Health Insurance Benefit Coverage Law Summaries
38-4000 Oregon, Health Insurance Benefit Coverage Law Summaries Oregon's mandated health care law is codified in the Oregon Revised Statutes at Title 56, Chapter 743. Coordination of benefits provisions are located in the Oregon Administrative Rules at Chapter 836, Division 20.
DEFINITIONS
A "small employer" is any person, firm, corporation, partnership, or association actively engaged in business that, on at least 50 percent of its working days during the preceding year, employed no more than 25 eligible employees and no fewer than two eligible employees, the majority of whom are employed in Oregon, and in which a bona fide partnership, independent contractor or employer-employee relationship exists (Sec. 743.730, as amended by S. 210, L. 1999).
"Preexisting conditions provision" means a health benefit plan provision applicable to an enrollee or late enrollee that excludes coverage for services, charges or expenses incurred during a specified period immediately following enrollment for a condition for which medical advice, diagnosis, care or treatment was recommended or received during a specified period immediately preceding enrollment (Sec. 743.730, as amended by S. 210, L. 1999).
WHAT THE EMPLOYER MUST DO
Oregon does not require employers to provide health insurance for their employees. However, if an employer does provide insurance, it must be aware of specific coverage required to be included in health insurance policies and contracts. This coverage is summarized below.
Mental health coverage. --A group health insurance policy providing coverage for hospital or medical expenses must provide coverage for expenses arising from treatment for mental or nervous conditions at the same level as, and subject to limitations no more restrictive than, those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007).
The coverage may be made subject to provisions of the policy that apply to other benefits under the policy, including but not limited to provisions relating to deductibles and coinsurance. Deductibles and coinsurance for treatment in health care facilities or residential programs or facilities may not be greater than those under the policy for expenses of hospitalization in the treatment of other medical conditions. Deductibles and coinsurance for outpatient treatment may not be greater than those under the policy for expenses of outpatient treatment of other medical conditions (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007).
A provider is eligible for reimbursement under this section if (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007):
(1) the provider is approved by the Department of Human Services;
(2) the provider is accredited for the particular level of care where reimbursement is being requested by the Joint Commission on Accreditation of Hospitals or the Commission on Accreditation of Rehabilitation Facilities;
(3) the patient is staying overnight at the facility and is involved in a structured program at least eight hours per day, five days per week; or
(4) the provider is providing a covered benefit under the policy.
Dependent care coverage. --All individual and group health insurance policies providing hospital, medical or surgical expense benefits that include coverage for a family member of the insured must also provide that the health insurance benefits applicable for children in the family are payable with respect to a newly born child of the insured from the moment of birth and an adopted child effective upon placement for adoptions (Sec. 743.707, as amended by Ch. 506, L. 1995).
The coverage of newly born and adopted children must consist of coverage of injury or sickness, including the necessary care and treatment of medically diagnosed congenital defects and birth abnormalities (Sec. 743.707, as amended by Ch. 506 , L. 1995).
Marital status of parents. --Each policy of health insurance must provide the same coverage for the child of an unmarried woman that the child of an insured married person choosing family coverage receives (Sec. 743.721).
Substance abuse coverage. --A group health insurance policy providing coverage for hospital or medical expenses must provide coverage for expenses arising from treatment for chemical dependency, including alcoholism, at the same level as, and subject to limitations no more restrictive than, those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007).
The coverage may be made subject to provisions of the policy that apply to other benefits under the policy, including but not limited to provisions relating to deductibles and coinsurance. Deductibles and coinsurance for treatment in health care facilities or residential programs or facilities may not be greater than those under the policy for expenses of hospitalization in the treatment of other medical conditions. Deductibles and coinsurance for outpatient treatment may not greater than those under the policy for expenses of outpatient treatment of other medical conditions (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007).
A provider is eligible for reimbursement under this section if (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007):
(1) the provider is approved by the Department of Human Services;
(2) the provider is accredited for the particular level of care for which reimbursement is being requested by the Joint Commission on Accreditation of Hospitals or the Commission on Accreditation of Rehabilitation Facilities;
(3) the patient is staying overnight at the facility and is involved in a structured program at least eight hours per day, five days per week; or
(4) the provider is providing a covered benefit under the policy.
Coordination of benefits. --An employer or the insurer, managed care plan, or third-party administrator that manages a health benefit plan for an employer may share the payment of expenses with another benefit plan sponsored by another employer, with the government through Medicare benefits, or with another type of insurance company through automobile or homeowners' insurance (subrogation). To determine which plan has primary responsibility for payment, coordination of benefits (COB) language specifies the order of benefit payments. Preserving cost management initiatives, such as deductibles and coinsurance, is known as maintenance of benefits. The National Association of Insurance Commissioners (NAIC) has established model guidelines for COB which many states apply to insurance companies, HMOs, or other health care benefit providers. Self-insured employee benefit plans are not required to adopt coordination of benefits language; however, most self-insured health plans do specify how they will coordinate benefit payments with other plans.
The following types of plans must specify how benefits will be coordinated: group and blanket health insurance policies delivered or issued for delivery in the state, including Medicare, group-type contracts, no fault and traditional automobile fault insurance, prepaid coverage, or labor-management trusteed plans, labor organization plans, employer organization plans, and employee benefit organization plans. "Plan" does not include individual or family benefits, group hospital indemnity benefits of $100 per day or less, and school accident-type policies (Oregon Administrative Rules Ch. 836, Div. 20, Secs. 700 --765, as authorized by Oregon Revised Statutes Ch. 731 and 743.552).
Order of benefits. --The following priority applies when coordinating health benefit payments (Oregon Administrative Rules Sec. 836-20-735):
(1) Employee/Dependent: Benefits will be paid first by a health benefit plan, HMO, or health insurance policy that covers the individual as an employee, subscriber, or member before a plan or policy that covers the individual as a dependent;
(2) Dependent Child/Birthday Rule: For a dependent child whose parents are not separated or divorced and who is covered by two health benefit plans, HMOs, or health insurance policies, benefits will be paid first by the plan that covers the parent whose birthday month and day is earlier in the calendar year. If both parents have the same birthday, benefits will be paid first by the plan that covered a parent for a longer period of time. If only one plan specifies the birthday rule an d the other plan specifies priority based on the gender of the parent, benefits will be paid first according to the order of benefits specified in the plan without the birthday rule;
(3) Dependent Child/Divorced or Separated Parents: For a dependent child whose parents are separated or divorced and who is covered by two health benefit plans, HMOs, or health insurance policies, benefits will be paid first by the plan that covers the custodial parent, second by the plan of the spouse of the custodial parent, and third by the plan of the noncustodial parent. If a court decree states that one of the parents is responsible for health care expenses of the child, benefits will be paid first by the plan of that parent;
(4) Active/Inactive Employee: Benefits will be paid first by a health benefit plan, HMO, or health insurance policy that covers the individual as an employee who is neither laid off or retired or as that person's dependent before a plan or policy that covers the individual as a laid-off or retired employee or dependent. If only one of the two plans specifies this rule, this standard is ignored;
(5) Longer/Shorter Length of Coverage: Benefits will be paid first by a health benefit plan, HMO, or health insurance policy that has covered the individual as an employee, subscriber, or member for a longer period of time before a plan or policy that covered the individual for a shorter period of time.
Maintenance of benefits. --A plan that pays benefits on a secondary basis may reduce benefits payable to maintain the deductible and coinsurance percentage of the primary plan so long as total benefits paid do not exceed allowable expenses (Oregon Administrative Rules Sec. 836-20-735).
Required language. --Oregon requires group and blanket health insurance policies to have the following language: "BENEFITS SUBJECT TO THIS PROVISION: This coordination of benefits provision applies to this Plan when an employee or the employee's covered dependent has health care coverage under more than one Plan" and delineate the order of benefits. Sample model language is included (Oregon Administrative Rules Sec. 836-20-710).
Providers: Optometrists. --Notwithstanding any provision of any policy of health insurance, whenever the policy provides for reimbursement for any service that is within the lawful scope of practice of a duly licensed optometrist, the insured under the policy is entitled to reimbursement for the service, whether the service is performed by a physician or duly licensed optometrist. Unless the policy provides otherwise, there will be no reimbursement for ophthalmic materials, lenses, spectacles, eyeglasses or appurtenances thereto (Sec. 743.703).
Psychologists. --Whenever any provision of any individual or group health insurance policy or contract provides for payment or reimbursement for any service that is within the lawful scope of a licensed psychologist (Sec. 743.709):
(1) The insured under the policy or contract must be free to select, and must have direct access to, a licensed psychologist, without supervision or referral by a physician or another health practitioner, and wherever the psychologist is authorized to practice.
(2) The insured under the policy or contract must be entitled to have payment or reimbursement made to the insured or on the insured's behalf for the services performed. Payment or reimbursement must be in accordance with the benefits provide d in the policy and must be the same whether performed by a physician or a psychologist.
Nurse practitioners. --Whenever any policy of health insurance provides for reimbursement for any service that is within the lawful scope of practice of a duly licensed and certified nurse practitioner, including prescribing or dispensing drugs, the insured under the policy is entitled to reimbursement for the service whether it is performed by a physician licensed by the Board of Medical Examiners for the State of Oregon or by a duly licensed nurse practitioner. This requirement does not apply to certain group practice health maintenance organizations that are federally qualified (Sec. 743.712).
Dentists. --Notwithstanding any provision of a policy of health insurance, whenever the policy provides for payment of a surgical service, the performance for the insured of the surgical service by any dentist acting within the scope of the dentist's license is compensable if performance of that service by a physician acting within the scope of the physician's license would be compensable (Sec. 743.719).
Denturists. --Notwithstanding any provisions of any policy of insurance covering dental health, whenever the policy provides for reimbursement for any service that is within the lawful scope of practice of a denturist, the insure d is entitled to reimbursement for the service, whether the service is performed by a licensed dentist or a licensed denturist (Sec. 743.713).
Social workers. --Whenever any individual or group health insurance policy or blanket health insurance policy provides for payment or reimbursement for any service that is within the lawful scope of service of a licensed clinical social worker (Sec. 743.714):
(1) the insured is entitled to the services of a licensed clinical social worker, upon referral by a physician or psychologist.
(2) the insured is entitled to have payment or reimbursement made to the insured or on behalf of the insured for the services performed. The payment or reimbursement must be in accordance with the benefits provided in the policy and must be computed in the same manner whether performed by a physician, by a psychologist or by a clinical social worker, according to the customary and usual fee of clinical social workers in the area served.
Acupuncturists. --Whenever any individual or group health insurance policy provides for payment or reimbursement for acupuncture services performed by a physician, the policy also must pay or reimburse the insured for acupuncture services performed by a licensed acupuncturist. The payment or reimbursement must be in accordance with the benefits provided in the policy and must be computed in the same manner whether performed by a physician or an acupuncturist, according to the customary and usual fee of acupuncturists in the area served (Sec. 743.722, as amended by Ch. 79, L. 1995).
Preexisting conditions: Small employers. --A preexisting conditions provision in a small employer health benefit plan will apply only to a condition for which medical advice, diagnosis, care or treatment was recommended or received during the six-month period immediately preceding the enrollment date of an enrollee or late enrollee. A preexisting conditions provision in a small employer health benefit plan will terminate its effect as follows (Sec. 743.737, as amended by H. 3654, L. 2003):
(1) for an enrollee, not later than the first of the following dates: (a) six months following the enrollee's effective date of coverage; or (b) 10 months following the start of any required group eligibility waiting period.
(2) for a late enrollee, not later than 12 months following the late enrollee's effective date of coverage.
In applying a preexisting conditions provision to an enrollee or late enrollee, except as provided below, all small employer health benefit plans must reduce the duration of the provision by an amount equal to the enrollee's or late enrollee's aggregate periods of creditable coverage if the most recent period of creditable coverage is ongoing or ended within 63 days of the enrollment date in the new small employer health benefit plan (Sec. 743.737, as amended by H. 3654, L. 2003).
Late enrollees may be excluded from coverage for up to 12 months or may be subjected to a preexisting conditions provision for up to 12 months. If both an exclusion from coverage period and a preexisting conditions provision are applicable to a late enrollee, the combined period may not exceed 12 months (Sec. 743.737, as amended by H. 3654, L. 2003).
Metabolic disorders. --Group health insurance policies providing coverage for hospital, medical or surgical expenses must include coverage for treatment of inborn errors of metabolism that involve amino acid, carbohydrate and fat metabolism and for which medically standard methods of diagnosis, treatment and monitoring exist, including quantification of metabolites in blood, urine or spinal fluid or enzyme or DNA confirmation in tissues. Coverage must include expenses of diagnosing, monitoring and controlling the disorders by nutritional and medical assessment, including but not limited to clinical visits, biochemical analysis and medical foods used in the treatment of such disorders (Sec. 743.726, as amended by S. 74, L. 2003, effective from July 3, 2003, until July 3, 2009).
Prescription drugs. --No insurance policy or contract providing coverage for a prescription drug to an Oregon resident may exclude coverage of that drug for a particular indication solely on the grounds that the indication has not been approved by the U.S. Food an d Drug Administration if the Health Resources Commission determines that the drug is recognized as effective for the treatment of that indication (Sec. 3, S. 312, L. 1997):
(1) in publications that the commission determines to be equivalent to: The American Hospital Formulary Services drug information; "Drug Facts and Comparisons" (Lippincott-Raven Publishers); The United States Pharmacopoeia drug information; or other publications that have been identified by the U.S. Secretary of Health and Human Services as authoritative;
(2) in the majority of relevant peer-reviewed medical literature; or
(3) by the U.S. Secretary of Health and Human Services.
Nonprescription drugs: Enteral formulas. --All policies providing health insurance, except those policies whose coverage is limited to expenses from accidents or specific diseases that are unrelated to the coverage required by this section, must include coverage for a nonprescription elemental enteral formula for home use, if the formula is medically necessary for the treatment of severe intestinal malabsorption, a physician has issued a written order for the formula, and the formula comprises the sole source, or an essential source, of nutrition (Sec. 743.729).
Medical marijuana. --Oregon's Medical Marijuana Act shall not be construed to require a private health insurer to reimburse a person for costs associated with the medical use of marijuana (Sec. 475.340).
Note: The U.S. Supreme Court, in Gonzales v. Raich, Dkt. No. 03-1454, June 6, 2005, ruled that federal authorities legally may prosecute persons using marijuana under state medical marijuana laws that allow such use.
Mammograms. --Every health insurance policy that covers hospital, medical or surgical expenses, other than coverage limited to expenses from accidents or specific diseases, must provide coverage of mammograms as follows (Sec. 743.727, as amended by S. 588, L. 1999, effective July 1, 1999):
(1) mammograms for the purpose of diagnosis in symptomatic or high-risk women at any time upon referral of the woman's health care provider; and
(2) an annual mammogram for the purpose of early detection for a woman 40 years of age or older, with or without referral from the woman's health care provider.
An insurance policy must not limit coverage of mammograms to the schedule provided as described above if the woman is determined by her health care provider to be at high risk for breast cancer (Sec. 743.727, as amended by S. 588, L. 1999, effective July 1, 1999).
Mastectomy-related services. --All insurers offering a health benefit plan as defined in Sec. 743.730 shall provide payment, coverage or reimbursement for specified mastectomy-related services as determined by the attending physician and enrollee to be part of the enrollee's course or plan of treatment (Sec. 2, H. 3654, L. 2003).
Maternity benefits. --Health benefit plans must provide payment or reimbursement for expenses associated with pregnancy care and childbirth (Sec. 2, H. 2581, L. 1999).
Each policy of health insurance must provide the same payments for costs of maternity to unmarried women that it provides to married women, including the wives of insured persons choosing family coverage (Sec. 743.721).
Diethylstilbestrol (DES). --No policy of health insurance may be denied or canceled by the insurer solely because the mother of the insured used drugs containing diethylstilbestrol prior to the insured's birth (Sec. 743.710).
Diabetes. --Subject to other terms, conditions and benefits in the plan, group health benefit plans must provide payment, coverage or reimbursement for supplies, equipment and diabetes self-management programs associated with the treatment of insulin-dependent diabetes, insulin-using diabetes, gestational diabetes and noninsulin-using diabetes prescribed by a health care professional legally authorized to prescribe such items (Sec. 2, S. 286, L. 2001).
Cervical cancer screenings. --All policies providing health insurance, except those policies whose coverage is limited to expenses from accidents or specific diseases that are unrelated to the coverage required by this section, must include coverage for pelvic examinations and pap smear examinations as follows (Sec. 743.728, as amended by S. 588, L. 1999, effective July 1, 1999):
(1) annually for women 18 to 64 years of age; and
(2) at any time upon referral of the woman's health care provider.
Colorectal cancer screenings. --An insurer offering a health insurance policy that covers hospital, medical or surgical expenses, other than coverage limited to expenses from accidents or specific diseases, shall provide coverage for the following colorectal cancer screening examinations and lab tests (Sec. 6, S. 501, L. 2005, effective January 1, 2006):
(1) for an insured 50 years of age or older: (a) once fecal occult blood test per year plus one flexible sigmoidoscopy every five years; (b) one colonoscopy every 10 years; or (c) one double contrast barium enema every five years.
(2) for an insured who is at high risk for colorectal cancer, colorectal cancer screening examinations and lab tests as recommended by the treating physician.
Eye care. --Any insurer that offers a health benefit plan that provides coverage of eye care services must allow any enrollee to receive covered eye care services on an emergency basis without first receiving a referral or prior authorization from a primary care provider. However, an insurer may require the enrollee to receive a referral or prior authorization from a primary care provider for any subsequent surgical procedures (Sec. 2, S. 16, L. 1999, effective July 1, 2000).
Orthotic and prosthetic devices: Maxillofacial prosthetic services. --All group health insurance policies providing hospital, medical or surgical expense benefits must include coverage for maxillofacial prosthetic services considered necessary for adjunctive treatment (Sec. 743.706).
Utilization review. --Subject to statutory patient or client confidentiality provisions, a group health insurer may provide for review for level of treatment of admissions and continued stays for treatment in health care facilities, residential programs or facilities, day or partial hospitalization programs and outpatient services by either group health insurer staff or personnel under contract to the group health insurer staff or personnel under contract to the group health insurer, or by a utilization review contractor, who shall have the authority to certify for or deny level of payment (Sec. 743.556, as amended by S. 1, L. 2005, effective January 1, 2007).
Emergency care. --All insurers offering a health benefit plan must provide coverage without prior authorization for (Sec. 2, S. 911, L. 1997):
(1) emergency medical screening exams;
(2) stabilization of an emergency medical condition; and
(3) emergency services provided by a nonparticipating provider if a prudent layperson possessing an average knowledge of health and medicine would reasonably believe that the time required to go to a participating provider would place the health of the person, or a fetus in the case of a pregnant woman, in serious jeopardy.
Tourette Syndrome. --For purpose of coverage by group health insurers, health care service contractors and health maintenance organizations, reimbursement for treatment of Tourette Syndrome must be made on the basis of the diagnosis and treatment modality employed (Sec. 743.717).
Genetic testing. --If a person asks an applicant for insurance to take a genetic test in connection with an application for insurance, the use of the test must be revealed to the applicant and the person must obtain the specific authorization of the applicant using a form adopted by the Director of the Department of Consumer and Business Services by rule (Sec. 746.135, as amended by S. 114, L. 2001, effective June 25, 2001).
A person may not use favorable genetic information to induce the purchase of insurance (Sec. 746.135, as amended by S. 114, L. 2001, effective June 25, 2001).
A person may not use genetic information to reject, deny, limit, cancel, refuse to renew, increase the rates of, affect the terms and conditions of or otherwise affect any policy for hospital or medical expenses (Sec. 746.135, as amended by S. 114, L. 2001, effective June 25, 2001).
A person may not use genetic information about a blood relative to reject, deny, limit, cancel, refuse to renew, increase the rates of, affect the terms and conditions of or otherwise affect any policy of insurance (Sec. 746.135, as amended by S. 114, L. 2001, effective June 25, 2001).
A DNA sample from an individual for insurance purposes must be destroyed after the purpose for which the sample was obtained has been accomplished, unless retention is authorized by specific court order (Sec. 659.715, as amended by S. 114, L. 2001, effective June 25, 2001).
Health maintenance organizations. --Each public or private employer in Oregon that offers its employees a health benefit plan and employs not fewer than 25 employees, and each employee benefit fund in Oregon with not fewer than 25 members that offers its members any form of health benefit, must make available to and inform its employees or members of the option to enroll in at least one health maintenance organization that provides health care services in the geographic areas where a substantial number of employees or members reside. Where there is a prevailing collective bargaining agreement, the selection of the HMO to be made available to the employees must be made under the agreement. No employer or benefits fund in Oregon may be required to pay more for health benefits as a result of the application of this section than would otherwise be required by any prevailing collective bargaining agreement or other contract for the provision of health benefits to its employees. No employer or benefits fund need provide an option unless at least 25 employees or members agree to participate in an HMO (Title 51, Ch. 653, Sec. 653.300).
WHO TO CONTACT
Contact the Insurance Division of the Consumer and Business Services Department at 21 Labor and Industries Bldg., Salem OR 97310. Telephone: (503) 378-4271. Fax: (503) 378-6444.
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