Section 0780-01-61-.04 - DEFINITIONS(1) In the event the definitions in these rules and T.C.A. §§ 56-42-101, et seq., conflict, the definitions in the statute control.(2) "Applicant" means: (a) In the case of an individual long-term care insurance policy, the person who seeks to contract for benefits; and(b) In the case of a group long-term care insurance policy, the proposed certificate holder.(3) "Certificate" means any certificate issued under a group long-term care insurance policy, which policy has been delivered or issued for delivery in this state.(4) "Commissioner" means the commissioner of commerce and insurance.(5)(a) "Exceptional increase" means only those increases filed by an insurer as exceptional for which the Commissioner determines the need for the premium rate increase is justified: 1. Due to changes in laws or regulations applicable to long-term care coverage in this state; or2. Due to increased and unexpected utilization that affects the majority of insurers of similar products.(b) Except as provided in Rule 0780-1-61-.20, exceptional increases are subject to the same requirements as other premium rate schedule increases.(c) The Commissioner may request a review by an independent actuary or a professional actuarial body of the basis for a request that an increase be considered an exceptional increase.(d) The Commissioner, in determining that the necessary basis for an exceptional increase exists, shall also determine any potential offsets to higher claims costs.(6) "Group long-term care insurance" means a long-term care insurance policy which is delivered or issued for delivery in this state and issued to:(a) One (1) or more employers or labor organizations, or to a trust or to the trustees of a fund established by one (1) or more employers or labor organizations, or a combination thereof, for employees or former employees, or a combination thereof, or for members or former members, or a combination thereof, of the labor organizations;(b) Any professional, trade or occupational association for its members or former or retired members, or combination thereof, if such association: 1. Is composed of individuals all of whom are or were actively engaged in the same profession, trade or occupation; and2. Has been maintained in good faith for purposes other than obtaining insurance;(c)1. An association or a trust or the trustee or trustees of a fund established, created or maintained for the benefit of members of one (1) or more associations. Prior to advertising, marketing or offering such policy within this state, the association or associations, or the insurer of the association or associations, shall file evidence with the Commissioner that the association or associations have at the outset a minimum of one hundred (100) persons and have been organized and maintained in good faith for purposes other than that of obtaining insurance, have been in active existence for at least one (1) year; and have a constitution and bylaws which provide that: (i) The association or associations hold regular meetings not less than annually to further purposes of the members;(ii) Except for credit unions, the association or associations collect dues or solicit contributions from members; and(iii) The members have voting privileges and representation on the governing board and committees;2. Thirty (30) days after such filing, the association or associations will be deemed to satisfy such organizational requirements, unless the Commissioner makes a finding that the association or associations do not satisfy those organizational requirements; or(d) A group other than as described in Paragraphs (5)(a) through (5)(c) of this rule, subject to a finding by the Commissioner that:1. The issuance of the group policy is not contrary to the best interest of the public;2. The issuance of the group policy would result in economies of acquisition or administration; and3. The benefits are reasonable in relation to the premiums charged.(7) "Incidental," as used in Rule 0780-1-61-.20(10), means that the value of the long-term care benefits provided is less than ten percent (10%) of the total value of the benefits provided over the life of the policy. These values shall be measured as of the date of issue.(8) "Long-term care insurance" means any insurance policy or rider advertised, marketed, offered or designed to provide coverage for not less than twelve (12) consecutive months for each covered person on an expense incurred, indemnity, prepaid or other basis, for one (1) or more necessary or medically necessary diagnostic, preventive, therapeutic, rehabilitative, maintenance, or personal care services, provided in a setting other than an acute care unit of a hospital. "Long-term care insurance" includes group and individual policies or riders whether issued by insurers, fraternal benefit societies, nonprofit health, hospital, and medical service corporations, prepaid health plans, health maintenance organizations or any similar organization. "Long-term care insurance" does not include any insurance policy which is offered primarily to provide basic Medicare supplement coverage, basic hospital expense coverage, basic medical-surgical expense coverage, hospital confinement indemnity coverage, major medical expense coverage, disability income protection coverage, accident only coverage, specified disease or specified accident coverage, or limited benefit health coverage.(9) "Policy" means any policy, contract, subscriber agreement, rider or endorsement delivered or issued for delivery in this state by an insurer, fraternal benefit society, nonprofit health, hospital or medical service corporation, prepaid health plan, health maintenance organization or any similar organization.(10) "Preexisting condition" means a condition for which medical advice or treatment was recommended by, or received from, a provider of health care services, within six (6) months preceding the effective date of coverage of an insured person.(11) "Qualified actuary" means a member in good standing of the American Academy of Actuaries.(12)(a) "Qualified long-term care insurance contract" or "federally tax-qualified long-term care insurance contract" means an individual or group insurance contract that meets the requirements of Section 7702B(b) of the Internal Revenue Code of 1986, as amended, as follows: 1. The only insurance protection provided under the contract is coverage of qualified long-term care services. A contract shall not fail to satisfy the requirements of this subparagraph by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate.2. The contract does not pay or reimburse expenses incurred for services or items to the extent that the expenses are reimbursable under Title XVIII of the Social Security Act, as amended, or would be so reimbursable but for the application of a deductible or coinsurance amount. The requirements of this subparagraph do not apply to expenses that are reimbursable under Title XVIII of the Social Security Act only as a secondary payor. A contract shall not fail to satisfy the requirements of this subparagraph by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate.3. The contract is guaranteed renewable, within the meaning of Section 7702B(b)(1)(C) of the Internal Revenue Code of 1986, as amended.4. The contract does not provide for a cash surrender value or other money that can be paid, assigned, pledged as collateral for a loan, or borrowed except as provided in Paragraph (12)(a)5. of this rule.5. All refunds of premiums, and all policyholder dividends or similar amounts, under the contract are to be applied as a reduction in future premiums or to increase future benefits, except that a refund on the event of death of the insured or a complete surrender or cancellation of the contract cannot exceed the aggregate premiums paid under the contract.6. The contract meets the consumer protection provisions set forth in Section 7702B(g) of the Internal Revenue Code of 1986, as amended.(b) "Qualified long-term care insurance contract" or "federally tax-qualified long term care insurance contract" also means the portion of a life insurance contract that provides long-term care insurance coverage by rider or as part of the contract and that satisfies the requirements of Sections 7702B(b) and (e) of the Internal Revenue Code of 1986, as amended.(13) "Similar policy forms" means all of the long-term care insurance policies and certificates issued by an insurer in the same long-term care benefit classification as the policy form being considered. Certificates of groups that meet the definition in this rule are not considered similar to certificates or policies otherwise issued as long-term care insurance, but are similar to other comparable certificates with the same long-term care benefit classifications. For purposes of determining similar policy forms, long-term care benefit classifications are defined as follows: institutional long-term care benefits only, non-institutional long-term care benefits only, or comprehensive long-term care benefits.Tenn. Comp. R. & Regs. 0780-01-61-.04
Original rule filed June 20, 1991; effective August 4, 1991. Repeal and new rule filed June 15, 2005; effective August 29, 2005.Authority: T.C.A. § 56-42-105.