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Begin FAQs
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Q. Can the insurance department force the carrier to reduce my premium?
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A. The Louisiana Department of Insurance does not have the authority to require an insurer to reduce premiums, based on "our opinion" that they might be unfair. Unfortunately, we can only enforce the laws as they are written.
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Q. What are the rules in regards to refunds?
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A. There is nothing in the Louisiana Insurance Code which mandates an insurer to refund premiums upon request, unless the policy specifically provides for such refunds. Premium rates are calculated over a period of coverage, payable in advance and considered "earned" upon receipt of payment. As such, we have no statutory basis to require an insurance company to refund premiums.
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Q. What is a contestable period?
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A. Health insurance, including disability, is issued based upon the answers given to the health questions on the application for coverage. If a loss is incurred within the contestable period (which is generally three years, unless your policy states differently), the insurance company has the right to initiate an investigation of medical history. The insurance company may look for medical history that may have been omitted or misrepresented on the original application. In the event medical history is discovered that would have altered their level of coverage at the time of application, the insurance company has the right to void or amend the policy. By law, any insurer has the right to contest a policy during the contestable period.
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Q. I am currently paying my premium for my disability policy. Why can't I automatically receive my disability benefits upon receiving a form stating I am disabled?
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A. Each disability policy has a section that describes how the insurance carrier defines disability. As an insured, you are responsible for reading your policy upon receipt during the free look period to confirm that you understand what the insurance company would be looking for in a disability claim. At that time, if you have a question about any part of the policy, you should contact your agent or the company for explanations.
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Q. Can my insurance company ask for updated medical status from me if I am currently receiving benefits?
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A. Your health insurance issuer has the right to request frequent updates to determine if you are still disabled according to your policy provisions and definition of disability.
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Q. My disability insurance company is offsetting my disability payments based on "other income"? Are they allowed to do that?
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A. There is nothing in law which prohibits a disability insurer from reducing benefits based on other sources of income that the insured receives. As such, we can only require that the policy clearly details how and when benefits will be reduced. Often, this point is not clarified upon the purchase of a disability policy. As an insured person, you are responsible for examining the policy within the free look period.
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Q. What rate increases are regulated?
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A. The only rate increases regulated by the Office of Health Insurance are those related to Medicare supplemental policies. The two laws addressing these rate increases are LSA R.S. 22:229, which prohibits insurers from increasing rates within the first year of coverage. The allowable exception to this requirement is an increase due to the addition of a newly covered person, a change in age or geographical location of an individual insured, or an increase in the policy benefit level. If the increase is above 20 percent, LSA R.S. 22:215.9 requires an insurer to provide written notification to the insured at least 45 days prior to the effective date of the increase. Finally, no insurer is permitted to unfairly discriminate in the premium rates charged for insured persons having substantially similar insuring risk exposure factors or expense elements.
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Q. With the new Medicare Prescription Drug Program (Part D) set to go into effect in January 2006, what will be required of an employer as far as notification to his employees? Are there any mandates in reference to this?
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A. The Department of Insurance does not regulate employers. However, questions regarding employer responsibilities in reference to Medicare Part D can be directed to the Centers for Medicare & Medicaid Services in Dallas, Texas at (214) 767-4463.
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Q. While working for my employer, I was paying long and short term disability insurance through a certain company. I was terminated less than one month ago from my job due to an injury, for which I recently had surgery. I contacted my employer and the disability insurance company, who are informing me that they will not cover me, since coverage ceased that day I was terminated and that I do not have an additional 30 days because of the fact that I was terminated (as opposed to resigning). Could you please clarify this for me?
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A. There is nothing in law that mandates coverage once employment has been terminated. In most cases, coverage for disability terminates once the policyholder has terminated employment. Please be certain to read your contract language to make sure that the insurer has correctly informed you about your coverage. If for any reason you feel that this needs to be investigated, please feel free to file a complaint with the Department.
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Q. I have had a cancer policy with a particular insurance company for over ten years. During this time, the premium has gone from $56.00 a month to over $200.00 a month and the benefits still remain the same. Can you please explain to me why rate increases such as these take place?
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A. The claims experience and utilization of all individuals insured under a given plan or policy directly affect rates. Although the Department of Insurance does not approve rate increases for health insurance, except for Medicare Supplement, the Department requires that insurers provide the policyholder with written notice of any increase. Insurers must notify the policyholder at least 45 days in advance when the increase is 20% or more. In addition, insurers are prohibited from increasing rates in the first year of coverage, or more often than once every 6 months thereafter, except for increases due to the addition of a newly covered person, a change in age or geographic location of the insured, or an increase in the policy benefit level., or an increase in the policy benefit level.
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Q. My sister has a supplemental cancer insurance policy. She was paying less than $40 a month 5 years ago when she was diagnosed with colon cancer. Since that time, the company supplying her insurance was purchased by another company and the premium has increased every year since then. She now pays over $300 a month! Is this legal?
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A. While there is nothing in law that regulates an increase in premiums for cancer policies based on an individual class, there is a law that prohibits an insured from being singled out for rate increases, because of receipt or notice of any covered claim. So that we can determine why the rates are being raised so rapidly, we recommend that you file a complaint with our Department in order for us to verify that the insurer is in compliance with the law.
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Q. My husband and I are both disabled, under the age of 65 and are currently on Medicare. What HMO (Medicare Advantage) plans and/or Medigap plans are available to us?
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A. Our Senior Health Insurance Information Program has a guide that is available to the public that can help you choose a Medicare supplement policy. Please contact our office at 800-259-5301 to obtain a complimentary copy of the 2005 Medicare Supplement Comparison Guide. Medicare HMOs/Advantage plans can be researched by going to www.medicare.gov. After entering the website, the home page will display helpful links, and allow you to compare health plan options in your area.
Also, please note that there is a significant law for Louisiana residents, which allows an open enrollment period for Medicare supplement insurance to anyone acquiring Medicare Part B regardless of an individual's age. The open enrollment period is the first six (6) months that Medicare Part B is effective. This is particularly important for those individuals acquiring Medicare Part B below the age of 65 by reason of disability or End Stage Renal Disease (ESRD). During this period an insurer can not deny an applicant a Medicare supplement policy or certificate that is currently available for sale in this state, nor discriminate in the pricing of any such policy or certificate due to a person's health status.
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Q. My Mother is 62 years old and is on disability through her former employer. She has been disabled since June 2003 and has maintained medical insurance coverage through COBRA since that time. She was recently notified that she will be dropped from her COBRA plan in June 2004. Private insurance companies will not insure her because she is considered high risk. What can we do?
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A. Your mother should be eligible for participation in the state's HIPAA Pool, which is guaranteed access as long as she applies within 63-days of her COBRA termination date. The HIPAA Plan is administered by the LA Health Plan, which can be reached at www.lahealthplan.org or by calling (800) 736-0947.
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Q. I am a health insurance producer. One of my clients asked me to review their cancer policy to determine whether it would coordinate benefits with their existing group health plan, and thus only pay up to 100% of bills generated. Do group health plans coordinate benefits with cancer policies or do they pay separately, and thus pay above and beyond the cost of the bills generated?
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A. A cancer policy is considered to be a limited benefits policy; therefore, it would not be coordinated with a group health plan. For Group Coordination of Benefits, please be directed to Regulation 32. In order for the insured to verify the amount of benefits payable, they should read the contract language. This will determine the maximum amount payable and any exclusion for the type of cancer stated in the policy. For example, if the group plan pays $80.00 of a $100.00 bill and the cancer policy pays $50.00, the insured would receive an additional $30.00. However, as we know most plans base their payments on usual & customary charges leaving a portion of the bill unpaid. In these cases this is where the cancer policy would benefit to help make up any charges that are not payable by the group health plan. It also helps make up the difference for non-covered charges and expenses.
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Q. My previous dental insurance carrier paid approximately $700 on some orthodontic claims my daughter filed during her course of treatment. My employer has since switched dental carriers and the orthodontist resubmitted his treatment plan to the new carrier, since my daughter's treatment was only halfway completed. The new carrier will only commit to paying $800 instead of the $1500 lifetime maximum because the previous carrier already paid the $700. Is the lifetime maximum in reference to the carrier or the patient?
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A. In order to determine if the maximum benefit under your new policy is $1500.00 with dental treatment beginning while under a previous policy, you would need to review the policy benefit level and limitations. It is possible that it is written in the contract, that the maximum benefit is $1500.00 with the consideration of any payment made by a previous carrier for the same dental treatment. If after reviewing the policy, it is unclear to you what the amount of coverage should be or you feel that the insurer is in error, you may file a complaint with our Department.
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End FAQs |
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