SEC. 2712. GUARANTEED RENEWABILITY OF COVERAGE FOR EMPLOYERS IN THE GROUP MARKET.
Title[ Title I\Subtitle A\Sec. 102 Contents
<<NOTE: 42 USC 300gg-12.>>
``(a) In General.--Except as provided in this section, if a health
insurance issuer offers health insurance coverage in the small or large
group market in connection with a group health plan, the issuer must
renew or continue in force such coverage at the option of the plan
sponsor of the plan.
``(b) General Exceptions.--A health insurance issuer may nonrenew or
discontinue health insurance coverage offered in connection with a group
health plan in the small or large group market based only on one or more
of the following:
``(1) Nonpayment of premiums.--The plan sponsor has failed
to pay premiums or contributions in accordance with the terms of
the health insurance coverage or the issuer has not received
timely premium payments.
``(2) Fraud.--The plan sponsor has performed an act or
practice that constitutes fraud or made an intentional
misrepresentation of material fact under the terms of the
coverage.
``(3) Violation of participation or contribution rules.--The
plan sponsor has failed to comply with a material plan provision
relating to employer contribution or group participation rules,
as permitted under section 2711(e) in the case of the small
group market or pursuant to applicable State law in the case of
the large group market.
``(4) Termination of coverage.--The issuer is ceasing to
offer coverage in such market in accordance with subsection (c)
and applicable State law.
``(5) Movement outside service area.--In the case of a
health insurance issuer that offers health insurance coverage in
the market through a network plan, there is no longer any
enrollee in connection with such plan who lives, resides, or
works in the service area of the issuer (or in the area for
which the issuer is authorized to do business) and, in the case
of the small group market, the issuer would deny enrollment with
respect to such plan under section 2711(c)(1)(A).
``(6) Association membership ceases.--In the case of health
insurance coverage that is made available in the small or large
group market (as the case may be) only through one or more bona
fide associations, the membership of an employer in the
association (on the basis of which the coverage is provided)
ceases but only if such coverage is terminated under this
paragraph uniformly without regard to any health status-related
factor relating to any covered individual.
``(c) Requirements for Uniform Termination of Coverage.--
``(1) Particular type of coverage not offered.--In any case
in which an issuer decides to discontinue offering a particular
type of group health insurance coverage offered in the small or
large group market, coverage of such type may be discontinued by
the issuer in accordance with applicable State law in such
market only if--
``(A) the issuer provides notice to each plan
sponsor provided coverage of this type in such market
(and participants and beneficiaries covered under such
coverage) of such discontinuation at least 90 days prior
to the date of the discontinuation of such coverage;
``(B) the issuer offers to each plan sponsor
provided coverage of this type in such market, the
option to purchase all (or, in the case of the large
group market, any) other health insurance coverage
currently being offered by the issuer to a group health
plan in such market; and
``(C) in exercising the option to discontinue
coverage of this type and in offering the option of
coverage under subparagraph (B), the issuer acts
uniformly without regard to the claims experience of
those sponsors or any health status-related factor
relating to any participants or beneficiaries covered or
new participants or beneficiaries who may become
eligible for such coverage.
``(2) Discontinuance of all coverage.--
``(A) In general.--In any case in which a health
insurance issuer elects to discontinue offering all
health insurance coverage in the small group market or
the large group market, or both markets, in a State,
health insurance coverage may be discontinued by the
issuer only in accordance with applicable State law and
if--
``(i) the issuer provides notice to the
applicable State authority and to each plan
sponsor (and participants and beneficiaries
covered under such coverage) of such
discontinuation at least 180 days prior to the
date of the discontinuation of such coverage; and
``(ii) all health insurance issued or
delivered for issuance in the State in such market
(or markets) are discontinued and coverage under
such health insurance coverage in such market (or
markets) is not renewed.
``(B) Prohibition on market reentry.--In the case of
a discontinuation under subparagraph (A) in a market,
the issuer may not provide for the issuance of any
health insurance coverage in the market and State
involved during the 5-year period beginning on the date
of the discontinuation of the last health insurance
coverage not so renewed.
``(d) Exception for Uniform Modification of Coverage.--At the time
of coverage renewal, a health insurance issuer may modify the health
insurance coverage for a product offered to a group health plan--
``(1) in the large group market; or
``(2) in the small group market if, for coverage that is
available in such market other than only through one or more
bona fide associations, such modification is consistent with
State law and effective on a uniform basis among group health
plans with that product.
``(e) Application to Coverage Offered Only Through Associations.--In
applying this section in the case of health insurance coverage that is
made available by a health insurance issuer in the small or large group
market to employers only through one or more associations, a reference
to `plan sponsor' is deemed, with respect to coverage provided to an
employer member of the association, to include a reference to such
employer.
``
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