Section 1358.6 Of Article 3.5. Additional Requirements For Medicare Supplement Contracts From California Health And Safety Code >> Division 2. >> Chapter 2.2. >> Article 3.5.
1358.6
. (a) (1) Except for permitted preexisting condition clauses
as described in Sections 1358.7, 1358.8, and 1358.81, a contract
shall not be advertised, solicited, or issued for delivery as a
Medicare supplement contract if the contract contains definitions,
limitations, exclusions, conditions, reductions, or other provisions
that are more restrictive or limiting than that term as officially
used in Medicare, except as expressly authorized by this article.
(2) No issuer may advertise, solicit, or issue for delivery any
Medicare supplement contract with hospital or medical coverage if the
contract contains any of the prohibited provisions described in
subdivision (b).
(b) The following provisions shall be deemed to be unfair,
unreasonable, and inconsistent with the objectives of this chapter
and shall not be contained in any Medicare supplement contract:
(1) Any waiver, exclusion, limitation, or reduction based on or
relating to a preexisting disease or physical condition, unless that
waiver, exclusion, limitation, or reduction (A) applies only to
coverage for specified services rendered not more than six months
from the effective date of coverage, (B) is based on or relates only
to a preexisting disease or physical condition defined no more
restrictively than a condition for which medical advice was given or
treatment was recommended by or received from a physician within six
months before the effective date of coverage, (C) does not apply to
any coverage under any group contract, and (D) is approved in advance
by the director. Any limitations with respect to a preexisting
condition shall appear as a separate paragraph of the contract and be
labeled "Preexisting Condition Limitations."
(2) Except with respect to a group contract subject to, and in
compliance with, Section 1399.62, any provision denying coverage,
after termination of the contract, for services provided continuously
beginning while the contract was in effect, during the continuous
total disability of the subscriber or enrollee, except that the
coverage may be limited to a reasonable period of time not less than
the duration of the contract benefit period, if any, and may be
limited to the maximum benefits provided under the contract.
(c) A Medicare supplement contract in force shall not contain
benefits that duplicate benefits provided by Medicare.
(d) (1) Subject to paragraphs (4) and (5) of subdivision (a) of
Section 1358.8, a Medicare supplement contract with benefits for
outpatient prescription drugs that was issued prior to January 1,
2006, shall be renewed for current enrollees and subscribers, at
their option, who do not enroll in Medicare Part D.
(2) A Medicare supplement contract with benefits for outpatient
prescription drugs shall not be issued on and after January 1, 2006.
(3) On and after January 1, 2006, a Medicare supplement contract
with benefits for outpatient prescription drugs shall not be renewed
after the enrollee or subscriber enrolls in Medicare Part D unless
both of the following conditions exist:
(A) The contract is modified to eliminate outpatient prescription
drug coverage for outpatient prescription drug expenses incurred
after the effective date of the individual's coverage under a
Medicare Part D plan.
(B) The premium is adjusted to reflect the elimination of
outpatient prescription drug coverage at the time of enrollment in
Medicare Part D, accounting for any claims paid if applicable.