2017 Montana Legislature

HOUSE BILL NO. 73

INTRODUCED BY R. LYNCH

BY REQUEST OF THE ECONOMIC AFFAIRS INTERIM COMMITTEE

AN ACT PROVIDING FOR REGULATION UNDER THE INSURANCE CODE FOR CERTAIN PRIVATE AIR AMBULANCE SERVICE MEMBERSHIP AGREEMENTS; REMOVING AN EXEMPTION FROM INSURANCE REGULATION; ESTABLISHING FEES, LICENSING, TRADE, FORM FILING, AND RECORDKEEPING REQUIREMENTS; GRANTING RULEMAKING AUTHORITY; AMENDING SECTIONS 33-1-102 AND 50-6-320, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE AND AN APPLICABILITY DATE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:

Section 1. Certificate of authority required. (1) A private air ambulance service subject to [sections 1 through 9] shall obtain a certificate of authority from the commissioner prior to selling, soliciting, or negotiating a membership agreement in Montana.

(2) A private air ambulance service applying for a certificate of authority shall submit an application on a form prescribed by the commissioner.

(3) The commissioner may issue a certificate of authority if the private air ambulance service has complied with the applicable provisions of Title 50 and this title unless the commissioner finds that issuance of the certificate of authority is contrary to the public interest.

(4) A private air ambulance service may renew its certificate of authority upon payment of the annual fee specified in [section 2] on or before March 1 of each year and upon continued compliance with the applicable provisions of Title 50 and this title.

(5) The requirements of this section are in addition to any other licensing or registration requirements that apply to the private air ambulance service.

Section 2. Fees. A private air ambulance service subject to [sections 1 through 9] shall pay the following fees to the commissioner for services rendered:

(1) issuance of a certificate of authority, $300;

(2) annual renewal fee, $300; and

(3) filing of a membership agreement or other forms, $50.

Section 3. Filings. (1) Pursuant to Title 33, chapter 1, part 5, a private air ambulance service subject to [sections 1 through 9] shall file for approval any membership agreement, including any rider or endorsement.

(2) A filing under subsection (1) must include all fee schedules associated with the membership agreement.

Section 4. Suspension or revocation. (1) The commissioner may suspend or revoke a private air ambulance service certificate of authority if the private air ambulance service:

(a) no longer meets the requirements for the certificate of authority;

(b) materially fails to comply with a membership agreement issued to residents of Montana;

(c) is in unsound fiscal condition or is demonstrated to be using methods or practices in the conduct of its business that render its further transaction of insurance in this state injurious or hazardous to its members or to the public; or

(d) violates an applicable provision of law.

(2) Unless otherwise provided in the order of suspension or revocation, the private air ambulance service shall continue to honor membership agreements that are in force at the time of revocation or suspension.

Section 5. Trade practices. (1) A private air ambulance service subject to [sections 1 through 9] may not use health status as a reason to:

(a) refuse to issue or renew a membership agreement;

(b) assess a differing rate or charge for the membership agreement; or

(2) A private air ambulance service subject to [sections 1 through 9] may not sell, solicit, negotiate, or advertise a membership program in a geographic area for which the private air ambulance does not routinely provide service.

(3) Except as provided in subsection (4)(b), if membership coverage of a transport is conditioned on a finding of medical necessity, a qualified medical professional shall render the determination.

(4) A membership agreement requirement of medical necessity is satisfied if:

(a) the treating physician requesting the transport certifies that the transport is medically necessary; or

(b) the member's insurer determines that the transport is medically necessary.

Section 6. Membership agreement -- contents. A membership agreement issued under [sections 1 through 9] must contain:

(1) the effective dates of the membership agreement;

(2) a grace period of 30 days for payment of a renewal membership fee;

(3) a description of what constitutes acceptable insurance coverage if eligibility for the membership agreement is conditioned on the member's current and continuing health insurance coverage;

(4) a statement that, except for decisions made as provided in 33-1-102(6), individuals enrolled in medicare, medicaid, or the healthy Montana kids plan under Title 53, chapter 4, part 11, are not subject to charges billed by a private air ambulance service in excess of applicable deductibles, coinsurance, and copayments;

(5) a statement that the membership agreement is an insurance contract;

(6) a description and graphic illustration of the base locations and effective coverage area of the private air ambulance service;

(7) a list of other private air ambulance services with which reciprocity exists under 50-6-320;

(8) a statement that:

(a) participation in a membership program does not guarantee that in the event of a transport, the private air ambulance service will provide the transport; and

(b) unless reciprocity exists under 50-6-320, if another private air ambulance service provides the transport, the individual will not receive the benefits provided under the membership agreement; and

(9) a definition of "medical necessity" if membership coverage of a transport is conditioned on a finding of medical necessity.

Section 7. Recordkeeping requirements. (1) A private air ambulance subject to [sections 1 through 9] shall keep records of:

(a) all insurance transactions conducted in Montana; and

(b) all transports provided to individuals entering into membership agreements.

(2) A private air ambulance service subject to this section shall make the records under subsection (1) available to the commissioner on request.

Section 8. Relationship to other laws. (1) Except as provided in subsection (2), the chapters and provisions of this title do not apply to a private air ambulance service.

(2) Title 33, chapter 1, parts 3, 4, 5, 12, and 13, chapter 18, parts 2 and 10, and chapter 19 as well as [sections 1 through 9] apply to a private air ambulance service that offers a membership program covering out-of-pocket expenses in excess of deductibles, copays, and coinsurance incurred for out-of-network services using the private air ambulance service or to private air ambulance services that are out-of-network and with which the membership program has reciprocity.

(3) A membership program of the type described in subsection (2) is insurance as defined in 33-1-201.

Section 9. Rulemaking authority. The department shall adopt rules necessary to implement this part.

Section 10. Section 33-1-102, MCA, is amended to read:

"33-1-102. (Temporary) Compliance required -- exceptions -- health service corporations -- health maintenance organizations -- governmental insurance programs -- service contracts. (1) A person may not transact a business of insurance in Montana or a business relative to a subject resident, located, or to be performed in Montana without complying with the applicable provisions of this code.

(2) The provisions of this code do not apply with respect to:

(a) domestic farm mutual insurers as identified in chapter 4, except as stated in chapter 4;

(b) domestic benevolent associations as identified in chapter 6, except as stated in chapter 6; and

(3) This code applies to health service corporations as prescribed in 33-30-102. The existence of the corporations is governed by Title 35, chapter 2, and related sections of the Montana Code Annotated.

(4) Except as provided in Title 33, chapter 40, part 1, this code does not apply to health maintenance organizations to the extent that the existence and operations of those organizations are governed by chapter 31.

(5) This code does not apply to workers' compensation insurance programs provided for in Title 39, chapter 71, part 21, and related sections.

(6) The department of public health and human services may limit the amount, scope, and duration of services for programs established under Title 53 that are provided under contract by entities subject to this title. The department of public health and human services may establish more restrictive eligibility requirements and fewer services than may be required by this title.

(7) This code does not apply to the state employee group insurance program established in Title 2, chapter 18, part 8, or the Montana university system group benefits plans established in Title 20, chapter 25, part 13.

(8) This code does not apply to insurance funded through the state self-insurance reserve fund provided for in 2-9-202.

(9) (a) Except as otherwise provided in Title 33, chapters 22 and 28, this code does not apply to any arrangement, plan, or interlocal agreement between political subdivisions of this state in which the political subdivisions undertake to separately or jointly indemnify one another by way of a pooling, joint retention, deductible, or self-insurance plan.

(b) Except as otherwise provided in Title 33, chapter 22, this code does not apply to any arrangement, plan, or interlocal agreement between political subdivisions of this state or any arrangement, plan, or program of a single political subdivision of this state in which the political subdivision provides to its officers, elected officials, or employees disability insurance or life insurance through a self-funded program.

(10) (a) This code does not apply to the marketing of, sale of, offering for sale of, issuance of, making of, proposal to make, and administration of a service contract.

(b) A "service contract" means a contract or agreement for a separately stated consideration for a specific duration to perform the repair, replacement, or maintenance of property or to indemnify for the repair, replacement, or maintenance of property if an operational or structural failure is due to a defect in materials or manufacturing or to normal wear and tear, with or without an additional provision for incidental payment or indemnity under limited circumstances, including but not limited to towing, rental, and emergency road service. A service contract may provide for the repair, replacement, or maintenance of property for damage resulting from power surges or accidental damage from handling. A service contract does not include motor club service as defined in 61-12-301.

(11) (a) Subject to 33-18-201 and 33-18-242, this code does not apply to insurance for ambulance services sold by a county, city, or town or to insurance sold by a third party if the county, city, or town is liable for the financial risk under the contract with the third party as provided in 7-34-103.

(b) If the financial risk for ambulance service insurance is with an entity other than the county, city, or town, the entity is subject to the provisions of this code.

(12) Except as provided in Title 33, chapter 40, part 1, this code does not apply to the self-insured student health plan established in Title 20, chapter 25, part 14.

(13) This Except as provided in [section 8], this code does not apply to private air ambulance services that are in compliance with 50-6-320 and that solicit membership subscriptions, accept membership applications, charge membership fees, and provide air ambulance services to subscription members and designated members of their households.

(14) This code does not apply to guaranteed asset protection waivers that are governed by 30-14-151 through 30-14-157. (Terminates December 31, 2017--sec. 14, Ch. 363, L. 2013.)

33-1-102. (Effective January 1, 2018) Compliance required -- exceptions -- health service corporations -- health maintenance organizations -- governmental insurance programs -- service contracts. (1) A person may not transact a business of insurance in Montana or a business relative to a subject resident, located, or to be performed in Montana without complying with the applicable provisions of this code.

(2) The provisions of this code do not apply with respect to:

(a) domestic farm mutual insurers as identified in chapter 4, except as stated in chapter 4;

(b) domestic benevolent associations as identified in chapter 6, except as stated in chapter 6; and

(4) This code does not apply to health maintenance organizations to the extent that the existence and operations of those organizations are governed by chapter 31.

(5) This code does not apply to workers' compensation insurance programs provided for in Title 39, chapter 71, part 21, and related sections.

(8) This code does not apply to insurance funded through the state self-insurance reserve fund provided for in 2-9-202.

(10) (a) This code does not apply to the marketing of, sale of, offering for sale of, issuance of, making of, proposal to make, and administration of a service contract.

(b) If the financial risk for ambulance service insurance is with an entity other than the county, city, or town, the entity is subject to the provisions of this code.

(12) This code does not apply to the self-insured student health plan established in Title 20, chapter 25, part 14.

(14) This code does not apply to guaranteed asset protection waivers that are governed by 30-14-151 through 30-14-157."

Section 11. Section 50-6-320, MCA, is amended to read:

"50-6-320. Private air ambulance service -- findings -- exemptions from insurance code. (1) The legislature finds that there is a need to assist Montana consumers with regard to the availability and affordability of air ambulance service.

(2) A Except as provided in subsection (3), a private air ambulance service that solicits membership subscriptions, accepts membership applications, charges membership fees, and provides air ambulance services to subscription members and designated members of their households is not an insurer as defined in 33-1-201, a health carrier as defined in 33-36-103, a health service corporation as defined in 33-30-101, or a health maintenance organization as defined in 33-31-102 if the private air ambulance service:

(a) is licensed in accordance with 50-6-306;

(b) has been in operation in Montana for at least 2 years; and

(3) The provisions of Title 33 prescribed in [section 8] apply to a private air ambulance service that offers a membership program covering out-of-pocket expenses in excess of deductibles, copays, and coinsurance incurred for out-of-network services using the private air ambulance service or to private air ambulance services that are out-of-network and with which the membership program has reciprocity.

(3)(4) Any A private air ambulance service membership program must have arrangements reciprocity agreements with all other air ambulance service providers in Montana to the extent reasonably possible with air ambulance service membership programs to ensure maximum geographic coverage within the state for the subscribers to the program."

Section 12. Codification instruction. [Sections 1 through 9] are intended to be codified as an integral part of Title 33, chapter 2, and the provisions of Title 33, chapter 2, apply to [sections 1 through 9].

Section 13. Severability. If a part of [this act] is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of [this act] is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications.

Section 14. Effective date -- applicability. [This act] is effective on passage and approval and applies to private air ambulance membership agreements sold, solicited, or negotiated on or after [the effective date of this act] for purposes of out-of-network coverage of out-of-pocket expenses in excess of deductibles, copays, and coinsurance.

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Latest Version of HB 73 (HB0073.ENR)
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