified trade adjustment assistance eligible
24 person, coverage of the individual under any of the following:
25 (i) A group health plan;
26 (ii) Health insurance coverage, including group
27 health insurance coverage;
28 (iii) Medicare;
29 (iv) Medical assistance;
30 (v) 10 U.S.C. � 1071 et seq.;
31 (vi) A medical care program of the Indian Health
32 Service or of a tribal organization;
33 (vii) A state health benefits risk pool;
34 (viii) A health plan offered under 5 U.S.C. � 8901 et
35 seq.;
36 (ix) A public health plan, as defined in regulations
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1 consistent with section 104 of the Health Insurance Portability and
2 Accountability Act of 1996 that may be promulgated by the Secretary of the
3 United States Department of Health and Human Services; and
4 (x) A health benefit plan under section 5(e) of the
5 Peace Corps Act, 22 U.S.C. � 2504(e).
6 (B) "Creditable coverage" does not include:
7 (i) Coverage consisting solely of coverage of
8 excepted benefits as defined in section 2791(C) of Title XXVII of the Public
9 Health Service Act, 42 U.S.C. � 300gg-91; or
10 (ii)(a) Any period of coverage under
11 subdivisions (7)(A)(i)-(x) of this section that occurred before a break of
12 more than sixty-three (63) days during all of which the individual was not
13 covered under subdivisions (7)(A)(i)-(x) of this section.
14 (b) Any period that an individual is in a
15 waiting period for any coverage under a group health plan or for group health
16 insurance coverage or is in an affiliation period under the terms of health
17 insurance coverage offered by a health maintenance organization shall not be
18 taken into account in determining if there has been a break of more than
19 sixty-three (63) days in any creditable coverage;
20 (8) "Department" means the State Insurance Department;
21 (9) "Excess or stop-loss coverage" means an arrangement whereby
22 an insurer insures against the risk that any one (1) claim will exceed a
23 specific dollar amount or that the entire loss of a self-insurance plan will
24 exceed a specific amount;
25 (10) "Federally eligible individual" means an individual resident
26 of Arkansas:
27 (A) For whom:
28 (i) As of the date on which the individual seeks
29 pool coverage under � 23-79-509, the aggregate of the periods of creditable
30 coverage is eighteen (18) or more months; and
31 (ii) The most recent prior creditable coverage was
32 under group health insurance coverage offered by an insurer, a group health
33 plan, a governmental plan, a church plan, or health insurance coverage
34 offered in connection with any such plans;
35 (B) Who is not eligible for coverage under:
36 (i) A group health plan;
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1 (ii) Part A or Part B of Medicare; or
2 (iii) Medical assistance and does not have other
3 health insurance coverage;
4 (C) With respect to whom the most recent coverage within
5 the coverage period described in subdivision (10)(A)(i) of this section was
6 not terminated based upon a factor related to nonpayment of premiums or
7 fraud;
8 (D) If the individual has been offered the option of
9 continuation coverage under a Consolidated Omnibus Budget Reconciliation Act
10 of 1985 (COBRA) continuation provision or under a similar state program, who
11 elected such coverage; and
12 (E) Who, if the individual elected the continuation
13 coverage, has exhausted the continuation coverage under such a provision or
14 program;
15 (11) "Governmental plan" has the same meaning given that term in
16 the federal Health Insurance Portability and Accountability Act of 1996;
17 (12) "Group health plan" has the same meaning given that term in
18 the federal Health Insurance Portability and Accountability Act of 1996;
19 (13)(A) "Health insurance" means any hospital and medical
20 expense-incurred policy, certificate, or contract provided by an insurer,
21 hospital or medical service corporation, health maintenance organization, or
22 any other healthcare plan or arrangement that pays for or furnishes medical
23 or healthcare services whether by insurance or otherwise and includes any
24 excess or stop-loss coverage.
25 (B) "Health insurance" does not include long-term care,
26 disability income, short-term, accident, dental-only, vision-only, fixed
27 indemnity, limited-benefit or credit insurance, coverage issued as a
28 supplement to liability insurance, insurance arising out of workers'
29 compensation or similar law, automobile medical-payment insurance, or
30 insurance under which benefits are payable with or without regard to fault
31 and that is statutorily required to be contained in any liability insurance
32 policy or equivalent self-insurance;
33 (14) "Health maintenance organization" shall have the same
34 meaning as defined in � 23-76-102;
35 (15) "Hospital" shall have the same meaning as defined in � 20-9-
36 201;
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1 (16) "Individual health insurance coverage" means health
2 insurance coverage offered to individuals in the individual market but does
3 not include short-term, limited-duration insurance;
4 (17)(A) "Insurer" means any entity that provides health
5 insurance, including excess or stop-loss health insurance, in the State of
6 Arkansas.
7 (B) For the purposes of this subchapter, "insurer"
8 includes an insurance company, medical services plans, hospital plans,
9 hospital medical service corporations, health maintenance organizations,
10 fraternal benefits society, or any other entity providing a plan of health
11 insurance or health benefits subject to state insurance regulation;
12 (18) "Medical assistance" means the state medical assistance
13 program provided under Title XIX of the Social Security Act or under any
14 similar program of healthcare benefits in a state other than Arkansas;
15 (19)(A)(i) "Medically necessary" means that a service, drug,
16 supply, or article is necessary and appropriate for the diagnosis or
17 treatment of an illness or injury in accord with generally accepted standards
18 of medical practice at the time the service, drug, or supply is provided.
19 (ii) When specifically applied to a confinement,
20 "medically necessary" further means that the diagnosis or treatment of the
21 covered person's medical symptoms or condition cannot be safely provided to
22 that person as an outpatient.
23 (B) A service, drug, supply, or article shall not be
24 medically necessary if it:
25 (i) Is investigational, experimental, or for
26 research purposes;
27 (ii) Is provided solely for the convenience of the
28 patient, the patient's family, physician, hospital, or any other provider;
29 (iii) Exceeds in scope, duration, or intensity that
30 level of care that is needed to provide safe, adequate, and appropriate
31 diagnosis or treatment;
32 (iv) Could have been omitted without adversely
33 affecting the covered person's condition or the quality of medical care; or
34 (v) Involves the use of a medical device, drug, or
35 substance not formally approved by the United States Food and Drug
36 Administration;
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1 (20) "Medicare" means coverage under Part A and Part B of Title
2 XVIII of the Social Security Act, 42 U.S.C. � 1395 et seq.;
3 (21) "Physician" means a person licensed to practice medicine as
4 duly licensed by the State of Arkansas;
5 (22) "Plan" means the comprehensive health insurance plan as
6 adopted by the board or by rule;
7 (23) "Plan administrator" means the insurer designated under �
8 23-79-508 to carry out the provisions of the plan of operation;
9 (24) "Plan of operation" means the plan of operation of the pool,
10 including articles, bylaws, and operating rules adopted by the board pursuant
11 to this subchapter;
12 (25) "Provider" means any hospital, skilled nursing facility,
13 hospice, home health agency, physician, pharmacist, or any other person or
14 entity licensed in Arkansas to furnish medical care, articles, and supplies;
15 (26) "Qualified high-risk pool" has the same meaning given that
16 term in the Health Insurance Portability and Accountability Act of 1996;
17 (27) "Qualified trade adjustment assistance eligible person"
18 means a person who is a trade adjustment assistance eligible person as
19 defined by this section and for whom, on the date an application for the
20 individual is received by the pool under � 23-79-509, has an aggregate of at
21 least three (3) months of creditable coverage without a break in coverage of
22 sixty-three (63) days or more;
23 (28) "Resident eligible person" means a person who:
24 (A) Has been legally domiciled in the State of Arkansas
25 for a period of at least:
26 (i) Ninety (90) days and continues to be domiciled
27 in Arkansas; or
28 (ii) Thirty (30) days, continues to be domiciled in
29 Arkansas, and was covered under a qualified high-risk pool in another state
30 up until sixty-three (63) days or less prior to the date that the pool
31 receives his or her application for coverage; and
32 (B) Is not eligible for coverage under:
33 (i) A group health plan;
34 (ii) Part A or Part B of Medicare; or
35 (iii) Medical assistance as defined in this section
36 and does not have other health insurance coverage as defined in this section;
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1 and
2 (29) "Trade adjustment assistance eligible person" means a person
3 who is legally domiciled in the State of Arkansas on the date of application
4 to the pool and is eligible for the tax credit for health insurance coverage
5 premiums under section 35 of the Internal Revenue Code of 1986.
6
7 23-79-504. Arkansas Comprehensive Health Insurance Pool.
8 (a) There is created a nonprofit legal entity to be known as the
9 "Arkansas Comprehensive Health Insurance Pool" as the successor entity to the
10 nonprofit legal entity established by Acts 1995, No. 1339.
11 (b)(1) The pool shall operate subject to the supervision and control
12 of the Board of Directors of the Arkansas Comprehensive Health Insurance
13 Pool. The pool is created as a political subdivision, instrumentality, and
14 body politic of the State of Arkansas, and, as such, is not a state agency.
15 (2) Except to the extent defined in this subchapter, the pool
16 will be exempt from:
17 (A) All state, county, and local taxes;
18 (B) The Arkansas Procurement Law, � 19-11-201 et seq.;
19 (C) The Freedom of Information Act of 1967, � 25-19-101 et
20 seq.; and
21 (D) The Arkansas Administrative Procedure Act, � 25-15-201
22 et seq.
23 (3) The board shall consist of the following seven (7) members
24 to be appointed by the Insurance Commissioner:
25 (A) Two (2) current or former representatives of insurance
26 companies licensed to do business in the State of Arkansas;
27 (B) Two (2) current or former representatives of health
28 maintenance organizations licensed to do business in the State of Arkansas;
29 (C) One (1) member of a health-related profession licensed
30 in the State of Arkansas;
31 (D) One (1) member from the general public who is not
32 associated with the medical profession, a hospital, or an insurer; and
33 (E) One (1) member to represent a group considered to be
34 uninsurable.
35 (4) In making appointments to the board, the commissioner shall
36 strive to ensure that at least one (1) person serving on the board is at
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1 least sixty (60) years of age.
2 (5) All terms shall be for three (3) years.
3 (6) The board shall elect one (1) of its members as chair.
4 (7) Any vacancy in the board occurring for any reason other than
5 the expiration of a term shall be filled for the unexpired term in the same
6 manner as the original appointment.
7 (8) Members of the board may be reimbursed from moneys of the
8 pool for actual and necessary expenses incurred by them in the performance of
9 their official duties as members of the board but shall not otherwise be
10 compensated for their services.
11 (c) All insurers, as a condition of doing business in the State of
12 Arkansas, shall participate in the pool by paying the assessments, submitting
13 the reports, and providing the information required by the board or the
14 commissioner to implement the provisions of this subchapter.
15 (d)(1) Neither the board nor its employees shall be liable for any
16 obligations of the pool.
17 (2) No board member or employee of the board shall be liable,
18 and no cause of action of any nature may arise against them, for any act or
19 omission related to the performance of their powers and duties under this
20 subchapter.
21 (3) The board may provide in its bylaws or rules for
22 indemnification of, and legal representation for, the board members and
23 employees.
24
25 23-79-505. Plan of operation.
26 (a)(1) The Board of Directors of the Arkansas Comprehensive Health
27 Insurance Pool shall adopt a plan of operation pursuant to this subchapter
28 and shall submit to the Insurance Commissioner for approval the plan of
29 operation including the Arkansas Comprehensive Health Insurance Pool's
30 articles, bylaws and operating rules, and any amendments thereto necessary or
31 suitable to assure the fair, reasonable, and equitable administration of the
32 pool. The plan of operation shall become effective upon approval in writing
33 by the commissioner.
34 (2) If the board fails to submit a suitable plan of operation
35 within one hundred eighty (180) days after the appointment of the board of
36 directors, or at any time thereafter fails to submit suitable amendments to
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1 the plan of operation, the commissioner shall adopt and promulgate such rules
2 as are necessary or advisable to effectuate the provisions of this section.
3 The rules shall continue in force until modified by the commissioner or
4 superseded by a plan of operation submitted by the board and approved by the
5 commissioner.
6 (b) The plan of operation shall:
7 (1) Establish procedures for operation of the pool;
8 (2) Establish procedures for selecting a plan administrator in
9 accordance with � 23-79-508;
10 (3) Create a fund, under management of the board, to pay
11 administrative claims and other expenses of the pool;
12 (4) Establish procedures for the handling, accounting, and
13 auditing of assets, moneys, and claims of the pool and the plan
14 administrator;
15 (5) Develop and implement a program to publicize the existence
16 of the plan, the eligibility requirements, and the procedures for enrollment
17 and to maintain public awareness of the plan;
18 (6)(A) Establish procedures under which applicants and
19 participants may have grievances reviewed by a grievance committee appointed
20 by the board. The grievances shall be reported to the board after completion
21 of the review.
22 (B) The board shall retain all written complaints
23 regarding the plan for at least three (3) years; and
24 (7) Provide for other matters as may be necessary and proper for
25 the execution of the board's powers, duties, and obligations under this
26 subchapter.
27
28 23-79-506. Powers.
29 (a)(1) The Arkansas Comprehensive Health Insurance Pool shall have the
30 general powers and authority granted under the laws of the State of Arkansas
31 to health insurers and, in addition thereto, the specific authority to:
32 (A) Enter into contracts as are necessary or proper to
33 carry out the provisions and purposes of this subchapter;
34 (B) Sue or be sued, including taking any legal actions
35 necessary or proper;
36 (C) Take such legal action as necessary, including without
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1 limitation:
2 (i) Avoiding the payment of improper claims against
3 the pool or the coverage provided by or through the pool;
4 (ii) Recovering any amounts erroneously or improperly
5 paid by the pool;
6 (iii) Recovering any amounts paid by the pool as a
7 result of mistake of fact or law;
8 (iv) Recovering other amounts due the pool; or
9 (v) Coordinating legal action with the Insurance
10 Commissioner to enforce the provisions of this subchapter;
11 (D)(i) Establish and modify from time to time as
12 appropriate, rates, rate schedules, rate adjustments, expense allowances,
13 agent referral fees, claim reserve formulas, deductibles, copayments,
14 coinsurance, and any other actuarial function appropriate to the operation of
15 the pool.
16 (ii) Rates and rate schedules may be adjusted for
17 appropriate factors such as age, sex, and geographical variation in claim
18 costs and shall take into consideration appropriate factors in accordance
19 with established actuarial and underwriting practices;
20 (E) Issue policies of insurance in accordance with the
21 requirements of this subchapter. All policy forms shall be subject to the
22 approval of the commissioner;
23 (F) Authorize the plan administrator to prepare and
24 distribute certificate of eligibility forms and enrollment instruction forms
25 to agents and to the general public;
26 (G) Provide and employ cost-containment measures and
27 requirements, including without limitation preadmission screening, second
28 surgical opinion, concurrent utilization review, and individual case
29 management for the purposes of making the plan more cost effective;
30 (H) Design, utilize, contract, or otherwise arrange the
31 delivery of cost-effective healthcare services, including establishing or
32 contracting directly or through the plan administrator with preferred
33 provider organizations, health maintenance organizations, physician hospital
34 organizations, or other limited network provider arrangements;
35 (I) Borrow money to effect the purposes of the pool. Any
36 notes or other evidence of indebtedness of the pool not in default shall be
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1 legal investments for insurers and may be carried as admitted assets;
2 (J) Pledge, assign, and grant a security interest in any
3 of the assessments authorized by this subchapter or other assets of the pool
4 in order to secure any notes or other evidences of indebtedness of the pool;
5 (K) Provide reinsurance of risks incurred by the pool;
6 (L) Provide additional types of plans to provide optional
7 coverages, including Medicare supplement health insurance and health savings
8 accounts that comply with applicable federal law as in effect January 1,
9 2005;
10 (M) Enter into reciprocal agreements with other comparable
11 state plans in order to provide coverage for persons who move between states
12 and are covered by such other states' plans; and
13 (N) Establish lifetime maximum benefits under � 23-79-
14 510(a)(2)(W) for any person covered by a plan.
15 (2) In addition to the other powers granted by the Arkansas
16 Insurance Code, the commissioner may impose, after notice and hearing in
17 accordance with the provisions of the Arkansas Insurance Code, a monetary
18 penalty upon any insurer or suspend or revoke the certificate of authority to
19 transact insurance in the State of Arkansas of any insurer that fails to pay
20 an assessment or otherwise file any report or furnish information required to
21 be filed with the Board of Directors of the Arkansas Comprehensive Health
22 Insurance Pool pursuant to the board's direction that the board believes is
23 necessary in order for the board to perform its duties under this subchapter.
24 (b) All outstanding contracts executed by the Board of Directors of
25 the State Comprehensive Health Insurance Pool created by Acts 1995, No. 1339,
26 shall be deemed continuing obligations of the board created by this
27 subchapter.
28 (c) As provided for in � 23-79-502, any health insurance benefit not
29 provided for in this subchapter shall be deemed to be in conflict with and
30 therefore inapplicable to the provisions of this subchapter.
31
32 23-79-507. Funding of pool.
33 (a) Premiums.
34 (1)(A) The Arkansas Comprehensive Health Insurance Pool shall
35 establish premium rates for plan coverage as provided in subdivision (a)(2)
36 of this section.
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1 (B) Separate schedules of premium rates based on age, sex,
2 and geographical location may apply for individual risks.
3 (C) Premium rates and schedules shall be submitted to the
4 Insurance Commissioner for approval prior to use.
5 (2)(A)(i) With the assistance of the commissioner, the pool
6 shall determine a standard risk rate by considering the premium rates charged
7 by other insurers offering health insurance coverage to individuals in
8 Arkansas.
9 (ii) The standard risk rate shall be established
10 using reasonable actuarial techniques and shall reflect anticipated
11 experience and expenses for the coverage.
12 (B)(i) Rates for plan coverage shall not exceed one
13 hundred fifty percent (150%) of rates established as applicable for
14 individual standard risks in Arkansas.
15 (ii) Subject to the limits provided in this
16 subdivision (a)(2), subsequent rates shall be established to help provide for
17 the expected costs of claims, including recovery of prior losses, expenses of
18 operation, investment income of claim reserves, and any other cost factors
19 subject to the limitations described in this section.
20 (b) Sources of Additional Revenue.
21 (1) In addition to the powers enumerated in � 23-79-506, the
22 pool shall have the authority to:
23 (A) Assess insurers in accordance with the provisions of
24 this section; and
25 (B)(i) Make advance interim assessments as may be
26 reasonable and necessary for the pool's organizational and interim operating
27 expenses.
28 (ii) Any such interim assessments may be credited as
29 offsets against any regular assessments due following the close of the fiscal
30 year.
31 (2)(A) Following the close of each fiscal year, the plan
32 administrator shall determine the net premiums, that is, premiums less
33 administrative expense allowances, the pool expenses of administration and
34 operation, and the incurred losses for the year, taking into account
35 investment income and other appropriate gains and losses.
36 (B) The deficit incurred by the pool not otherwise
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1 recouped under either subdivision (b)(9) of this section or subsection (e) of
2 this section [repealed], or both, shall be recouped by assessments
3 apportioned among insurers by the Board of Directors of the Arkansas
4 Comprehensive Health Insurance Pool.
5 (3) Each insurer's assessment shall be determined by multiplying
6 the total assessment of all insurers as determined in subdivision (b)(2) of
7 this section by a fraction, the numerator of which equals that insurer's
8 premium and subscriber contract charges for health insurance written in the
9 state during the preceding calendar year and the denominator of which equals
10 the total of all health insurance premiums by all insurers.
11 (4)(A) If assessments or other funds received under either
12 subdivision (b)(9) of this section or subsection (e) of this section
13 [repealed], or both, or any combination of the assessments and funds exceed
14 the pool's actual losses and administrative expenses, the excess shall be
15 held at interest and used by the board to offset future losses or to reduce
16 future assessments.
17 (B) As used in this subsection, "future losses" includes
18 reserves for incurred but not reported claims.
19 (5) Each insurer's assessment shall be determined annually by
20 the board based on annual statements and other reports deemed necessary by
21 the board and filed by the insurer with the board or the commissioner.
22 (6)(A)(i) An insurer may petition the commissioner for an
23 abatement or deferment of all or part of an assessment imposed by the board.
24 (ii) The commissioner may abate or defer, in whole or
25 in part, the assessment if, in the opinion of the commissioner, payment of
26 the assessment would endanger the ability of the insurer to fulfill its
27 contractual obligations.
28 (B)(i) In the event an assessment against an insurer is
29 abated or deferred, in whole or in part, the amount by which the assessment
30 is abated or deferred shall be assessed against the other insurers in a
31 manner consistent with the basis for assessments set forth in this
32 subsection.
33 (ii) The insurer receiving the abatement or deferment
34 shall remain liable to the plan for the deficiency for four (4) years.
35 (7) For all assessments issued by the board, beginning January
36 1, 1998, only those individuals, corporations, associations, or other
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1 entities defined as an insurer in � 23-79-503 shall be subject to assessment.
2 (8) In the event the board fails to act within a reasonable
3 period of time to recoup by assessment any deficit incurred by the pool, the
4 commissioner shall have all the powers and duties of the board under this
5 chapter with respect to assessing insurers.
6 (9) The General Assembly further intends that the pool be
7 eligible for, and for the pool, its board, or other officers of state
8 government, as appropriate, to take steps necessary to obtain federal grant
9 funds to offset losses of the pool, including any funds made available under
10 the Trade Adjustment Assistance Reform Act of 2002.
11 (c) Assessment Offsets.
12 (1) Any assessment may be offset in an amount equal to the
13 amount of the assessment paid to the pool against the premium tax payable by
14 that insurer for the year in which the assessment is levied or for the four
15 (4) years subsequent to that year.
16 (2) No offset shall be allowed for any penalty assessed under
17 subdivision (d)(1) of this section.
18 (d)(1) All assessments and fees shall be due and payable upon receipt
19 and shall be delinquent if not paid within thirty (30) days of the receipt of
20 the notice by the insurer.
21 (2) Failure to timely pay the assessment will automatically
22 subject the insurer to a ten percent (10%) penalty, which will be due and
23 payable within the next thirty-day period.
24 (3) The board and the commissioner shall have the authority to
25 enforce the collection of the assessment and penalty in accordance with the
26 provisions of this subchapter and the Arkansas Insurance Code.
27 (4) The board may waive the penalty authorized by this
28 subsection if it determines that compelling circumstances exist that justify
29 such a waiver.
30
31 23-79-508. Plan administrator.
32 (a) The Board of Directors of the Arkansas Comprehensive Health
33 Insurance Pool shall select an insurer through a competitive bidding process
34 to administer the plan. However, the administering insurer designated by the
35 board created by Acts 1995, No. 1339, shall serve as the plan administrator
36 under this subchapter until the expiration of the current contract of the
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1 administering insurer. The board shall evaluate bids submitted under this
2 section based upon criteria established by the board which shall include, but
3 not be limited to, the following:
4 (1) The plan administrator's proven ability to handle large
5 group accident and health benefit plans;
6 (2) The efficiency and timeliness of the plan administrator's
7 claim processing procedures;
8 (3) An estimate of total charges for administering the plan;
9 (4) The plan administrator's ability to apply effective cost
10 containment programs and procedures and to administer the plan in a cost
11 efficient manner; and
12 (5) The financial condition and stability of the plan
13 administrator.
14 (b)(1) The plan administrator shall serve for a period of three (3)
15 years subject to removal for cause and subject to the terms, conditions, and
16 limitations of the contract between the board and the plan administrator.
17 (2) The board shall advertise for and accept bids to serve as
18 the plan administrator for the succeeding three-year periods.
19 (c) The plan administrator shall perform functions related to the plan
20 as may be assigned to it, including:
21 (1) Determination of eligibility;
22 (2) Payment and processing of claims;
23 (3) Establishment of a premium billing procedure for collection
24 of premiums. Billings shall be made on a periodic basis as determined by the
25 board; and
26 (4) Other necessary functions to assure timely payment of
27 benefits to covered persons under the plan, including:
28 (A) Making available information relating to the proper
29 manner of submitting a claim for benefits under the plan and distributing
30 forms upon which submissions shall be made; and
31 (B) Evaluating the eligibility of each claim for payment
32 under the plan.
33 (d)(1) The plan administrator shall submit regular reports to the
34 board regarding the operation of the plan.
35 (2) Frequency, content, and form of the report shall be
36 determined by the board.
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1 (e)(1) The plan administrator shall pay claim expenses from the
2 premium payments received from or on behalf of plan participants and
3 allocated by the board for claim expenses.
4 (2) If the plan administrator's payments for claims expenses
5 exceed the portion of premiums allocated by the board for payment of claims
6 expenses, the board shall provide additional funds to the plan administrator
7 for payment of claims expenses.
8 (f) The plan administrator shall be governed by the requirements of
9 this subchapter and shall be compensated as provided in the contract between
10 the board and the plan administrator.
11
12 23-79-509. Plan eligibility.
13 (a) General Eligibility Requirements. The following requirements
14 apply to a resident eligible person or a trade adjustment assistance eligible
15 person in order for the person to be eligible for plan coverage:
16 (1) Except as provided in subdivision (a)(2) of this section or
17 subsection (b) of this section, any individual person who meets the
18 definition of resident eligible person as defined by � 23-79-503 or a trade
19 adjustment assistance eligible person as defined by � 23-79-503 and is either
20 a citizen of the United States or an alien lawfully admitted for permanent
21 residence who continues to be a resident of this state shall be eligible for
22 plan coverage if evidence is provided of:
23 (A) A notice of rejection or refusal by an insurer to
24 issue substantially similar individual health insurance coverage by reason of
25 the existence or history of a medical condition or upon such other evidence
26 that the Board of Directors of the Arkansas Comprehensive Health Insurance
27 Pool deems sufficient in order to verify that the applicant is unable to
28 obtain the coverage from an insurer due to the existence or history of a
29 medical condition;
30 (B)(i) A refusal by an insurer to issue individual health
31 insurance coverage except at a rate that the board determines is
32 substantially in excess of the applicable plan rate.
33 (ii) A rejection or refusal by a group health plan or
34 insurer offering only stop-loss or excess-of-loss insurance or contracts,
35 agreements, or other arrangements for reinsurance coverage with respect to
36 the applicant shall not be sufficient evidence under this subsection;
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1 (C)(i) Until September 30, 2011, a refusal by an insurer
2 to issue individual health insurance coverage to a child under nineteen (19)
3 years of age.
4 (ii) After September 30, 2011, the eligibility of a
5 child under nineteen (19) years of age for individual health insurance
6 coverage shall be determined by the board; or
7 (D) Evidence that the applicant was covered under a
8 qualified high-risk pool of another state, provided that the coverage
9 terminated no more than sixty-three (63) days prior to the date the pool
10 receives the applicant's application for coverage and the other state's
11 qualified high-risk pool did not terminate the person's coverage for fraud;
12 (2) A person shall not be eligible for coverage under the plan
13 if:
14 (A) The person has or obtains health insurance coverage
15 substantially similar to or more comprehensive than a plan policy or would be
16 eligible to have coverage if the person elected to obtain it except that:
17 (i) A person may maintain other coverage for the
18 period of time the person is satisfying any waiting period for a preexisting
19 condition under a plan policy; and
20 (ii) A person may maintain plan coverage for the
21 period of time the person is satisfying a waiting period for a preexisting
22 condition under another health insurance policy intended to replace the plan
23 policy;
24 (B) The person is determined to be eligible for healthcare
25 benefits under Title XIX of the Social Security Act;
26 (C) The person has previously terminated plan coverage
27 unless twelve (12) months have elapsed since termination of coverage;
28 (D) The person fails to pay the required premium under the
29 covered person's terms of enrollment and participation, in which event the
30 liability of the plan shall be limited to benefits incurred under the plan
31 for the same period for which premiums had been paid and the covered person
32 remained eligible for plan coverage;
33 (E) The plan has paid on behalf of the covered person the
34 maximum lifetime benefit established by the board in accordance with � 23-79-
35 510(a)(2)(W);
36 (F) The person is a resident of a public institution;
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1 (G) All or part of the person's premium is paid for or
2 reimbursed:
3 (i) By one (1) of the following in connection with a
4 group health plan:
5 (a) The person's current employer;
6 (b) If the person is retired, by the person's
7 former employer; or
8 (c) If the person is a dependent of an
9 employee or retiree, by the current or former employer of the employee or
10 retiree; or
11 (ii) Under any government-sponsored program or by any
12 government agency, foundation, healthcare facility, or healthcare provider
13 except for premiums paid on behalf of:
14 (a) A trade adjustment assistance eligible
15 person or a qualified trade adjustment assistance eligible person in
16 accordance with section 35 of the Internal Revenue Code; or
17 (b) An otherwise qualifying full-time employee
18 or dependent of a qualifying full-time employee of a government agency,
19 foundation, healthcare facility, or healthcare provider; or
20 (H) The person commits a fraudulent insurance act as
21 defined in � 23-66-501(4) against the Arkansas Comprehensive Health Insurance
22 Pool;
23 (3) The board or the plan administrator shall require
24 verification of residency and may require any additional information,
25 documentation, or statements under oath whenever necessary to determine plan
26 eligibility or residency;
27 (4) Coverage shall cease:
28 (A) On the date a person is no longer a resident of the
29 State of Arkansas;
30 (B) On the date a person requests coverage to end;
31 (C) On the death of the covered person;
32 (D) On the date state law requires cancellation of the
33 policy; or
34 (E) At the plan's option, thirty (30) days after the plan
35 makes any written inquiry concerning a person's eligibility or place of
36 residence to which the person does not reply; and
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1 (5) Except under the conditions set forth in subdivision (a)(4)
2 of this section, the coverage of any person who ceases to meet the
3 eligibility requirements of this section terminates at the end of the month
4 that the person ceases to meet the eligibility requirements of this section.
5 (b) Persons Eligible for Guaranteed Issuance of Coverage. The
6 following requirements apply to a federally eligible individual or a
7 qualified trade adjustment assistance eligible person in order for such an
8 individual to be eligible for plan coverage:
9 (1) Notwithstanding the requirements of subsection (a) of this
10 section, any federally eligible individual or a qualified trade adjustment
11 assistance eligible person for whom a plan application and such enclosures
12 and supporting documentation as the board may require is received by the
13 board within sixty-three (63) days after the termination of prior creditable
14 coverage for reasons other than nonpayment of premium or fraud that covered
15 the applicant shall qualify to enroll in the plan under the portability
16 provisions of this subsection;
17 (2) Any individual seeking plan coverage under this subsection
18 must submit with his or her application evidence, including acceptable
19 written certification of previous creditable coverage, that will establish to
20 the board's satisfaction that he or she meets all of the requirements to be a
21 federally eligible individual or a qualified trade adjustment assistance
22 eligible person and is currently and permanently residing in the State of
23 Arkansas as of the date his or her application was received by the board;
24 (3) A period of creditable coverage shall not be counted, with
25 respect to qualifying an applicant for plan coverage as an individual under
26 this subsection, if after such a period and before the application for plan
27 coverage was received by the board, there was at least a sixty-three-day
28 period during all of which the individual was not covered under any
29 creditable coverage;
30 (4) Any individual who the board determines qualifies for plan
31 coverage under this subsection shall be offered his or her choice of
32 enrolling in one (1) of the alternative portability plans that the board is
33 authorized under this subsection to establish for those individuals;
34 (5)(A)(i) The board shall offer a choice of healthcare coverages
35 consistent with major medical coverage under the alternative plans authorized
36 by this subsection to every individual qualifying for coverage under this
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1 subsection.
2 (ii) The coverages to be offered under the plans, the
3 schedule of benefits, deductibles, copayments, coinsurance, exclusions, and
4 other limitations shall be approved by the board.
5 (B) One (1) optional form of coverage shall be comparable
6 to comprehensive health insurance coverage offered in the individual market
7 in the State of Arkansas or a standard option of coverage available under the
8 individual health insurance laws of the State of Arkansas. The standard plan
9 that is authorized by � 23-79-510 may be used for this purpose.
10 (C) The board also may offer a preferred provider option
11 and such other options as the board determines may be appropriate for
12 individuals who qualify for plan coverage pursuant to this subsection;
13 (6) Notwithstanding the requirements of � 23-79-510(f), any plan
14 coverage that is issued to individuals who qualify for plan coverage pursuant
15 to the portability provisions of this subsection shall not be subject to any
16 preexisting conditions exclusion, waiting period, or other similar limitation
17 on coverage;
18 (7) Individuals who qualify and enroll in the plan pursuant to
19 this subsection shall be required to pay such premium rates as the board
20 shall establish and approve in accordance with the requirements of � 23-79-
21 507(a);
22 (8) The total premium, without regard to any subsidy of premium,
23 for individuals who qualify and enroll in the plan pursuant to this
24 subsection shall not be greater than a similarly situated individual
25 qualifying for pool coverage under subsection (a) of this section; and
26 (9) A federally eligible individual who qualifies and enrolls in
27 the plan pursuant to this subsection must continue to satisfy all of the
28 other eligibility requirements of this subchapter to the extent not
29 inconsistent with the Health Insurance Portability and Accountability Act of
30 1996 in order to maintain continued eligibility for coverage under the plan.
31 (c) Any person who was issued a policy pursuant to the provisions of
32 Acts 1995, No. 1339, shall be deemed continuously covered consistent with the
33 terms of this subchapter and reissued a new policy in accordance with the
34 provisions of this subchapter.
35
36 23-79-510. Outline of benefits.
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1 (a)(1) Subject to the contractual policy form language adopted by the
2 Board of Directors of the Arkansas Comprehensive Health Insurance Pool,
3 expenses for the following services, supplies, drugs, or articles when
4 prescribed by a physician and determined by the plan to be medically
5 necessary shall be covered, subject to provisions of subsection (b) of this
6 section:
7 (A) Hospital services;
8 (B) Professional services for the diagnosis or treatment
9 of injuries, illnesses, or conditions, other than mental or dental, that are
10 rendered by a physician or by other licensed professionals at his or her
11 direction;
12 (C) Drugs requiring a physician's prescription;
13 (D) Skilled nursing services of a licensed skilled nursing
14 facility for not more than one hundred twenty (120) days during a policy
15 year;
16 (E) Services of a home health agency up to a maximum of
17 two hundred seventy (270) services per year;
18 (F) Use of radium or other radioactive materials;
19 (G) Oxygen;
20 (H) Prostheses other than dental;
21 (I) Rental of durable medical equipment, other than
22 eyeglasses and hearing aids, for which there is no personal use in the
23 absence of the conditions for which such equipment is prescribed;
24 (J) Diagnostic X rays and laboratory tests;
25 (K) Oral surgery for excision of partially or completely
26 unerupted, impacted teeth or the gums and tissues of the mouth when not
27 performed in connection with the extraction or repair of teeth;
28 (L) Services of a physical therapist;
29 (M) Emergency and other medically necessary transportation
30 provided by a licensed ambulance service to the nearest facility qualified to
31 treat a covered condition;
32 (N) Services for diagnosis and treatment of mental and
33 nervous disorders or chemical and drug dependency, provided that a covered
34 person shall be required to make a fifty percent (50%) copayment and that the
35 plan's payment shall not exceed four thousand dollars ($4,000) annually; and
36 (O) Such additional benefits deemed appropriate by the
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1 board in accordance with the provisions of subsection (b) of this section.
2 (2) Exclusions. Unless the contractual policy form language
3 adopted by the board provides otherwise, the following services, supplies,
4 drugs, or articles whether or not prescribed by a physician, shall not be
5 covered:
6 (A) Any charge for treatment for cosmetic purposes other
7 than surgery for the repair or treatment of an injury or a congenital bodily
8 defect to restore normal bodily functions;
9 (B) Care that is primarily for custodial or domiciliary
10 purposes;
11 (C) Any charge for confinement in a private room to the
12 extent it is in excess of the institution's charge for its most common
13 semiprivate room unless a private room is medically necessary;
14 (D) That part of any charge for services rendered or
15 articles prescribed by a physician, dentist, or other healthcare personnel
16 that exceeds the prevailing charge in the locality or for any charge not
17 medically necessary;
18 (E) Any charge for services or articles the provision of
19 which is not within the scope of authorized practice of the institution or
20 individual providing the services or articles;
21 (F) Any expense incurred prior to the effective date of
22 coverage by the plan for the person on whose behalf the expense is incurred;
23 (G) Dental care except as provided in subdivision
24 (a)(1)(K) of this section;
25 (H) Eyeglasses and hearing aids;
26 (I) Illness or injury due to acts of war;
27 (J) Services of blood donors and any fee for failure to
28 replace the first three (3) pints of blood provided to a covered person each
29 policy year;
30 (K) Personal supplies or services provided by a hospital
31 or nursing home or any other nonmedical or nonprescribed supply or service;
32 (L) Any expense or charge for services, articles, drugs,
33 or supplies that are not provided in accord with generally accepted standards
34 of current medical practice;
35 (M) Any expense for which a charge is not made in the
36 absence of insurance or for which there is no legal obligation on the part of
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1 the patient to pay;
2 (N) Any expense incurred for benefits provided under the
3 laws of the United States and the State of Arkansas, including Medicare and
4 Medicaid and other medical assistance, military service-connected disability
5 payments, medical services provided for members of the armed forces and their
6 dependents or employees of the United States Armed Forces, and medical
7 services financed on behalf of all citizens by the United States;
8 (O) Any expense or charge for in vitro fertilization,
9 artificial insemination, or any other artificial means used to cause
10 pregnancy;
11 (P) Any expense or charge for oral contraceptives used for
12 birth control or any other temporary birth control measures;
13 (Q) Any expense or charge for sterilization or
14 sterilization reversals;
15 (R) Any expense or charge for weight-loss programs,
16 exercise equipment, or treatment of obesity except when certified by a
17 physician as morbid obesity, i.e., at least two (2) times normal body weight;
18 (S) Any expense or charge for acupuncture treatment unless
19 used as an anesthetic agent for a covered surgery;
20 (T) Any expense or charge for organ or bone marrow
21 transplants other than those performed at a hospital with a board-approved
22 organ transplant program that has been designated by the board as a preferred
23 provider organization for that specific organ or bone marrow transplant;
24 (U) Any expense or charge for procedures, treatments,
25 equipment, or services that are provided in special settings for research
26 purposes or in a controlled environment, are being studied for safety,
27 efficiency, and effectiveness, and are awaiting endorsement by the
28 appropriate national medical specialty college for general use within the
29 medical community;
30 (V) Such additional exclusions deemed appropriate by the
31 board in accordance with the provisions of subsection (b) of this section;
32 and
33 (W)(i) Any benefits that exceed the maximum lifetime
34 benefit for plan coverage established by the board under � 23-79-
35 506(a)(1)(N).
36 (ii) The maximum lifetime benefit shall not be less
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1 than one million dollars ($1,000,000) and shall not exceed three million
2 dollars ($3,000,000).
3 (b) In establishing the plan coverage, the board shall take into
4 consideration the levels of health insurance provided in the state and
5 medical economic factors as may be deemed appropriate and promulgate
6 benefits, deductibles, copayments, coinsurance factors, exclusions, and
7 limitations determined to be generally reflective of and commensurate with
8 health insurance provided through a representative number of large employers
9 in the state.
10 (c) The board may adjust any deductibles, copayments, and coinsurance
11 factors annually according to the medical component of the Consumer Price
12 Index for All Urban Consumers.
13 (d) Nonduplication of Benefits.
14 (1)(A) The pool shall be payer of last resort of benefits
15 whenever any other benefit or source of third-party payment is available.
16 (B) Benefits otherwise payable under plan coverage shall
17 be reduced by all amounts paid or payable through any other health insurance
18 or any other source providing benefits because of a sickness or injury and by
19 all hospital and medical expense benefits paid or payable under any workers'
20 compensation coverage, automobile medical payment, or liability insurance
21 whether provided on the basis of fault or nonfault and by any hospital or
22 medical benefits paid or payable under or provided pursuant to any state or
23 federal law or program.
24 (2) The pool shall have a cause of action against a covered
25 person for the recovery of the amount of benefits paid that are not covered
26 by the pool. Benefits due from the pool may be reduced or refused as a set-
27 off against any amount recoverable under this subdivision (d)(2).
28 (e) Right of Subrogation -- Recoveries.
29 (1)(A) Whenever the pool has paid benefits because of sickness
30 or an injury to any covered person resulting from a third party's wrongful
31 act or negligence or for which an insurance company or self-insured entity is
32 liable in accordance with the provisions of any policy of insurance, and the
33 covered person has recovered or may recover damages from a third party that
34 is liable for damages, the pool shall have the right to recover the benefits
35 it paid from any amounts that the covered person has received or may receive
36 regardless of the date of the sickness or injury or the date of any
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1 settlement, judgment, or award resulting from the sickness or injury.
2 (B) The pool shall be subrogated to any right of recovery
3 the covered person may have under the terms of any private or public
4 healthcare coverage or liability coverage including coverage under a workers'
5 compensation act without the necessity of assignment of claim or other
6 authorization to secure the right of recovery.
7 (C) To enforce its subrogation right, the pool may:
8 (i) Intervene or join in an action or proceeding
9 brought by the covered person or his or her personal representative,
10 including his or her guardian, conservator, estate, dependents, or survivors,
11 against any third party or the third party's insurance carrier or self-
12 insured entity that may be liable; or
13 (ii) Institute and prosecute legal proceedings
14 against any third party or the third party's insurance carrier or self-
15 insured entity that may be liable for the sickness or injury in an
16 appropriate court either in the name of the pool or in the name of the
17 covered person or his or her personal representative including his or her
18 guardian, conservator, estate, dependents, or survivors.
19 (2)(A)(i) If any action or claim is brought by or on behalf of a
20 covered person against a third party or the third party's insurance carrier
21 or self-insured entity, the covered person or his or her personal
22 representative, including his or her guardian, conservator, estate,
23 dependents, or survivors, shall notify the pool by personal service or
24 registered mail of the action or claim and of the name of the court in which
25 the action or claim is brought, filing proof thereof in the action or claim.
26 (ii) The pool may, at any time thereafter, join in
27 the action or claim upon its motion so that all orders of court after hearing
28 and judgment shall be made for its protection.
29 (B) No release or settlement of a claim for damages and no
30 satisfaction of judgment in the action shall be valid without the written
31 consent of the pool to the extent of its interest in the settlement or
32 judgment and of the covered person or his or her personal representative.
33 (3)(A) In the event that the covered person or his or her
34 personal representative fails to institute a proceeding against any
35 appropriate third party before the fifth month before the action would be
36 barred, the pool, in its own name or in the name of the covered person or
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1 personal representative, may commence a proceeding against any appropriate
2 third party for the recovery of damages on account of any sickness, injury,
3 or death to the covered person.
4 (B) The covered person shall cooperate in doing what is
5 reasonably necessary to assist the pool in any recovery and shall not take
6 any action that would prejudice the pool's right to recovery.
7 (C) The pool shall pay to the covered person or his or her
8 personal representative all sums collected from any third party by judgment
9 or otherwise in excess of amounts paid in benefits under the pool and amounts
10 paid or to be paid as costs, attorney's fees, and reasonable expenses
11 incurred by the pool in making the collection or enforcing the judgment.
12 (4)(A)(i) In the event of judgment or award in either a suit or
13 claim against a third party, the court shall first order paid from any
14 judgment or award the reasonable litigation expenses incurred in preparation
15 and prosecution of the action or claim, together with reasonable attorney's
16 fees.
17 (ii) After payment of those expenses and attorney's
18 fees, the court shall apply out of the balance of the judgment or award an
19 amount sufficient to reimburse the pool the full amount of benefits paid on
20 behalf of the covered person under this subchapter, provided that the court
21 may reduce and apportion the pool's portion of the judgment proportionately
22 to the recovery of the covered person.
23 (B)(i) The burden of producing sufficient evidence to
24 support the exercise by the court of its discretion to reduce the amount of a
25 proven charge sought to be enforced against the recovery shall rest with the
26 party seeking the reduction.
27 (ii) The court may consider the nature and extent of
28 the injury, economic and noneconomic loss, settlement offers, comparative or
29 contributory negligence as it applies to the case at hand, hospital costs,
30 physician costs, and all other appropriate costs.
31 (C) The pool shall pay its pro rata share of the
32 attorney's fees based on the pool's recovery as it compares to the total
33 judgment.
34 (D) Any reimbursement rights of the pool shall take
35 priority over all other liens and charges existing under the laws of the
36 State of Arkansas.
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1 (5) The pool may compromise or settle and release any claim for
2 benefits provided under this subchapter or waive any claims for benefits, in
3 whole or in part, for the convenience of the pool or if the pool determines
4 that collection will result in undue hardship upon the covered person.
5 (f) Preexisting Conditions.
6 (1) Except for federally eligible individuals or qualified trade
7 adjustment assistance eligible persons qualifying for plan coverage under �
8 23-79-509(b) or resident eligible persons or trade adjustment assistance
9 eligible persons who qualify for and elect to purchase the waiver authorized
10 in subdivision (f)(2) of this section, plan coverage shall exclude charges or
11 expenses incurred during the first six (6) months following the effective
12 date of coverage as to any condition if:
13 (A) The condition has manifested itself within the six-
14 month period immediately preceding the effective date of coverage in such a
15 manner as would cause an ordinary prudent person to seek diagnosis, care, or
16 treatment; or
17 (B) Medical advice, care, or treatment was recommended or
18 received within the six-month period immediately preceding the effective date
19 of the coverage.
20 (2) Waiver. The preexisting condition exclusions as set forth
21 in subdivision (f)(1) of this section will be waived to the extent to which
22 the resident eligible person or trade adjustment assistance eligible person:
23 (A) Has satisfied similar exclusions under any prior
24 individual health insurance coverage that was involuntarily terminated; and
25 (B)(i) Has applied for plan coverage not later than thirty
26 (30) days following the involuntary termination.
27 (ii) For each resident eligible person or trade
28 adjustment assistance eligible person who qualifies for and elects this
29 waiver, there shall be added on a prorated basis to each payment of premium a
30 surcharge of up to ten percent (10%) of the otherwise applicable annual
31 premium for as long as that individual's coverage under the plan remains in
32 effect or sixty (60) months, whichever is less.
33 (3)(A) Whenever benefits are due from the plan because of
34 sickness or an injury to a covered person resulting from a third party's
35 wrongful act or negligence and the covered person has recovered or may
36 recover damages from a third party or its insurance carrier or self-insured
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1 entity, the plan shall have the right to reduce benefits or to refuse to pay
2 benefits that otherwise may be payable in the amount of damages that the
3 covered person has recovered or may recover regardless of the date of the
4 sickness or injury or the date of any settlement, judgment, or award
5 resulting from that sickness or injury.
6 (B)(i) During the pendency of any action or claim that is
7 brought by or on behalf of a covered person against a third party or its
8 insurance carrier or self-insured entity, any benefits that would otherwise
9 be payable except for the provisions of this subsection shall be paid if
10 payment by or for the third party has not yet been made and the covered
11 person or, if capable, that person's legal representative agrees in writing
12 to pay back properly the benefits paid as a result of the sickness or injury
13 to the extent of any future payments made by or for the third party for the
14 sickness or injury.
15 (ii) This agreement is to apply whether or not
16 liability for the payments is established or admitted by the third party or
17 whether those payments are itemized.
18 (C) Any amounts due the plan to repay benefits may be
19 deducted from other benefits payable by the plan after payments by or for the
20 third party are made.
21 (4) Benefits due from the plan may be reduced or refused as an
22 offset against any amount otherwise recoverable under this section.
23
24 23-79-511. Confidentiality.
25 (a)(1) All steps necessary under state and federal law to protect
26 confidentiality of applicants and covered persons shall be undertaken by the
27 Board of Directors of the Arkansas Comprehensive Health Insurance Pool to
28 prevent the identification of individual records of covered persons under the
29 plan, rejected by the plan, or who may become ineligible for further
30 participation in the plan.
31 (2) Procedures shall be written by the board to assure the
32 confidentiality of records of persons covered under, rejected by, or who
33 became ineligible for further participation in the plan when gathering and
34 submitting data to the board or any other entity.
35 (b) Any information submitted to the board by hospitals or any other
36 provider pursuant to this subchapter from which the identity of a particular
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1 individual can be determined shall be privileged and confidential and shall
2 not be disclosed in any manner. The foregoing includes, but shall not be
3 limited to, disclosure, inspection, or copying under the Freedom of
4 Information Act of 1967, � 25-19-101 et seq.
5
6 23-79-512. Collective action.
7 Neither the participation in the plan as insurers, the establishment of
8 rates, forms, or procedures nor any other joint or collective action required
9 by this subchapter shall be the basis of any legal action, criminal or civil
10 liability, or penalty against the plan or any insurer.
11
12 23-79-513. Unfair referral to plan -- Prohibited practices by
13 employers.
14 (a) It shall constitute an unfair trade practice under the Trade
15 Practices Act, � 23-66-201 et seq., for an insurer, agent, broker, or third-
16 party administrator to refer an individual to the Arkansas Comprehensive
17 Health Insurance Pool or arrange for an individual to apply to the pool for
18 the purpose of:
19 (1) Separating the individual from group health insurance
20 coverage provided by a group health plan; or
21 (2) Facilitating enrollment in the pool by any of the following
22 individuals associated with an employer, with the knowledge that the employer
23 intends to pay or is paying all or part of the premium payments owed by the
24 individual for pool coverage:
25 (A) An employee of the employer;
26 (B) A retired employee of the employer; or
27 (C) A dependent of an employee or retired employee of the
28 employer.
29 (b) Because pool coverage is not intended to cover participants who
30 are eligible for a group health plan, an individual described in subdivision
31 (a)(2) of this section is not eligible:
32 (1) For pool coverage if the employer associated with the
33 applicant intends to pay for all or part of the pool premium payments for the
34 individual; or
35 (2) To continue pool coverage if the employer associated with
36 the individual directly or indirectly pays all or part of the pool premium
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1 payments for the individual.
2
3 23-79-514. [Repealed.]
4
5 23-79-515. Orderly cessation of operations.
6 (a)(1) The Arkansas Comprehensive Health Insurance Pool shall cease
7 enrollment and coverage under the plan on and after January 1, 2014, as
8 required by federal law.
9 (2) After taking all reasonable steps, including those specified
10 in this section, to timely and efficiently assist in the transition of
11 individuals receiving plan coverage to the individual health insurance
12 market, the Board of Directors of the Arkansas Comprehensive Health Insurance
13 Pool shall cease operating the pool after paying health insurance claims for
14 plan coverage and meeting all other obligations of the board under this
15 section.
16 (b) The board may take all actions it deems necessary to:
17 (1) Cease enrollment for plan coverage effective December 1,
18 2013;
19 (2)(A) Terminate all existing plan coverage effective at the end
20 of the calendar day on December 31, 2013.
21 (B) The board shall provide at least ninety (90) days
22 notice to current policyholders of the termination; and
23 (3) Amend plan policies and provide adequate notice to
24 policyholders, agents, and providers that to be paid or reimbursed, a claim
25 for plan services is required to be filed by the earlier of one hundred
26 eighty (180) days after plan coverage ends or three hundred sixty-five (365)
27 days after the date of service giving rise to the claim.
28 (c) This section does not require the board to revise plan benefits to
29 comply with federal law or to maintain plan coverage for any individual after
30 December 31, 2013.
31 (d)(1) After all plan coverage terminates under this section, the
32 board shall take reasonable steps to wind up all significant operations of
33 the pool by December 31, 2014.
34 (2) Notwithstanding any other provision of this subchapter, to
35 facilitate an efficient cessation of operations:
36 (A) The board may continue to use existing contractors
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1 until cessation of operations without the need to issue competitive requests
2 for proposals;
3 (B) The board may continue to fund operations of this
4 subchapter under � 23-79-507;
5 (C) The board shall remain in effect:
6 (i) As provided by � 23-79-504(b); and
7 (ii) Until a judgment, order, or decree in any
8 action, suit, or proceeding commenced against or by the pool is fully
9 executed; and
10 (D)(i) The term of each current board member shall be
11 extended until the date the pool concludes all business as provided under
12 this section and the Insurance Commissioner certifies the cessations of
13 operations under subsection (g) of this section.
14 (ii) The term of a board member expires when the
15 commissioner certifies the cessations of operations under subsection (g) of
16 this section.
17 (e) On or before June 30, 2013, the board shall amend the plan of
18 operation to reflect the actions necessary to implement this section.
19 (f) If the board has excess funds after the cessation of operations of
20 the pool, the funds shall be returned to the general revenue funds of the
21 state.
22 (g)(1) On or before March 1, 2016, or a later date if necessary to
23 complete the cessation of operations of the pool, the board shall file a
24 report with the General Assembly and commissioner that reflects completion of
25 the requirements of this section and includes an independent auditor's report
26 on the financial statements of the pool.
27 (2) If satisfied upon review of the report that the board has
28 complied with this section and accomplished the pool's cessation of
29 operations in a reasonable manner, the commissioner shall certify that the
30 business of the pool has concluded in accordance with this section and
31 publish the certification on the State Insurance Department website.
32 (h) Upon certification under subsection (g) of this section, the
33 operations of the pool are suspended indefinitely unless reactivated by the
34 General Assembly.
35 (i) The commissioner may address any matters regarding the pool
36 arising after the certification under subsection (g) of this section, and the
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1 Attorney General shall defend a legal action filed after the certification,
2 including seeking the dismissal of the action under � 23-79-516 or for any
3 other purpose.
4 (j) Unless inconsistent with this section, the remainder of this
5 subchapter continues to apply to the pool and the board.
6
7 23-79-516. Statute of limitations and repose.
8 Because winding up the operations of the Arkansas Comprehensive Health
9 Insurance Pool requires the expeditious determination of its outstanding
10 liabilities, a cause of action against the pool or the Board of Directors of
11 the Arkansas Comprehensive Health Insurance Pool shall be commenced within
12 the earlier of one (1) year after the cause of action accrues or December 31,
13 2015.
14
15 23-79-517. Individuals moving to Arkansas and previously covered by
16 another qualified high-risk pool.
17 (a) Notwithstanding � 23-79-510(f), if a resident eligible person is
18 eligible for plan coverage because the person previously was covered under a
19 qualified high-risk pool of another state, a preexisting condition exclusion
20 otherwise applicable to the resident eligible person:
21 (1) Shall be reduced by each month of coverage in which the
22 resident eligible person was subject to a preexisting condition exclusion in
23 the other state's qualified high-risk pool; or
24 (2) Does not apply if the resident eligible person was not
25 subject to a preexisting condition exclusion in the other state's qualified
26 high-risk pool.
27 (b) This section expires on the last day an individual may be enrolled
28 into plan coverage under this subchapter.
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35 02/25/2025 1:11:34 PM ANS291Every fact on this page links to its source, starting with the official bill record.