230 R.I. Code R. 230-RICR-20-30-10.3

Current through December 3, 2024

Section 230-RICR-20-30-10.3 - Applicability and Scope

A. Applicability

1. Except as provided in § 10.3(A)(2) or (3) and § 10.11 of this Part, this Part shall apply to any health benefit plan, whether provided on a group or individual basis, that:

a. meets one or more of the conditions set forth in R.I. Gen. Laws § 27-50-4(a); and

b. provides coverage to one or more employees of a small employer located in this state, without regard to whether the policy or certificate was issued in this state

2. Individual health insurance; self-employed persons; plans and deductions under the Internal Revenue Code.

a. The provisions of the Act and this regulation shall not apply to an individual health insurance policy purchased by a self-employed person for himself or herself alone or for that person and his or her spouse and/or family under conditions that do not meet those set forth in R.I. Gen. Laws § 27-50-4(a).

b. If the case of a self-employed person, the conditions set forth in R.I. Gen. Laws § 27-50-4(a)(4) have been met if:

(1) the health insurance is marketed to the self-employed person in his or her capacity as a self-employed person; or

(2) the health insurance is marketed to the self-employed person through that person's membership (or potential membership) in an association or trade group for small employers or self-employed persons.

c. A policy that otherwise meets the requirements of an individual health insurance policy and does not fall under the provisions of the Act and this regulation shall not be considered to have met the requirement of R.I. Gen. Laws § 27-50-4(a)(3) and therefore shall not be subject to the Act and this regulation solely because:

(1) the policyholder treats the health insurance policy as part of a plan or program under §125 of the Internal Revenue Code (26 U.S.C. § 125); provided however, that no portion of the premium is paid by the small employer through such a plan or program; or

(2) the policyholder elects a deduction under §162(l) of the Internal Revenue Code (26 U.S.C. § 162(I)).

3. The provisions of the Act and this regulation shall apply to dental, vision or long term care benefits only as provided for in 45 C.F.R. § 146.145.

B. Relationship to individual health insurance.

1. Except as provided in § 10.3(A)(2) of this Part, a carrier that provides individual health insurance policies to one or more of the employees of a small employer shall be considered a small employer carrier and shall be subject to the provisions of the Act and this regulation with respect to such policies if the small employer contributes directly or indirectly to the premiums for the policies and the carrier is aware or should have been aware of such contribution.

2. In the case of a carrier that provides individual health insurance policies to one or more employees of a small employer, the small employer shall be considered to be an eligible small employer as defined in R.I. Gen. Laws § 27-50-3(kk) and the small employer carrier shall be subject to R.I. Gen. Laws § 27-50-7(b) (relating to guaranteed issue of coverage) if:

a. the employer qualifies as a small employer under the definitions contained in R.I. Gen. Laws §§ 27-50-3 and 27-50-7;

b. the small employer contributes directly or indirectly to the premiums charged by the carrier; and

c. he carrier is aware or should have been aware of the contribution by the employer.

C. Association or discretionary groups. The provisions of the Act and this regulation shall apply to a health benefit plan provided to a small employer or to the employees of a small employer without regard to whether the health benefit plan is offered under or provided through a group policy or trust arrangement of any size sponsored by an association or discretionary group.

D. Number of eligible employees.

1. If a small employer is issued a health benefit plan under the terms of the Act, the provisions of the Act and this regulation shall continue to apply to the health benefit plan even in the event that the small employer subsequently employs more than fifty eligible employees. A carrier providing coverage to such an employer shall, within sixty days of becoming aware that the employer has more than fifty eligible employees, but no later than the anniversary date of the employer's health benefit plan, notify the employer that the provisions and protections provided under the Act and this regulation shall cease to apply to the employer if such employer fails to renew its current health benefit plan or elects to enroll in a different health benefit plan.

2. If a health benefit plan is issued to an employer that is not a small employer as defined in the Act, but subsequently the employer becomes a small employer (for any reason including the loss or change of work status of one or more employees), the terms of the Act shall not apply to the health benefit plan. The carrier providing a health benefit plan to such an employer shall not become a small employer carrier under the terms of the Act solely because the carrier continues to provide coverage under the health benefit plan to the employer. A carrier providing coverage to such an employer shall, within sixty days of becoming aware that the employer has fifty or fewer eligible employees, notify the employer of the options and protections available to the employer under the Act, including the employer's option to purchase a small employer health benefit plan from any small employer carrier.

E. Employees outside of Rhode Island

1. If a small employer has employees in more than one state, the provisions of the Act and this regulation shall apply to a health benefit plan issued to that small employer if:

a. the majority of eligible employees of such small employer are employed in this state; or

b. the primary business location of the small employer is in this state and no state has a majority of the eligible employees of the small employer.

2. In determining whether the laws of this state or another state apply to a health benefit plan issued to a small employer described in § 10.3(E)(1) of this Part, the provisions of § 10.3(E)(1) of this Part shall be applied as of the date the health benefit plan was issued to the small employer for the period that the health benefit plan remains in effect.

3. If a health benefit plan is subject to the Act and this regulation, the provisions of the Act and this regulation shall apply to all individuals covered under the health benefit plan, whether they reside in this state or in another state.

F. Small employer carriers not operating in Rhode Island. A carrier that is not operating as a small employer carrier in this state shall not become subject to the provisions of the Act and this regulation solely because a small employer that was issued a health benefit plan in another state by that carrier moves to this state.

230 R.I. Code R. 230-RICR-20-30-10.3