Section 1389.21 Of Article 7.5. Underwriting Practices From California Health And Safety Code >> Division 2. >> Chapter 2.2. >> Article 7.5.
1389.21
. (a) A health care service plan shall not rescind a plan
contract, or limit any provisions of a plan contract, once an
enrollee is covered under the contract unless the plan can
demonstrate that the enrollee has performed an act or practice
constituting fraud or made an intentional misrepresentation of
material fact as prohibited by the terms of the contract.
(b) If a plan intends to rescind a plan contract pursuant to
subdivision (a), the plan shall send a notice to the enrollee or
subscriber via regular certified mail at least 30 days prior to the
effective date of the rescission explaining the reasons for the
intended rescission and notifying the enrollee or subscriber of his
or her right to appeal that decision to the director pursuant to
subdivision (b) of Section 1365.
(c) Notwithstanding subdivision (a), Section 1365 or any other
provision of law, after 24 months following the issuance of a health
care service plan contract, a plan shall not rescind the plan
contract for any reason, and shall not cancel the plan contract,
limit any of the provisions of the plan contract, or raise premiums
on the plan contract due to any omissions, misrepresentations, or
inaccuracies in the application form, whether willful or not. Nothing
in this subdivision shall be construed to alter existing law that
otherwise applies to a health care service plan within the first 24
months following the issuance of a health care service plan contract.