2014 -- H 7646

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LC004183

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO INSURANCE -- CANCELLATION OF POLICIES

     

     Introduced By: Representatives Lima, Azzinaro, Fellela, Ucci, and Messier

     Date Introduced: February 27, 2014

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 27-18 of the General Laws entitled "Accident and Sickness

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Insurance Policies" is hereby amended by adding thereto the following section:

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     27-18-82. Notice of cancellation -- Certified mail. -- Any individual, partnership,

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corporation, or unincorporated association providing health insurance coverage under this chapter

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for its employees shall furnish each insured employee, upon cancellation or discontinuation of

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such health insurance, notice of the cancellation or discontinuation of such insurance. The notice

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shall be sent by certified mail to the insured employee not less than fifteen (15) days next

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preceding the effective date of cancellation or discontinuation. Any individual or any such entity

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which fails to provide timely notice shall be fined not more than one thousand dollars ($1,000)

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for each violation. This section shall apply to any such individual, partnership, corporation or

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unincorporated association which substitutes one policy providing such group health insurance

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coverage for another such policy with no interruption in coverage.

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     SECTION 2. Chapter 27-19 of the General Laws entitled "Nonprofit Hospital Service

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Corporations" is hereby amended by adding thereto the following section:

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     27-19-73. Notice of cancellation -- Certified mail. -- Any individual, partnership,

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corporation, or unincorporated association providing health insurance coverage under this chapter

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for its employees shall furnish each insured employee, upon cancellation or discontinuation of

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such health insurance, notice of the cancellation or discontinuation of such insurance. The notice

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shall be sent by certified mail to the insured employee not less than fifteen (15) days next

 

1

preceding the effective date of cancellation or discontinuation. Any individual or any such entity

2

which fails to provide timely notice shall be fined not more than one thousand dollars ($1,000)

3

for each violation. This section shall apply to any such individual, partnership, corporation or

4

unincorporated association which substitutes one policy providing such group health insurance

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coverage for another such policy with no interruption in coverage.

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     SECTION 3. Chapter 27-20 of the General Laws entitled "Nonprofit Medical Service

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Corporations" is hereby amended by adding thereto the following section:

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     27-20-69. Notice of cancellation -- Certified mail. -- Any individual, partnership,

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corporation, or unincorporated association providing health insurance coverage under this chapter

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for its employees shall furnish each insured employee, upon cancellation or discontinuation of

11

such health insurance, notice of the cancellation or discontinuation of such insurance. The notice

12

shall be sent by certified mail to the insured employee not less than fifteen (15) days next

13

preceding the effective date of cancellation or discontinuation. Any individual or any such entity

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which fails to provide timely notice shall be fined not more than one thousand dollars ($1,000)

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for each violation. This section shall apply to any such individual, partnership, corporation or

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unincorporated association which substitutes one policy providing such group health insurance

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coverage for another such policy with no interruption in coverage.

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     SECTION 4. Chapter 27-20.1 of the General Laws entitled "Nonprofit Dental Service

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Corporations" is hereby amended by adding thereto the following section:

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     27-20.1-23. Notice of cancellation -- Certified mail. -- Any individual, partnership,

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corporation, or unincorporated association providing health insurance coverage under this chapter

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for its employees shall furnish each insured employee, upon cancellation or discontinuation of

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such health insurance, notice of the cancellation or discontinuation of such insurance. The notice

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shall be sent by certified mail to the insured employee not less than fifteen (15) days next

25

preceding the effective date of cancellation or discontinuation. Any individual or any such entity

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which fails to provide timely notice shall be fined not more than one thousand dollars ($1,000)

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for each violation. This section shall apply to any such individual, partnership, corporation or

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unincorporated association which substitutes one policy providing such group health insurance

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coverage for another such policy with no interruption in coverage.

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     SECTION 5. Chapter 27-41 of the General Laws entitled "Health Maintenance

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Organizations" is hereby amended by adding thereto the following section:

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     27-41-86. Notice of cancellation -- Certified mail. -- Any individual, partnership,

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corporation, or unincorporated association providing health insurance coverage under this chapter

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for its employees shall furnish each insured employee, upon cancellation or discontinuation of

 

LC004183 - Page 2 of 4

1

such health insurance, notice of the cancellation or discontinuation of such insurance. The notice

2

shall be sent by certified mail to the insured employee not less than fifteen (15) days next

3

preceding the effective date of cancellation or discontinuation. Any individual or any such entity

4

which fails to provide timely notice shall be fined not more than one thousand dollars ($1,000)

5

for each violation. This section shall apply to any such individual, partnership, corporation or

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unincorporated association which substitutes one policy providing such group health insurance

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coverage for another such policy with no interruption in coverage.

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     SECTION 6. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO INSURANCE -- CANCELLATION OF POLICIES

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     This act would require employers to furnish employees notice of cancellation or

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discontinuation of health insurance by certified mail and would also establish a fine of one

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thousand dollars ($1,000) for each violation.

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     This act would take effect upon passage.

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