TITLE XXXVII
INSURANCE
Chapter 420-O
SELF-FUNDED STUDENT HEALTH BENEFIT PLANS
Section 420-O:1
420-O:1 Purpose and Scope. –
I. The purpose of this chapter is to set forth standards and procedures for not-for-profit private and public institutions of higher education which provide 4 year bachelor's degree programs and graduate or professional degree programs, and which have a history of providing for the health insurance needs of their students by implementing self-funded student health benefit plans, to obtain authorization to continue this practice.
II. This chapter shall apply only to self-funded student health benefit plans, not to fully-insured student major medical expense coverage, which is governed by RSA 415:19-a and other applicable provisions of Title XXXVII. Nothing in this chapter shall be construed to prohibit an educational institution from purchasing fully-insured student health coverage offered pursuant to RSA 415:19-a.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:2
420-O:2 Definitions. –
In this chapter:
I. "Commissioner" means the insurance commissioner.
II. "Plan document" means evidence of coverage furnished to a student that sets forth all benefits and terms and conditions, with regard to a student health plan.
III. "Qualified actuary" means an actuary who is a member in good standing of the American Academy of Actuaries or Society of Actuaries, with experience in establishing rates for self-insured trusts providing health benefits or other similar experience.
IV. "Institution of higher education" or "institution" means an educational institution in New Hampshire that:
(a) Admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate, or persons who have completed a secondary school education in a home school setting that is treated as a home school or private school under the laws of this state;
(b) Is legally authorized within New Hampshire to provide a program of education beyond secondary education;
(c) Provides an educational program for which the institution awards a bachelor's degree, graduate degree, or professional degree;
(d) Is a public or other nonprofit institution;
(e) Is accredited by a nationally recognized accrediting agency or association; and
(f) Has a history of providing for the health insurance needs of its students through a self-funded student health benefit plan.
V. "Student" means a person enrolled in a degree program in an institution of higher education and may include a postdoctoral fellow.
VI. "Student health plan" or "plan" means any self-funded plan established or maintained by an institution of higher education for the purpose of providing medical, surgical, or hospital services to a student, the student's spouse or domestic partner, the student's child or children, or other persons chiefly dependent upon the student for support and maintenance.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:3
420-O:3 Certificate of Authority. –
I. An institution of higher education shall not establish, maintain, or otherwise participate in a student health plan in this state unless the institution obtains and maintains a certificate of authority from the commissioner pursuant to this chapter.
II. To obtain a certificate of authority, an institution shall file an application on such form as the commissioner may prescribe, and shall provide to the satisfaction of the commissioner the following:
(a) A copy of the student contract, including a table of the premium rates charged or proposed to be charged.
(b) A report indicating the benefit provisions, premium rates or premium equivalents, and incurred medical losses associated with the institution's students under the insurance policy or self-funded plan insuring the institution's students, for the 3 years prior to the date of the application.
(c) The most recent certified independently-audited financial statement for the institution.
(d) A report prepared by a qualified actuary that supports the proposed premiums for the plan.
(e) A copy of all agreements between the institution and any plan administrator, with regard to the student health plan.
(f) A balance sheet, including actuarially determined claims liabilities, and statement of revenue and expenses, including reasonably projected expenses, medical losses, and premiums to be charged to students for the plan during the first 3 years.
(g) A narrative description of the:
(1) Accounting methodology that the institution will utilize, including a description of the separate accounts for revenues and expenses, including medical and hospital expenses and administration expenses, reserves for claims and expenses thereon, including incurred-but-not-reported, unearned premium reserves, contingent reserves, and any asset accounts, including cash, premiums receivable, and investments, relevant to the plan. The accounts may be established within the institution's general accounting ledger system; provided the general ledger accounts are clearly identifiable as pertaining to the plan, including any such accounts allocated to the plan;
(2) Billing and claim payment procedures, including the names and contact information for those persons charged with handling accounting and claims issues; and
(3) Any compensation the institution will receive in connection with the plan.
(h) A copy of any stop-loss insurance policy issued or proposed to be issued by an insurer authorized to do the business of accident and health insurance in this state.
(i) Evidence of the student health plan's recognition as minimum essential coverage by the United States Department of Health and Human Services pursuant to 45 C.F.R. section 156.604.
(j) Such other information as the commissioner may require.
III. To maintain a certificate of authority, an institution shall:
(a) Have on a continuous basis within its own organization adequate resources and competent personnel to administer the student health plan or, in order to provide such administrative services, in whole or part, have contracted with a person or entity to serve as a plan administrator; provided that any such contracted plan administrator shall be in good standing under RSA 402-H or any other requirements of Title XXXVII applicable to administration of the plan.
(b) Establish and maintain premium equivalents sufficient to meet its contractual obligations and to satisfy the reserve requirements set forth in RSA 420-O:5.
(c) Comply with consumer protection requirements under Title XXXVII, including, but not limited to, RSA 420-J, and rules adopted thereunder, RSA 417, and the department's claims processing rules, including the requirements for claims review, network adequacy, dispute resolution, and appeal procedures.
(d) Provide covered students with a copy of the plan document annually.
(e) Maintain recognition of the student health plan as minimum essential coverage in accordance with 45 C.F.R. section 156.604.
(f) File all plan documents, including the plan document, premium equivalents, and any changes in contracts or stop-loss coverage with the commissioner annually at least 60 days prior to the start of the plan year, and receive the commissioner's approval in accordance with Title XXXVII prior to the coverage start date.
(g) File an annual report with the commissioner in accordance with RSA 420-O:6.
IV. Upon compliance by the institution with the requirements under paragraph II, and demonstration of capacity to comply with the requirements of paragraph III, the commissioner may issue a certificate of authority to an applicant. Every certificate of authority shall contain the name of the certified entity and its home office address. The commissioner shall refuse to grant a certificate of authority to an applicant that fails to meet the requirements of this section. The commissioner may refuse to issue any certificate of authority if, in the commissioner's judgment, the refusal will best promote the interests of the people of this state.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:4
420-O:4 Minimum Loss Ratio; Reporting. –
I. A plan under this chapter shall have an expected loss ratio of not less than 85 percent. In reviewing a rate filing or application by a plan, the commissioner may modify the expected minimum loss ratio requirement if the commissioner determines the modification to be in the interests of the people of this state or if the commissioner determines that a modification is necessary to maintain plan solvency.
II. No later than 120 days after the close of a plan's fiscal year, a plan shall annually report the actual loss ratio for the previous plan fiscal year in a format acceptable to the commissioner. If the expected loss ratio is not met, the commissioner may direct the plan to take corrective action. Mandatory uniform student administrative health fees paid by the students irrespective of whether the student is a plan member to an institution shall not be deemed to be included in the premiums paid by students for health benefit coverage under a plan.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:5
420-O:5 Reserves. –
I. An institution shall establish reserves with the amounts necessary to satisfy all contractual obligations and liabilities of the plan, including:
(a) Funds for the payment of claims and expenses thereon reported but not yet paid, and claims and expenses thereon incurred but not yet reported, which shall not be less than an amount equal to 25 percent of expected incurred claims and expenses thereon for the current plan year, unless a qualified actuary has demonstrated to the commissioner's satisfaction that a lesser amount shall be adequate.
(b) Funds for unearned premium equivalents, computed pro-rata on the basis of the unexpired portion of the policy period.
(c) Contingency funds, established and maintained for the sole purpose of satisfying unexpected obligations of the plan in the event of termination of the plan.
II. The reserve statement shall be prepared by a qualified actuary. If at any time the reserve funds required to be established pursuant to this section fall below the required minimum amounts, then the institution shall immediately notify the commissioner of such impairment. The institution shall cure the impairment within 5 business days.
III. The plan's assets, liabilities, income, and expenses shall be accounted for separate and apart from all other assets, liabilities, income, and expenses of the institution.
IV. The requirements for funding of the plan's reserves shall be calculated using generally accepted accounting principles. Only those expenses that relate to the plan shall be included in calculating the requirements for funding of the plan's reserve funds. Expenses allocated to the plan shall be allocated on an equitable basis in conformity with generally accepted accounting principles consistently applied. The books, accounts, and records of the plan shall be maintained to clearly and accurately disclose the nature and details of all expenses to support the reasonableness of such expenses.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:6
420-O:6 Annual Report. –
I. Within 120 days of the close of its fiscal year, an institution of higher education operating under a certificate of authority issued under this chapter shall file with the commissioner a report that contains:
(a) An annual financial statement, verified by the oath of the chief financial officer and at least one of the institution's principal officers with direct knowledge of the operations of the student health plan, showing the financial condition of the plan during the most recent fiscal year, in accordance with law and generally accepted accounting principles, in a form prescribed by the commissioner.
(b) The identity of the qualified actuary utilized by the institution or plan and the amount paid to the qualified actuary by the institution or plan during its most recent fiscal year.
(c) The identities of all vendors involved in plan administration during its most recent fiscal year.
(d) The name and contact information of the person or entity appointed by the institution to administer the student health plan.
(e) A pro-forma statement of projected revenue and expenses for health benefits anticipated by the plan for the next 12-month period of the plan's operation, provided on a fiscal year basis.
(f) A detailed report of the operations and condition of the plan's reserve funds.
(g) Such other information as the commissioner may require.
II. The annual financial statement shall show the financial results of the student health plan operations and a description as to how the institution meets the reserve requirements in RSA 420-O:5, I, the method used to calculate the reserves, and the change in the reserves from the beginning of the plan's fiscal year to the end of the plan's fiscal year. In addition, the annual financial statement shall detail the assets comprising the reserve fund to demonstrate compliance with RSA 420-O:5, I.
III. An institution that fails to file any report or statement required by this chapter, or fails to reply within 30 days to a written inquiry by the commissioner in connection therewith shall, in addition to other penalties provided by this title, be subject, upon due notice and opportunity to be heard, to a penalty of up to $1,000 per day of delay, not to exceed $25,000 in the aggregate, for each such failure.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:7
420-O:7 Examination. –
The commissioner may, pursuant to RSA 400-A:37, make an examination into the affairs of any institution, with regard to a student health plan issued by the institution, as often as the commissioner deems it expedient for the protection of the interests of the people of New Hampshire. The expenses of every examination of the affairs of an institution, with regard to a student health plan established or maintained by the institution, shall be borne and paid by the institution so examined. The expenses of examination shall include reimbursement for the compensation paid for the services of persons employed by the commissioner or by the commissioner's authority to make such examination, and for the necessary traveling and living expenses of the person or persons making the examination.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:8
420-O:8 Investigations; Subpoenas. –
The commissioner may make such investigations as he or she deems necessary both within and outside the state in accordance with the provisions of RSA 400-A:16 and RSA 400-A:20-22.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:9
420-O:9 Suspension or Revocation of Certificate of Authority. –
I. The commissioner may suspend or revoke a certificate of authority issued to an institution under this chapter upon a finding, after notice and hearing, that the institution has failed to comply with any requirement imposed on it under this chapter or necessary to maintain minimum essential coverage status and that in the commissioner's judgment such suspension or revocation is reasonably necessary to protect the interests of the people of this state, including:
(a) For any cause that would be a basis for denial of an initial application for such a certificate;
(b) Failure to maintain the reserves required by RSA 420-O:5; or
(c) The commissioner finds that the institution has refused to produce its accounts, records, and files for examination or has refused to cooperate or give information with respect to the affairs of the student health plan or to perform any other legal obligation relating to such an examination or investigation when required by the commissioner.
II. Any certificate of authority suspended or revoked under this section shall be surrendered to the commissioner, and the institution shall notify all participating students of that decision in such form and manner as the commissioner may prescribe, but not later than 10 days after receipt of notice of the commissioner's decision requiring suspension or revocation. In addition, the institution shall submit a plan for the commissioner's approval for winding up the plan's affairs in an orderly manner designed to result in timely payment of all benefits, in such form and manner as the commissioner may prescribe.
III. All final decisions to suspend or revoke the certificate of authority with regard to an institution shall be public.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:10
420-O:10 Termination of Plan. –
I. In any case in which an institution determines that there is a reason to believe that the student health plan will terminate, the institution shall so inform the commissioner at least 60 days prior thereto, and shall file a sworn statement with the commissioner concerning all current and future liabilities under its discontinued plan. The institution also shall submit a plan for the superintendent's approval for winding up the plan's affairs in an orderly manner designed to result in timely payment of all benefits, in such form and manner as the commissioner may prescribe.
II. Any funds of the institution, as they pertain to the student health plan, shall be accounted for separate and apart from all other assets, liabilities, income, and expenses of the institution until all plan benefits and other plan obligations have been satisfied. Until such time, the institution shall continue to maintain and fund the reserve funds required to be established under RSA 420-O:5. If at any time the commissioner determines that additional funds shall be deposited in the reserve funds, then the institution shall make the deposit within 5 days of the commissioner's determination.
III. If, after 24 months, or such longer period as deemed necessary by the commissioner, all plan benefits and other plan obligations have been satisfied, the institution, upon approval by the commissioner, shall no longer be required to maintain assets within the plan's reserve funds.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:11
420-O:11 Administrative Rules. –
The commissioner may adopt rules under RSA 541-A necessary to implement the provisions of this chapter and to ensure that the plans established under this chapter are in the best interests of the students, students' spouses, students' children, and other persons chiefly dependent upon the students for support and maintenance.
Source. 2016, 257:1, eff. Jan. 1, 2017.
Section 420-O:12
420-O:12 Penalties. –
Any institution of higher education that violates this chapter shall be subject to the penalties set forth in RSA 400-A:15 or such other section of the insurance code as may be applicable, including but not limited to RSA 420-J and RSA 417.
Source. 2016, 257:1, eff. Jan. 1, 2017.