KANSAS INSURANCE DEPARTMENT
Notice
of Hearing on Proposed
Administrative
Regulation
A
public hearing will be conducted at 1:30 p.m.,
The
60-day notice of the public hearing shall constitute a public comment period
for purpose of receiving written public comments on the proposed rule and
regulation. All interested parties may
submit written comments prior to the hearing to John Wine,
A summary of the proposed regulation
and its economic impact follows.
K.A.R. 40-4-36. Accident and sickness
insurance; continuation and conversion policies; reasonable notice of
right to continuation and right to convert. This
regulation is being amended to comply with changes made by 2008 Senate Bill 81
(L.2008, Ch. 164), which amended K.S.A. 40-19c06 and 40-2209. The existing regulation provided the requirements
for reasonable written notice by an insurer to employees and an employee's
covered dependents of their right to continuation of group accident and
sickness insurance coverage as provided in K.S.A. 40-19c06 and 40-2209. Senate Bill 81 specifically amended K.S.A.
40-2209(j)(3) to now require employers, not insurers,
to provide reasonable notice of the right to continuation of coverage and
requires employees and their covered dependents to pay premiums to the
employer, rather than the insurer.
The proposed amendment to K.A.R. 40-4-36 is
not mandated by federal law.
There will be a positive economic impact on
insurers, who are no longer required to provide the notice of right to continue
coverage to group employees. The cost of
providing notice to former employees and their covered dependents, as well as
the collection of premiums, will now be the responsibility of employers,
including small business owners, who are now required to assume these statutory
duties. Small business owners, in
particular, may not have sufficient staff or administrative capacity to prepare
and issue appropriate notices or follow up on the collection and payment of
premiums from former employees and their covered dependents. Since SB 81 imposes no penalty on employers
who fail to provide the required notice, employees and their covered dependents
may experience an economic impact if they fail to receive notice of their
continuation rights and are unaware of their rights to continuation of their
health insurance coverage. Since the
Kansas Insurance Department has no regulatory authority over employers, there
will be no economic impact on the Department.
The language of SB 81 requires the proposed
amendment to the regulation and provided no other method for achieving the stated
purpose.
Any individual with a disability may request accommodation in
order to participate in the public hearing and may request the proposed
regulation and the economic impact statement in an accessible format. Requests for accommodation to participate in
the hearing should be made at least 5 working days in advance by contacting
John Wine at (785) 296-7847 or via email at jwine@ksinsurance.org. Any individual desiring a copy of this
regulation and/or the policy and procedure that is being adopted by reference,
if applicable, may obtain a copy from our website, www.ksinsurance.org,
under the Legal Issues link or by contacting John Wine by phone at
(785)296-7847 or via email at jwine@ksinsurance.org. The charge for copies is fifty cents per
page.