Missouri Senate

House Committee Substitute

TRAILER DEALERS - The act also exempts trailer dealers from furnishing copies of current dealer garage liability insurance policies when applying for a trailer dealer license (Section 301.560). This provision of the act is identical to the one contained in HB 2111 (2010) SB 464, SB 357 and HB 365 (2009).

NONRESIDENT FINANCIAL RESPONSIBILITY - Under this act, a nonresident shall not operate a motor vehicle in Missouri unless the nonresident maintains financial responsibility which conforms to the requirements of the laws of the nonresident's state of residence. A nonresident who fails to maintain financial responsibility is guilty of a Class C misdemeanor (Sections 303.025 and 303.040). These provisions are similar to, but not identical to, provisions which can be found in HB 2111 (2010), SCS/SB 902 (2010)and the perfected version of SB 781 (2010).

LICENSING OF BEHAVIOR ANALYSTS, ASSISTANT BEHAVIOR ANALYSTS AND LINE THERAPISTS - The act establishes the Behavior Analyst Advisory Board under the State Committee of Psychologists within the Department of Insurance, Financial Institutions and Professional Registration to establish licensure and registration requirements for behavior analysts, assistance behavior analysts, and line therapists who provide applied behavior analysis therapies for children with autism spectrum disorders (sections 337.300 to 337.340). These provisions are similar to ones in HB 1311 &1341 and HCS/SS/SB 618 (2010).

HEALTH INSURANCE COVERAGE FOR AUTISM - Under this act, health carriers that issue or renew group health benefit plans on or after January 1, 2011, must provide coverage for the diagnosis and treatment of autism spectrum disorders to the extent that such treatment is not already covered by the health benefit plan. The act painstakingly demarcates what constitutes an autism spectrum disorder and that which does not.

The act prohibits health carriers from denying or refusing to issue coverage on, refuse to contract with, or refuse to renew or refuse to reissue or otherwise terminating or restricting coverage on an individual or their dependent because the individual is diagnosed with an autism spectrum disorder (subsection 4). The act sets forth the coverage limits for autism spectrum disorders. Coverage is limited to medically necessary treatment ordered by the insured's treating licensed physician or licensed psychologist, in accordance with a treatment plan (subsection 5). The treatment plan shall include all elements necessary for the health benefit plan or health carrier to pay claims. Such elements include, but are not limited to, a diagnosis, proposed treatment by type, frequency and duration of treatment and goals.

Except for inpatient services, if an individual is receiving treatment for an autism spectrum disorder, a health carrier shall have the right to review the treatment plan not more than once every 3 months unless the health carrier and the individual's treating physician or psychologist agree that a more frequent review is necessary.

Coverage provided by the act for applied behavior analysis is subject to a maximum benefit of $36,000 per year for individuals through 18 years of age (no coverage for applied behavior analysis is required for individuals older than 18 years of age).

Coverage under the act shall not be subject to any limits on the number of visits an individual may make to an autism service provider. The health care services required by the act shall not be subject to any greater deductible, coinsurance or co-payment than other physical health care services provided by a health benefit plan. Coverage of services may be subject to other general exclusions and limitations of the contract or benefit plan, such as coordination of benefits, services provided by family or household members, and utilization review of health care services, including review of medical necessity and care management; however, coverage for treatment under this section shall not be denied on the basis that it is educational or habilitative in nature.

To the extent any payments or reimbursements are being made for applied behavior analysis, such payments or reimbursements shall be made to the autism service providers except for line therapists; the person who is supervising an autism service provider who is also certified as a board certified behavior analyst and licensed by the state of Missouri; or any entity or group for whom such supervising person, who is certified as a board certified behavior analyst by the Behavior Analyst Certification Board, works or is associated (subsection 9).

If a request for qualifications is made by a health carrier of a person who is not licensed as an autism service provider, such person shall provide documented evidence of education and professional training, if any, in applied behavior analysis.

The provisions of act shall not automatically apply to health benefit plan individually underwritten, but shall be offered as an option to any such plan (subsection 16).

The act provides the provisions of the autism mandate shall also apply to the following types of plans that are established, extended, modified or renewed on or after January 1, 2011:

(1) All self-insured governmental plans, as that term is defined in 29 U.S.C. Section 1002(32);

(2) All self-insured group arrangements, to the extent not preempted by federal law;

(3) All plans provided through a multiple employer welfare arrangement, or plans provided through another benefit arrangement, to the extent permitted by the Employee Retirement Income Security Act of 1974, or any waiver or exception to that act provided under federal law or regulation; and

(4) All self-insured school district health plans (subsection 12).

The provisions of the act do not apply to various forms of supplemental insurance policies such as specified disease policies or Medicare supplement policies (subsection 13). The autism mandate shall apply to any health care plans issued to employees and their dependents under the Missouri Consolidated Health Care Plan on or after January 1, 2011 (subsection 11).

Under this act, health carriers are not be required to provide reimbursement for the services delivered by any school-based service (subsection 14). Under the act, the director of the department of insurance must grant a small employer with a group health plan a waiver from the autism insurance mandate if the small employer demonstrates to the director by actual experience over any consecutive 12 month period that compliance with the autism mandate has increased the cost of the health insurance policy by an amount that results in a 2.5% over the period of a calendar year, in premium costs to the small employer (subsection 3). The provisions of the autism mandate do not apply to the MO HealthNet program (subsection 13).

The act requires the department of insurance to submit a n annual report to the General Assembly regarding the implementation of the autism insurance mandate. The report shall include:

(1) The total number of insureds diagnosed with autism spectrium disorder;

(2) The total cost of all claims paid out in the immediately preceding calendar year for PDD;

(3) The cost of such coverage per insured per month; and

(4) The average cost per insured for coverage of applied behavior analysis (section 376.1224).

The autism insurance mandate provisions of the act are similar to provisions contained in HB 1311 & 1341 (2010), SB 618 (2010), SB 167 (2009), HB 2351 (2008), SB 1229 (2008), and SB 1122 (2008).

HEALTH CARE MATERIAL IN ELECTRONIC FORMAT - This act allows an enrollee participating in a health benefit plan to receive documents and materials from a managed care entity in printed or electronic form so long as such documents are readily accessible in printed form upon request. Such requested printed material shall be provided to the enrollee within fifteen business days. This act also allows health maintenance organizations to provide the required disclosure information online unless a paper copy is requested by the enrollee. Such requested paper copy shall be provided to the enrollee within 15 business days. This portion of the act is similar to SB 972 (2010)(Sections 354.442 and 376.1450).

LIFE INSURANCE PRODUCER EXAMINATIONS - This act requires the director of the Department of Insurance or a vendor under contract with the Department of Insurance, to review life insurance producer license examinations if, during a 12-month period beginning on September 1, the examinations show an overall pass rate of less than 70 percent for first-time examinees. The act requires the department to collect demographic information, including, race, gender, and national origin, from an individual taking a producer license examination. The act further requires the department to compile an annual report based on the examination review. The report must indicate whether there was any disparity in the pass rate based on demographic information. The act authorizes the director by rule to establish procedures as necessary to collect demographic information necessary to implement the act and ensure that a review is conducted and the resulting report is prepared. The act also requires the director to deliver the report to the Governor, the Lieutenant Governor, the President Pro tem and the Speaker of the House of Representatives not later than December 1 of each year (Section 375.024). A similar provision may be found in SB 706 (2010).

DETERMINING WHETHER AN INSURANCE COMPANY IS OPERATING IN A HAZARDOUS FINANCIAL CONDITION - This act authorizes the director of the Department of Insurance to determine whether an insurance company is in a hazardous financial condition. Under the act, the director may deem any property or casualty insurance company which has any policy in force with a net retained risk that exceeds 10% of the company's capital and surplus to be in a hazardous financial condition. The act also sets forth twenty factors for the director to consider when determining whether an insurance company may be in hazardous financial condition. For example, the director may consider "adverse findings reported in financial condition and market conduct examination reports, audit reports, and actuarial opinions, reports or summaries" when determining whether the continued operation of the insurer may be hazardous to Missouri's policyholders, creditors, or the general public. If the director determines that the continued operation of an insurer may be hazardous to Missouri' policyholders, creditors or the general public, the director may issue an order requiring the insurer to take various actions. For instance, the director may require the insurer to reduce its total amount of present and potential liability for policy benefits by reinsurance, reduce its volume of business, increase its capital and surplus, or document the adequacy of premium rates in relation to the risks insured. Any insurer subject to an order from the director may request a hearing and the hearing shall be conducted in private unless the insurer requests a public hearing (section 375.539). This provision may also be found in SCS/SB 685 (2010).

RBC TREND TEST - This act modifies Missouri's current law regarding risk-based capital (amount of required capital that the insurance company must maintain based on the inherent risks in the insurer's operations) reporting requirements for property and casualty insurance companies. Under this act, the Department of Insurance may require a property and casualty insurance company to take action if its risk based capital fails the National Association of Insurance Commissioners (NAIC) RBC trend test. The RBC trend test for property and casualty insurance companies is stated in the act as a company action level event where "the insurer has total adjusted capital which is greater than or equal to its Company Action Level RBC but less than the product of its Authorized Control Level RBC and 3.0 triggers the trend test determined in accordance with the trend test calculation included in the Property & Casualty RBC report instructions." Risk-Based Capital tests the adequacy of an insurance company's capital to meet the risks posed by its investment portfolio and the types and volume of insurance it underwrites. Risk-based capital tests the adequacy of an insurance company's capital by comparing its actual capital to the minimum amount capital determined necessary to operate the insurance company based on the risk factors associated with the volume and type of insurance business it transacts and the types of investments it makes (section 375.1255). This provision may also be found in SCS/SB 685 (2010).

INSURERS SUPERVISION, REHABILITATION AND LIQUIDATION ACT - This act amends the "Insurers Supervision, Rehabilitation and Liquidation Act" (Sections 375.1150 to 375.1246), to provide for the treatment of qualified financial contracts in insurance insolvency proceedings. The central purpose of the act is to increase certainty of insurers and their creditors with respect to the enforceability of certain financial market transactions and related netting agreements in the event of an insurer insolvency. To accomplish this, this act adopts certain termination, netting, and liquidation provisions applicable to derivative transactions that are contained in the latest version of the NAIC Insurance Receivership Model Act (IRMA).

The act provides definitions for specific types of financial contracts commonly used in the financial markets, including commodity contracts, forward contracts, qualified financial contracts, and the related netting agreements. As defined in this act, "qualified financial contracts" encompass a range of commonly traded financial market contracts, including over-the counter and exchange traded derivatives, such as swap agreements, forward contracts, securities contracts, repurchase (repo) agreements, and commodity contracts. The act also provides a definition for the term "netting agreement". A "netting agreement" is defined, based upon IRMA, as a contract or agreement that documents one or more transactions between the parties for or involving one or more qualified financial contracts and that provides for the netting or liquidation of qualified financial contracts or present or future payment obligations or payment entitlements thereunder (Section 375.1152).

The act provides for the enforcement and recognition of the contractual rights of the insurer's counterparties under qualified financial contracts, netting agreements, and related security agreements to terminate, accelerate, and close out such contracts, to offset and net off obligations owing under such contracts, and to enforce any security rights under such agreements, free of any stay or prohibition that might otherwise apply under a delinquency proceeding (subsection 3 of Section 375.1155 ). These provisions are similar to ones found in SCS/SB 978 (2010).

VOLUNTARY LIQUIDATION OF DOMESTIC STOCK INSURANCE COMPANIES -

Under this act, a domestic insurer organized as a stock insurance company may voluntarily dissolve and liquidate provided that the director of the Department of Insurance approves the articles of dissolution prior to the insurer's filing of such articles with the Secretary of State and the insurer files with the Secretary of State a copy of the director's approval, certified by the director, along with articles of dissolution.

In determining whether to approve the articles of dissolution, the director shall consider, among other factors, whether:

1) The insurer's annual financial statements filed with the director show no written insurance premiums for 5 years;

2) The insurer has demonstrated that all policyholder claims have been satisfied or have been transferred to another insurer in a transaction approved by the director; and

3) A market conduct examination of the insurer has been completed within the last 5 years (Section 375.1175). This provision is identical the one contained in SCS/SB 834 (2010).

MISSOURI LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ACT - This act updates various provisions of the "Missouri Life and Health Insurance Guaranty Association Act".

The act clarifies that structured settlement annuities are covered by the guaranty association and are subject to a cap of $250,000. The act also provides rules for determining how the responsibility for coverage of these types of annuities is allocated among state guaranty associations (Section 376.717.1(3)).

The act expands the list of areas in which the guaranty association will not provide coverage. Under the act, the guaranty association will not provide coverage for:

1) An obligation that does not arise under the express written terms of the policy or contract issued by the insolvent insurer;

2) Any portion of a policy or contract to the extent that required assessments are preempted by federal or state law;

3) Certain contracts which establish benefits by reference to a portfolio of assets not owned by the insurer;

4) Certain types of indexed policies;

5) A policy providing any hospital, medical, prescription drug or other health care benefits pursuant to Part C or Part D of Subchapter XVIII, Chapter 7 of Title 42 of the United States Code (commonly known as Medicare Part C & D) or any regulations issued thereunder (Section 376.717.3(7)-(12)).

The act adds several clarifying definitions, including the definition of an "owner" of a policy, and the standard for determining the "principal place of business" of a corporation (for the purpose of applying the residency test that determines which state guaranty association has coverage responsibility)(Section 376.718).

The act makes a number of technical changes clarifying the guaranty association's options in providing coverage (Section 376.724); how terminated policies are handled (Section 376.725); the guaranty association's standing to appear or intervene in litigation (Section 376.732); the guaranty association's assignment and subrogation rights (Section 376.733); the guaranty association's general powers and how reinsurance contracts are handled (Section 376.734); how assessments of insurers to fund the guaranty association's operations are handled (Section 376.735 and 376.737); requirements for the association's plan of operation (Section 376.740); and clarifying that the amendments made by the act are prospective only and shall not apply to member insurers that are impaired or insolvent prior to August 28, 2010 (Section 376.758).

The Missouri insurance guaranty association provisions are also contained in SB 900 and HB 1904 (2010).

ADOPTED CHILDREN INSURANCE COVERAGE - Under this act, no health carrier or health benefit plan shall issue or renew a health benefit plan to a Missouri resident unless the health benefit plan covers adopted children of an insured on the same basis as other dependents (section 376.816). This provision can also be found in HB 1713 (2010).

REFUNDING MEDICARE SUPPLEMENT PREMIUMS - Under this act, if a Medicare supplement policy issued, delivered, or renewed in Missouri on or after January 1, 2011, is cancelled for any reason, the insurer must refund the unearned portion of any premium paid beyond the month in which the cancellation is effective. Any refund shall be returned to the policyholder within 20 days from the date the insurer receives notice of the cancellation. Under the act, a policyholder may cancel a Medicare supplement policy by sending verbal, written, or electronic notification (Section 376.882).

REFUNDING LONG-TERM INSURANCE POLICY PREMIUMS - Under this act, if a long-term care insurance policy issued, delivered, or renewed in Missouri on or after January 1, 2011, is cancelled for any reason, the insurer must refund the unearned portion of any premium paid beyond the month in which the cancellation is effective. Any refund shall be returned to the policy holder within 20 days from the date the insurer receives notice of the cancellation.. The long-term care insurance policy must contain notices which inform applicants that they are entitled to a refund of unearned premiums if such policies are cancelled for any reason. Under the act, a policyholder may cancel a long-term care insurance policy by sending verbal, written, or electronic notification (Section 376.1109).

IDENTIFYING INFORMATION IN CERTAIN LEGAL PROCEEDINGS - This act modifies certain requirements about identification information in certain court pleadings, liens, notices of garnishment, and writs of sequestration. Currently, any pleadings other than interlocutory or final judgments in divorce or legal separation cases filed prior to August 28, 2009, shall only be inspected by the parties, an attorney of record, upon order of the court, or in certain circumstances by the Family Support Division of DSS. The clerk is required to redact social security numbers from any judgment or pleading before releasing them to the public. This act modifies these requirements, so that they also apply to pleadings in modification proceedings filed prior to August 28, 2009, and so that licensed title insurers or their designees, will also be allowed to inspect the pleadings in these cases. Those people who are authorized to inspect the pleadings in these cases may also receive or make copies of documents without the clerk being required to redact the Social Security number, unless the court specifically orders the clerk to do otherwise. Also, the clerk will no longer be required to redact the Social Security number from pleadings from cases prior to August 28, 2009, but only from any copy of a judgment or satisfaction of judgment (Section 452.430). This section has an emergency clause. Currently, real estate liens based on unpaid child support or maintenance must include the person's Social Security number. This act requires only the last four digits of the Social Security number on the lien (Section 454.515). This act also changes the requirement that notices of garnishment and writs of sequestration contain the federal taxpayer identification number of a judgment debtor. Only the last four digits of the debtor's federal taxpayer identification number will be required (Section 525.233). These provisions may also be found in SB 985 (2010).

DISSEMINATION OF SCHIP COVERAGE INFORMATION - Under this act, the Department of Social Services is required to provide all state licensed child-care providers that receive federal or state aid and all public school districts written information regarding the eligibility criteria and application procedures for obtaining health insurance coverage through the state children's health insurance program (SCHIPP). This information is to be distributed to the parents at the time of enrollment. The act also requires the department of elementary and secondary education to add an attachment to the application for the free and reduced lunch program which will require the parent to check a box indicating whether the child has health insurance or not. If the child does not have health insurance, and the parent's income does not exceed the highest level established by federal law, the school district shall provide a notice to the parent that the uninsured child may qualify for health insurance coverage under SCHIP. The Department of Elementary and Secondary Education must submit an annual report on the number of families in each district receiving free or reduced lunches, the number of families that indicate the absence of health insurance coverage on such forms, the number of families that received information on the SCHIP program, and the number of families who applied for coverage under the SCHIP program because of the receipt of such information (Section 1).

STEPHEN WITTE