Section 2699.6109 - Participation Requirements for Guaranteed Associations(a) Qualified guaranteed associations shall be eligible to participate in the program to provide health benefits coverage for member employees and individual members. To be a qualified guaranteed association, a guaranteed association shall meet the following requirements: (1) Send a notice to all members of the association, as well as any other person known to the association who although not an association member is in a category of persons who pursuant to (a)(9) below will be eligible for coverage through the guaranteed association, at their last known address that they may elect coverage through the guaranteed association, and that if they meet the qualifications to be a member employer, they may elect to provide coverage for their member employees through the guaranteed association. The notice shall state in bold face type that failure to elect coverage during the enrollment period permits the program to impose, at the time of the employer or person's later decision to elect coverage, an exclusion from coverage until the next open enrollment period, as well as, depending on the participating carrier selected by the person, a six months preexisting condition exclusion once enrolled, unless the individual member can demonstrate that he or she had other employer health coverage during the time of the enrollment period, or has been directed by court order to provide coverage for a spouse or minor child and the person has applied within thirty (30) days of losing that coverage. In addition to the initial notice, such notice shall be provided to all members who later join the guaranteed association and persons who become members of a sponsored category within 30 days of the date they become members of the guaranteed association or sponsored category.(2) Provide all potentially qualified member employers and individual members with at least thirty (30) calendar days to decide whether to apply for coverage through the program.(3) Maintain for a period of one (1) year at the guaranteed association's principal place of business a copy of any notice required by (1) above as well as a list detailing to whom the notice was mailed and when.(4) Not offer coverage anywhere but in the program.(5) Provide coverage in the program to at least 1000 persons except for the following: (A) Sixty (60) days prior to the expiration of an existing plan contract that expires prior to July 1, 1994, or, for plan contracts expiring after July 1, 1994, sixty (60) days prior to July 1, 1994 an association that meets the definition of a guaranteed association pursuant to Section 2699.6000 of this part, except for the requirements that one thousand (1,000) persons be covered, shall be able to participate in the program as if the association were a qualified guaranteed association if the persons sponsored by the association satisfy the criteria specified in (B) below.(B) Persons determined to be eligible pursuant to (9) below applying to the program pursuant to (A) above shall not be qualified unless they: 1. Have been receiving coverage or had successfully applied for coverage through the association as of June 30, 1993, or2. Have been receiving coverage through the association as of December 31, 1992, and whose coverage lapsed at any time thereafter because the employment through which coverage was received ended or an employer's contribution to health coverage ended, or3. Have been covered at any time between June 30, 1993, and July 1, 1994, under a contract that was in force on June 30, 1993.(6) Maintain at the guaranteed association's principal place of business and provide to the program upon request documents that verify that: (A) The guaranteed association membership includes one or more employers meeting the criteria of a sole employer as defined in Section 2699.6000.(B) The guaranteed association does not condition membership directly or indirectly on the health claims history of any person,(C) The guaranteed association uses membership dues solely for and in consideration of the membership and membership benefits,(D) The guaranteed association is organized and maintained for purposes unrelated to insurance,(E) The guaranteed association was in active existence on January 1, 1992, and for at least five (5) years prior to that date,(F) The guaranteed association has been offering health insurance to its members that reside in California for at least five (5) years prior to January 1, 1992, and(G) The guaranteed association has governing documents that provide for the election of its governing board by the membership of the association.(7) For a guaranteed association that has provided coverage to its members through the mechanism of a trust, the guaranteed association shall provide at the program's request documentation that membership in the trust is coincidental with membership in the guaranteed association or that individual members are retired members or the spouse or dependents of a deceased member.(8) Provide to the program documents that illustrate that the member employers and individual members purchasing coverage through the program are bona fide members of the guaranteed association or that individual members are retired members or a spouse of a deceased member, and provide to the program the beginning date of membership for each member employer and individual member.(9) Determine what categories of persons who are not otherwise association members the guaranteed association will sponsor for coverage as members. These may only include employees of members, association staff, retired members, retired employees of members, and surviving spouses and dependents of deceased members. The guaranteed association shall commit to the program that the specified offering will continue until the guaranteed association's annual requalification.Cal. Code Regs. Tit. 10, § 2699.6109
1. Renumbering and amendment of former section 2699.621.5 to section 2699.6109 filed 5-27-94; operative 5-27-94 (Register 94, No. 21).
2. Amendment of subsections (a)(1)-(3) and NOTE filed 12-29-94 as an emergency; operative 12-29-94 (Register 94, No. 52). A Certificate of Compliance must be transmitted to OAL 4-28-95 or emergency language will be repealed by operation of law on the following day.
3. Certificate of Compliance as to 12-29-94 order transmitted to OAL 4-12-95 and filed 5-22-95 (Register 95, No. 21).
4. Amendment of subsection (a)(9) filed 4-25-96; operative 5-25-96 (Register 96, No. 17). Note: Authority cited: Section 10731, Insurance Code. Reference: Sections 10731 and 10741, Insurance Code.
1. Renumbering and amendment of former section 2699.621.5 to section 2699.6109 filed 5-27-94; operative 5-27-94 (Register 94, No. 21).
2. Amendment of subsections (a)(1)-(3) and Note filed 12-29-94 as an emergency; operative 12-29-94 (Register 94, No. 52). A Certificate of Compliance must be transmitted to OAL 4-28-95 or emergency language will be repealed by operation of law on the following day.
3. Certificate of Compliance as to 12-29-94 order transmitted to OAL 4-12-95 and filed 5-22-95 (Register 95, No. 21).
4. Amendment of subsection (a)(9) filed 4-25-96; operative 5-25-96 (Register 96, No. 17).