RS 22:883

§883. Stop-loss insurance coverage A. Stop-loss coverage shall be defined as insurance covering the loss of an insured above a specific amount or a self-insurer for losses over a stated amount. B. Any insurer authorized to issue property and casualty or health and accident policies of insurance in this state shall report, with its annual statement, any premiums written in this state for stop-loss or excess insurance coverage to the Department of Insurance in the manner prescribed by the commissioner. C. A stop-loss or excess insurance policy form intended for issue to cover losses of a group health plan, as defined in R.S. 22:1061(1), shall be submitted to the Department of Insurance for prior approval pursuant to the policy form filing requirements established by R.S. 22:861 and shall satisfy the following conditions: (1) The stop-loss or excess insurance policy shall be issued to and insure the group health plan or the plan itself and not the employees, members, or participants. (2) Payments by the insurer shall be made to the sponsor of the group health plan or the plan itself and not the employees, members, participants, or providers. (3) The specific stop-loss or excess limit or attachment point per individual claimant shall be at least ten thousand dollars. The aggregate stop-loss or excess limit or attachment point for groups of fifty or fewer shall be, at a minimum, one hundred twenty percent of the group health plan's total expected claims per policy period. The aggregate stop-loss or excess limit or attachment point for groups of fifty-one or more shall be, at a minimum, one hundred ten percent of the group health plan's total expected claims per policy period. (4) The stop-loss or excess insurance policy shall contain a provision stating that the bankruptcy or insolvency of the insured shall not relieve the stop-loss carrier from its obligation under R.S. 22:1269(A). (5)(a) The stop-loss or excess insurance policy shall contain a provision that eligible claims incurred under the group health plan during the initial contract period shall be covered, provided that proof of payment by the plan is furnished to the insurer within ninety days after the expiration of the policy or any later period that is provided in the contract or insurance policy. (b) All applications for stop-loss or excess insurance must include the option to purchase coverage extending, for at least ninety days beyond the expiration of the contract term, the period within which claims incurred during the contract term must be submitted and paid. (c) All applications for stop-loss or excess insurance that include the option to purchase a policy providing coverage restricted to claims both incurred and paid during the contract term must contain a form for acceptance or rejection of the offer mandated in Subparagraph (b) of this Paragraph and must include disclosures as prescribed by the commissioner. (d) All applications for stop-loss or excess insurance including options to purchase a policy providing coverage for claims incurred prior to the contract term, or providing coverage for claims incurred prior to the contract term but paid during the contract term, must contain a form for acceptance or rejection of the offer mandated in Subparagraph (b) of this Paragraph and must include disclosures as prescribed by the commissioner. (6) The stop-loss or excess insurance policy shall provide coverage with rates not subject to adjustment by the stop-loss insurer during the policy period, unless any of the following occur: (a) There is a change in the benefits provided under the group health plan. (b) Enrollment under the group health plan changes by at least ten percent. (7) The stop-loss or excess insurance policy form filed with the Department of Insurance for approval shall contain a separate document certifying that each of the requirements specified in Paragraphs (1) through (6) of this Subsection have been met. D. Stop-loss or excess insurance shall not be equivalent to reinsurance, as reinsurance only relates to transactions between insurers. An entity purporting to cover a self-insured group health plan shall be treated as a stop-loss or excess insurer and shall be subject to the insurance laws and regulations of the state relating to such insurers and to penalties for violations of such laws and regulations. In no instance shall stop-loss or excess loss insurance be defined as a contract or policy of health insurance under R.S. 22:452(1)(a). E. Insurance companies writing stop-loss or excess insurance coverage shall exercise due diligence in ascertaining the legitimacy or authority of the underlying group health plan before issuing coverage. This shall include but not be limited to ensuring that the underlying plan is not a self-insured multiple employer welfare arrangement, as defined in 29 U.S.C. §1002(40) unless the underlying plan is a self-insurance plan as defined in R.S. 22:452(1) and is authorized to do business in this state as a self-insurer. F. Provider stop-loss or excess insurance policies that protect health care providers from a portion of the financial risk assumed in managed care contracts with health and accident insurers, health maintenance organizations, and self-insured group plans shall be submitted to the Department of Insurance for approval and shall satisfy the following conditions: (1) The stop-loss or excess insurance policy shall be issued to and insure the contracted provider or network of health care providers. (2) Payments by the insurer shall be made to the contracted provider or network of health care providers. (3) The individual stop-loss amount, that is, retention or attachment point per claimant, shall be at least five thousand dollars. The aggregate stop-loss or excess amount shall be, at a minimum, fifty thousand dollars per calendar year. (4) The stop-loss or excess insurance policy shall contain a provision that the proof of loss shall be furnished to the insurer within ninety days after the date that loss is incurred or any later period that is provided in the contract or insurance policy. (5) Filings of a stop-loss or excess insurance policy filed with the Department of Insurance for approval shall contain a separate document certifying that each of the requirements specified in Paragraphs (1) through (4) of this Subsection have been met. G. A stop-loss or excess insurance policy form covering any other kind of loss, damage, or liability may only be written by a property and casualty insurer and shall satisfy the following conditions: (1) The stop-loss or excess insurance policy shall be issued to and insure an individual or business against legal liabilities other than those associated with provision of health benefits to employees or members of a health benefit plan or managed care health plan. (2) Payments by the insurer shall be made to the insured upon provision of proof of loss. H.(1) Health stop-loss insurance issued in connection with an employee benefit plan of a small employer as defined in R.S. 22:1061 shall be issued on or after January 1, 2026, only if the insurance policy satisfies all of the following: (a) Is not subject to renewal rate increases exceeding the percentage change in the medical care index of the consumer price index over the duration of the previous plan year plus fifty percent, unless an increase greater than fifty percent is actuarially justified. (b) Has a contract term with guaranteed rates for at least twelve months, without adjustment, unless there is a change in the benefits provided under the small employer's health plan during the contract period or the number of employees covered under the plan increases or decreases by more than fifteen percent. (c) Includes either a specific attachment point or an aggregate attachment point in a contract, or both if the parties contract for both. (d) Aligns stop-loss plan benefit limitations and exclusions with a small employer's health plan benefit limitations and exclusions, including any annual or lifetime limits in the employer's health plan except to the extent that the plan benefit or limitation is otherwise covered by the employer through other insurance. (e) Pays stop-loss claims incurred during the contract period and paid within twenty-four months after the expiration date of the contract. (f) Includes provisions to cover eligible plan claims regardless of the termination of the plan prior to the end of the contract period, subject to the stop-loss contract's minimum attachment points. (2) No health stop-loss insurance issued in connection with an employee benefit plan of an employer with less than five employees shall be issued on or after January 1, 2026, if the insurance policy contains a provision permitting or authorizing the adjustment of specific deductibles or attachment points of a plan member or of specific diseases or conditions. (3) The provisions of this Subsection shall not apply to any policy in effect prior to January 1, 2026. I.(1) Any health stop-loss policy issued after January 1, 2026, shall include a separate disclosure form explaining the limitations of coverage, potential employer risk, and impact of claims on renewals. The employer shall sign the disclosure form prior to purchasing the policy. (2) The commissioner of insurance shall develop a standardized disclosure form no later than January 1, 2026. Acts 2001, No. 273, §1, eff. June 1, 2001; Acts 2003, No. 140, §1; Acts 2007, No. 80, §1; Redesignated from R.S. 22:675 by Acts 2008, No. 415, §1, eff. Jan. 1, 2009; Acts 2010, No. 375, §1, eff. Jan. 1, 2011; Acts 2025, No. 400, §1.