Ins 3.465(3)(b)4.
4. Be accompanied by a clear disclosure that the policy is intended to be a qualifying partnership policy. The disclosure shall be in the format contained in Appendix 1.
Ins 3.465(3)(b)6.
6. Not base underwriting criteria upon whether or not the policy is a qualifying partnership policy.
Ins 3.465(4)
(4)
Form requirements for qualifying partnership policies. An insurer that offers a long-term care insurance policy that is intended to qualify an insured under the state's partnership program shall comply with all of the following:
Ins 3.465(4)(a)
(a) File the policy, outline of coverage, premium rates, and actuarial memorandum to the commissioner in accordance with s.
631.20, Stats., and s.
Ins 3.455, and include the qualifying partnership policy certification form.
Ins 3.465 Note
Note:
The qualifying partnership policy certification form (OCI No. 26-113) can be obtained from the Office of the Commissioner of Insurance at no cost from the OCI website
http://oci.wi.gov or by writing to the State of Wisconsin Office of the Commissioner of Insurance 125 S. Webster, Madison, WI 53703.
Ins 3.465(4)(b)
(b) Submit the qualifying partnership policy certification form to the commissioner, prior to use, for approval if an insurer intends to use a previously approved policy to qualify as a qualifying partnership policy.
Ins 3.465(4)(c)
(c) File the endorsement or rider and submit the qualifying partnership policy certification form to the commissioner, prior to use, for approval if the insurer intends to amend a previously approved policy with an endorsement or rider, as needed, to qualify the policy as a qualifying partnership policy.
Ins 3.465(4)(d)
(d) Certification shall be in the format specified by the commissioner and identified as OCI No. 26-113, and comply with the following:
Ins 3.465(4)(d)1.
1. The certification shall be made and signed by an officer of the insurer having the authority to bind the insurer and shall include full contact information for the certifying officer.
Ins 3.465(4)(d)2.
2. The certification for pars.
(b) and
(c) shall identify the policy by the original form number and approval date.
Ins 3.465(5)
(5)
Inflation protection requirements. An insurer offering a long-term care insurance policy that is intended to qualify an insured under the state partnership program shall comply with the following inflation protection provisions.
Ins 3.465(5)(a)
(a) For a person who is less than 61 years of age as of the date of purchase of the policy, the policy shall provide compound annual inflation protection that complies with one of the following:
Ins 3.465(5)(a)1.
1. Provide and maintain a level premium that contains automatic annual compounded inflation increases at a rate that is at least 3%.
Ins 3.465(5)(a)2.
2. Provide and maintain a level premium that contains automatic annual compounded inflation increases at a rate based on changes in the consumer price index.
Ins 3.465(5)(a)3.
3. Provide for annual compounded inflation increases at a rate that is at least 3% and meet all of the following requirements:
Ins 3.465(5)(a)3.a.
a. Each benefit increase occurs automatically, unless the insured specifically rejects an increase.
Ins 3.465(5)(a)3.b.
b. The increases shall be provided until the insured has at least attained age 76 and each increase up to and including the increase that takes effect at age 76 may not be rejected by the insured in order to retain qualifying partnership policy status.
Ins 3.465(5)(a)3.c.
c. Increases may end when the insured has attained age 76, rejected an offer of inflation increase, or becomes eligible for benefits on or after age 76.
Ins 3.465(5)(a)3.d.
d. The additional premium for each increase under this feature may be based on the premium rates that apply to the insured's attained age at the time of the increase.
Ins 3.465(5)(a)3.e.
e. Rejection of an increase may not limit the coverage under the policy, except for the asset disregard feature of a qualified partnership policy, and from the insured receiving future premium increases as contemplated in s.
Ins 3.455.
Ins 3.465(5)(b)
(b) For a person who is at least 61 years of age but less than 76 years of age as of the date of purchase of the policy, the policy shall provide inflation protection that meets the requirements of par.
(a) or an inflation protection feature that provides at least 3% annual simple inflation protection.
Ins 3.465(5)(c)
(c) For a person who is at least 76 years of age as of the date of purchase of the policy, the policy may provide inflation protection with terms no less restrictive than those identified in pars.
(a) and
(b), but inflation protection is not required.
Ins 3.465(6)
(6)
Disclosure when soliciting. In addition to the requirements of s.
Ins 3.46, an insurer issuing or marketing a policy that is intended to qualify an insured for the state's partnership program shall explain at the time of solicitation the benefits associated with a qualifying partnership policy and comply with all of the following:
Ins 3.465(6)(a)1.1. An insurer or its intermediary shall provide to each prospective applicant all of the following:
Ins 3.465(6)(a)1.a.
a. Qualifying partnership policy notices in the format contained in Appendix 1 and 2.
Ins 3.465(6)(a)2.
2. No insurer or intermediary shall be responsible for providing applicants the revised guides until 90 days after the insurer or intermediary has been given notice that the revised guides are available.
Ins 3.465(6)(b)
(b) For a qualifying partnership policy issued to a group when an outline of coverage is not delivered, the insurer or intermediary shall deliver copies of the qualifying partnership policy disclosure notice, The Guide to Long-term Care booklet, and The Wisconsin Long-term Care Programs guide.
Ins 3.465(6)(c)
(c) For a life insurance policy that offers long-term care insurance as a provision in the policy or in a rider that is intended to qualify an insured under the state's partnership program, the insurer or intermediary at the time of solicitation shall deliver the disclosure notice (Appendix 1), the Guide to Long-term Care booklet, and the Wisconsin Long-term Care Programs guide.
Ins 3.465(7)(a)(a) When an insurer is made aware that the insured or certificateholder initiated a policy change request or declined a benefit increase that will result in the loss of the status as a qualifying partnership policy, the insurer shall provide, in writing, an explanation of how such action impacts the insured. The insurer shall also advise the insured or certificateholder of how to retain the policy as a qualified partnership policy, if requested.
Ins 3.465(7)(b)
(b) If a qualifying partnership policy no longer meets the requirements of the state's partnership program, the insurer shall explain, in writing, to the policyholder or certificateholder the reason for the loss of status.
Ins 3.465(7)(c)
(c) The insurer shall provide a completed qualifying partnership policy summary document in the format of OCI No. 26-114, when requested by the insured or the insured's authorized representative.
Ins 3.465(8)
(8)
Exchange of long-term care insurance policy to a qualifying partnership policy. Ins 3.465(8)(a)1.1. Insurers offering long-term care policies that are intended to qualify an insured under the state's partnership program are subject to s.
Ins 3.455 (9m).
Ins 3.465(8)(a)2.
2. Insurers issuing an automatic exchange shall comply with all of the following:
Ins 3.465(8)(a)2.a.
a. Only a policy that requires no modifications or additions is eligible for an automatic exchange.
Ins 3.465(8)(a)2.c.
c. The rate used in determining the premium charged for the new policy shall be determined using the original issue age and risk class of the insured that was used to determine the rate of the existing policy and may not contemplate that the new policy is a qualified partnership policy.
Ins 3.465(8)(a)2.d.
d. Insurers issuing automatic exchanges shall provide insureds, at the time of notice of the automatic exchange, a copy of Appendix 1, the Guide to Long-Term Care booklet and the Wisconsin Long-Term Care Programs guide. After issuance of the notice for automatic exchange, if the insured does not decline the offer, the insurer shall provide the insured a copy of Appendix 2.
Ins 3.465(8)(a)2.e.
e. Insurers issuing an automatic exchange shall offer to the insured, at the time of notice of the automatic exchange, the option to decline the automatic exchange and retain the existing policy if the insured responds within a period of time not less than 120 days.
Ins 3.465(8)(a)3.
3. An insurer offering an exchange as to a qualifying partnership policy with an actuarial value of benefits exceeding the actuarial value of benefits of the existing policy shall be subject to all of the following:
Ins 3.465(8)(a)3.b.
b. The insurer shall apply its new business long-term care underwriting guidelines to the increased benefits only.
Ins 3.465(8)(a)3.c.
c. The premium charged for the new policy shall be determined using the method in subd.
3. for existing benefits and the rate for the additional benefits using the then current age and risk class of the insured for the additional benefits only.
Ins 3.465(8)(a)4.
4. An insurer shall maintain documentation of the actuarial value analysis determination and shall provide the analysis to the commissioner upon request.
Ins 3.465(8)(b)
(b) Offer of exchange. An insurer that submits and receives approval to offer a long-term care insurance policy that is intended to be a qualifying partnership policy in this state may, subject to the following requirements, offer an exchange:
Ins 3.465(8)(b)1.
1. Within one year from the date the insurer begins to advertise, market, offer, sell, or issue policies that are intended to be qualifying partnership policies, on a one-time basis in writing, offer to all existing policyholders or certificateholders that were issued long-term care coverage by the insurer with an issue date on or after February 8, 2006, the option to exchange their existing long-term care policy for a qualifying partnership policy. Insurers may offer the exchange option to policyholders or certificateholders with long-term care policies issued prior to February 8, 2006, pursuant to a plan filed with the commissioner.
Ins 3.465(8)(b)2.
2. The offer shall be made on a nondiscriminatory basis without regard to the age or health status of the insured.
Ins 3.465(8)(b)3.
3. The offer shall remain open for a minimum of 120 days from the date of the mailing by the insurer.
Ins 3.465(8)(b)4.
4. The effective date of the partnership plan policy shall be the date of the exchanged policy.
Ins 3.465(8)(b)5.
5. In the event of an exchange, the insured may not lose any rights that have accrued under the original policy including, but not limited to, rights established because of the lapse of time related to pre-existing condition exclusions, elimination periods, or incontestability clauses.
Ins 3.465(8)(b)6.
6. The written offer to exchange shall include the disclosure form contained in Appendix 2 and also shall include the Guide to Long-Term Care booklet and the Wisconsin Long-Term Care Programs guide. The insurer shall file with the commissioner, prior to use and for informational purposes, the exchange letter to be used in the exchange offer.
Ins 3.465(8)(c)1.1. The new policy offered in an exchange or automatic exchange shall be of a form that is offered for sale by the insurer in the general market at the time of exchange.
Ins 3.465(8)(c)2.
2. A policy received in an exchange on or after January 1, 2009, is treated as newly issued and thus is eligible for partnership program status. For purposes of applying the Medicaid rules relating to the state partnership program, the addition of a rider, endorsement, or change in schedule page for a policy may be treated as giving rise to an exchange.
Ins 3.465(8)(d)1.a.
a. The policy is issued to a local, municipal, county, or state public employee group.
Ins 3.465(8)(d)1.b.
b. The group coverage was negotiated as part of a collective bargaining agreement.
Ins 3.465(8)(d)1.c.
c. The group coverage is provided to all eligible employees on a guaranteed issue basis.
Ins 3.465(8)(d)1.d.
d. The policy provides insureds with at least 5% compound annualized inflation protection.
Ins 3.465(8)(d)1.f.
f. No later than one year from the date the insurer begins to advertise, market, offer, sell, or issue policies that are intended to be qualifying partnership policies, the insurer shall provide notice that the policy meets the requirements of a qualifying partnership plan and shall provide the insureds with Appendix 1, the Guide to Long-Term Care booklet and the Wisconsin Long-Term Care Programs guide. The insurer shall file with the commissioner, prior to use and for informational purposes, the exchange letter to be used in the exchange offer.
Ins 3.465(8)(d)1.g.
g. To accomplish an automatic exchange the insurer shall apply the exchange to all group members.
Ins 3.465(8)(d)1.h.
h. The effective date of the qualifying partnership policy shall be the date of the exchanged policy.
Ins 3.465(8)(d)1.i.
i. In the event of an exchange, the insured and its certificateholders may not lose any rights that have accrued under the original policy including, but not limited to, rights established because of the lapse of time related to pre-existing condition exclusions, elimination periods, or incontestability clauses.
Ins 3.465(8)(d)2.
2. Notwithstanding par.
(b), an insurer is not required to offer an exchange to an individual who is eligible for benefits or within an elimination period or who is, or who has been in, claim status on or after January 1, 2009, or who would not be eligible to apply for coverage due to issue age limitations under the new policy. The insurer may require that policyholders or certificateholders meet all eligibility requirements, including plan design, underwriting, if applicable, and payment of the required premium.
Ins 3.465 History
History: EmR0817: emerg. cr. eff. 6-3-08;
CR 08-032: cr.
Register October 2008 No. 634, eff. 11-1-08.
Ins 3.465 Note
Note:
CR 08-032 first applies to policies or certificates issued on or after January 1, 2009 or on the first renewal date on or after January 1, 2009, but no later than January 1, 2010 for collectively bargained policies or certificates.
Ins 3.465 APPENDIX 1
PARTNERSHIP POLICY STATUS DISCLOSURE NOTICE
Important Notice Regarding Your Policy's Long-Term
Care Insurance Partnership Plan Status
(Please Keep This Notice With Your Policy or Certificate)
The Wisconsin Long-Term Care Insurance Partnership Program (Wisconsin Partnership Program) is a partnership between the State of Wisconsin and private insurers of long-term care insurance policies [certificates]. The Wisconsin Partnership Program became effective on January 1, 2009. This Notice explains the Medicaid asset protection that you may receive being insured under a Partnership Policy [Certificate].
Notice of Partnership Plan Policy Status. Your long-term care insurance policy [certificate] is intended to qualify as a Qualifying Partnership Policy [Certificate] under the Wisconsin Long-Term Care Insurance Partnership Program as of your policy's [certificate's] effective date.
You should also be aware that insurers are required to provide personally identifying information, including your name, to the federal government to be entered into a federal data base to which state Medicaid departments will have access.
Medicaid Asset Protection Provided by the State Medicaid Program. Long-term care insurance is one tool that helps individuals prepare for future long-term care needs. The purchase of a Qualifying Partnership Policy [certificate] does not automatically qualify you for Medicaid.
In particular, such policies [certificates] may permit individuals to protect assets from spend-down requirements under Wisconsin's Medicaid program if assistance under this program is ever needed and you otherwise qualify for Medicaid.
Specifically, the asset eligibility and recovery provisions of the Wisconsin Medicaid program are applied by disregarding the amount of assets equal to the amount of insurance benefits you have received from your Qualifying Partnership Policy [Certificate]. The disregarded assets are also exempt from estate recovery. For example, if you receive $200,000 of insurance benefits from your Qualifying Partnership Policy [Certificate], you generally would be able to retain $200,000 of assets above and beyond the amount of assets normally permitted for Medicaid eligibility.
Other Medicaid eligibility requirements apart from permissible assets shall be met, including special rules that may apply if the equity in your home exceeds [$750,000]. In addition, you shall meet the Medicaid program's income requirements and may be required to contribute some of your income to the costs of your care once you become eligible for Medicaid. Medicaid eligibility requirements may vary by county and may change over time. Medicaid eligibility requirements may also be different from state to state.
Additional Consumer Protections. In addition to providing Medicaid asset protection, your Partnership Policy [Certificate] has other important features. Under the rules governing Wisconsin's Long-Term Care Insurance Partnership Program, your Qualifying Partnership Policy [Certificate] shall be a tax-qualified long-term care insurance contract under Federal tax law, and as such the insurance benefits you receive from the policy generally will not be subject to income tax. (Please note that a policy or certificate can be a qualified long-term care insurance contract under Federal and State income tax law, with the same income tax treatment, even if it is not a Qualifying Partnership Policy [Certificate].) In addition, if you were under age 76 when you purchased your Qualifying Partnership Policy [Certificate], it shall provide inflation protection to help protect against potential future increases in the cost of long-term care. (For older purchasers, only an offer of inflation protection is required.)
What Could Disqualify Your Policy as a Partnership Policy [Certificate]. If you make any changes to your policy or certificate, such changes could affect whether your policy [certificate] continues to be a Qualifying Partnership Policy [Certificate]. Before you make any changes, you should consult with the [carrier's name] to determine the effect of a proposed change. In addition, if you move to a state that does not maintain a Partnership Program or does not recognize your policy as a Qualifying Partnership Policy [Certificate], you would not receive Medicaid asset protection in that state. However, the coverage contained in your policy would not be affected. Also, changes in Federal or State law could modify, reduce or eliminate the Medicaid asset protection available with respect to your Qualifying Partnership Policy [Certificate] after you have purchased the policy.
Additional information. If you would like further information about the Medicaid asset protection provided by your Qualifying Partnership Policy [Certificate] or the Wisconsin's Long-Term Care Insurance Partnership Program, please contact State of Wisconsin Member Services at 1-800-362-3002.
Ins 3.465 APPENDIX 2
