CHAPTER 238

(HB 1043)

Risk pool benefit plan requirements revised.

        FOR AN ACT ENTITLED, An Act to revise the risk pool rate methodology, to revise the number of risk pool benefit plans offered, and to revise open enrollment for uninsurable children.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:

    Section 1. That § 58-17-125 be amended to read as follows:

    58-17-125. The premium rates for coverages provided by the risk pool may not be unreasonable in relation to the benefits provided, the risk experience, and the reasonable expenses of providing coverage. Case characteristics as allowed pursuant to § 58-17-74 may be used in establishing rates for those covered by the risk pool. The rates shall take into consideration the extra morbidity and administrative expenses, if any, for enrollees in the risk pool. The rates for a given classification for those that qualify for coverage pursuant to § 58-17-85 shall be one hundred fifty percent of the average in force actively marketed premium or payment rate for that classification charged by the three carriers with the largest number of individual health benefit plans in the state during the preceding calendar year. For purposes of this section, only individual health benefit plans that are being actively marketed to the general public may be utilized in determining the largest carriers. The board shall select a sufficient number of carriers from which to calculate the average so that at least ninety percent of the market is represented and the carriers selected sequentially have the largest number of actively marketed health benefit plans. The number of carriers selected may not be less than three. In determining the average rate of the three largest individual health carriers, the rates or payments charged by the carriers shall be actuarially adjusted to determine the rate or payment that would have been charged for benefits similar to those provided by the risk pool.

    Section 2. That § 58-17-130 be amended to read as follows:

    58-17-130. The risk pool shall offer at least three plan designs that provide comprehensive coverage benefits consistent with major medical coverage currently being offered in the individual health insurance market and that include a disease management program. The coverage and benefits for plans provided pursuant to §§ 58-17-68, 58-17-70, 58-17-85, and 58-17-113 to 58-17-142, inclusive, may be established by the board, consistent with the requirements of §§ 58-17-68, 58-17-70, 58-17-85, and 58-17-113 to 58-17-142, inclusive, and may not be altered by any other state law without specific reference to §§ 58-17-68, 58-17-70, 58-17-85, and 58-17-113 to 58-17-142, inclusive, indicating a legislative intent to add or delete from the coverage provided pursuant to §§ 58-17-68, 58-17-70, 58-17-85, and 58-17-113 to 58-17-142, inclusive. The three plan designs, henceforth known as Plan A, Plan B, and Plan C, shall have annual deductibles of one thousand dollars, three thousand dollars, and ten thousand dollars, respectively. After the deductible has been met, the plan shall pay seventy-five percent of the eligible expenses and the enrollee is responsible for the balance of the coinsurance amount. The enrollee is responsible for a maximum out-of-pocket coinsurance amount of two

thousand two hundred fifty dollars in addition to the deductible amount. All three plans shall cover biologically-based mental illnesses on the same basis as other covered illnesses. The board may create additional plan designs to meet federal requirements for qualifying high deductible health plans for health savings accounts.

    Section 3. That § 58-17-132 be amended to read as follows:

    58-17-132. Each plan shall provide pharmacy benefits. In addition to deductibles and coinsurance amounts in § 58-17-130, the enrollee shall pay a twenty-five percent coinsurance for each prescription up to the maximum out-of-pocket coinsurance amount of fifteen hundred dollars. If an intervention or cost containment mechanism is refused without a verifiable medical reason, the enrollee shall pay a fifty percent coinsurance amount and only twenty-five percent of the coinsurance applies toward the maximum out-of- pocket coinsurance amount for pharmacy benefits. The cost sharing provisions for the pharmacy benefit shall be established by the board and outlined in the plan document.

    Section 4. That § 58-17-144 be amended to read as follows:

    58-17-144. A person under the age of nineteen, who is not otherwise qualified for the risk pool pursuant to § 58-17-85, may enroll in the risk pool if the following conditions are met:

            (1)    The person is a citizen of the United States of America and a resident of this state;

            (2)    The person has been rejected, or offered coverage conditioned upon exclusionary riders, by at least two carriers one carrier in the individual market for comprehensive major medical coverage in the last six months;

            (3)    The person has not had comprehensive major medical coverage or other creditable coverage within the six months preceding application for the risk pool; and

            (4)    The person is not covered or eligible to be covered by any other creditable coverage.

    The risk pool board may establish an open enrollment period periods for persons, which qualify for enrollment pursuant to this section and which have been without creditable coverage for at least twelve months, during the first twelve months following July 1, 2009. No enrollee is subject to a preexisting waiting period as defined by § 58-17-84 during this twelve-month an open enrollment period. The open enrollment period shall be sixty days two months in duration.

     Signed February 25, 2010

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