§ 31–3821. Definitions.
For the purposes of this chapter, the term:
(1) “Aggregate attachment point” means the total amount of health claims incurred by a small employer in a policy year for all covered employees and their dependents, and covered by a stop-loss insurance policy, above which the stop-loss insurer incurs a liability for payment under aggregate stop-loss coverage.
(2) “Attachment point” means the claims amount incurred by an insured group beyond which the insurer incurs a liability for payment.
(3) “Commissioner” means the Commissioner of the Department of Insurance, Securities and Banking.
(4) “Expected claims” means the total amount of claims that, in the absence of medical stop-loss insurance, are projected to be incurred by the insured using reasonable and accepted actuarial principles in a policy year.
(5) “Individual attachment point” means the amount of health claims incurred by a small employer in a policy year for an individual employee or dependent of an employee, and covered by a stop-loss insurance policy, above which the stop-loss insurer incurs a liability for payment, under individual stop-loss coverage.
(6) “Stop-loss insurance” means coverage that insures an employer or an employer-sponsored health plan against the risk that:
(A) One claim will exceed a specific dollar amount; or
(B) The entire loss of a self-insurance plan will exceed a specific dollar amount.
§ 31–3822. Stop-loss policy.
(a) An insurer shall not issue or deliver to a small employer, as defined in §31-3301.01(42), a stop-loss insurance policy unless the employer has a fully-insured employee health benefit plan.
(b) Stop-loss insurance is subject to the following:
(1) The policy must be issued to and insure the employer, the trustee, or other sponsor of the plan, or the plan itself, but not the employees, members, or participants;
(2) Payment by the insurer must be made to the employer, trustee, or other sponsor of the plan, or to the plan itself, but not to the employees, members, participants, or health care providers; and
(3) Stop-loss insurance policies issued or renewed after May 2, 2015, shall not contain any of the following provisions:
(A) An individual attachment point for a policy year that is less than $40,000.
(B) An aggregate attachment point for a policy year that is less than the greater of one of the following:
(i) Five thousand dollars times the total number of group members;
(ii) One hundred twenty percent of expected claims; or
(iii) Forty thousand dollars.
(c)(1) A stop-loss insurer shall not exclude any employee or dependent on the basis of an actual or expected health status-related factor.
(2) Health status-related factors include any of the following: health status; medical condition, including both physical and mental illnesses; claims experience; medical history; receipt of health care; genetic information; disability; evidence of insurability, including conditions arising out of acts of domestic violence of the employee or dependent; or any other health status-related factor as determined by the Commissioner.
(d) A stop-loss insurer shall not cancel or not renew a stop-loss insurance policy except if:
(1) The employer has failed to make the required premium payments;
(2) The employer demonstrates fraud or an intentional misrepresentation of material fact under the terms of the stop-loss insurance policy;
(3) The stop-loss insurer has been determined by the Commissioner to be financially impaired; or
(4) The stop-loss insurer ceases to write, issue, or administer new stop-loss insurance policies in the District; provided, that the following conditions are satisfied:
(A) The insurer provides notice to the Commissioner and employer of its intent to cease writing, issuing, or administering new or existing stop-loss insurance policies in the District at least 180 days before the date the insurer seeks to discontinue the coverage; and
(B) The insurer provides the employer at least 180 days advance written notice of its intent to cancel stop-loss insurance coverage beginning from the date of discontinuation provided to the Commissioner pursuant to subparagraph (A) of this paragraph.
(e) If an insurer elects to cancel or not renew an employer’s stop-loss insurance pursuant to subsection (d)(1) of this section, the insurer shall:
(1) Provide the employer notice no less than 30 days before the date of cancellation or expiration of the policy period;
(2) Accept any premium payment by the employer that would satisfy any outstanding amounts owed to the insurer and cure the deficiency giving rise to the cancellation or non-renewal; and
(3) Continue the policy in full force until the date of cancellation or expiration provided in the notice.
(f) Nothing in this section shall be construed to extinguish, limit, or otherwise impair any existing right in law or equity arising under a stop-loss insurance policy.
(g) On April 1, 2015, and on April 1 annually thereafter, a stop-loss insurer shall report to the Commissioner the number of small employer stop-loss policies it had issued and in effect as of December 31 of the previous year. The information in the report shall include new policies issued and policies reissued or renewed in the previous year for groups that have 1 to 50 employees and 51 to 100 employees.
(h) The provisions of this section shall apply to stop-loss insurance policies issued or renewed after May 2, 2015.
(1) Additional standards for employee benefit stop-loss insurance policies; and
(2) Required disclosures to policyholders by an insurance carrier providing employee benefit stop-loss insurance.