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State Extension Rights

In addition to the right of the employee to have a converted policy issued, the employee has the right to continue coverage under the group policy for a period of twelve (12) months.

STATE EXTENSION REQUIREMENTS AND APPLICABLE CODE SECTIONS

ELIGIBILTY (same eligibility requirements as for state conversion, see Utah Coded Annotated (U.C.A.), Sections 31A-22-703 and 31A-22-704.

  • A individual whose insurance under the group policy has been terminated for any reason; and
  • The individual has been continuously insured under the group policy or its predecessor for at least 3 months immediately prior to termination;
  • The individuals termination of group coverage did not occur because of their failure to pay required contribution;
  • The individual does not acquire other group coverage covering all preexisting conditions;
  • The individual is not eligible to continue coverage under the existing group policy in accordance with the terms of the policy;
  • The individual was not terminated for gross misconduct;
  • The individual is not eligible for any extension of coverage required by federal law.

NOTIFICATION

  • The employer is responsible to provide the terminated insured written notification of the right to continue group coverage and the payment amounts required to continue coverage. This notice should be provided to the terminated insured within thirty (30) days after the date group coverage terminates, and should specify the manner, place, and time in which the payment shall be made.

PREMIUMS

  • The payment amount for continued group coverage may not exceed 102% of the group rate.

RULES AND PROCEDURES

  • Continuation of coverage is elected and premiums must be given to the employer within thirty (30) days after receiving notice.
  • The terminated insured continues coverage without interruption unless:
  1. The terminated insured ceases to reside in this state;
  2. The terminated insured fails to make timely payment;
  3. The terminated insured violates a material condition of the contract;
  4. The terminated insured becomes eligible for similar coverage under another group policy; or
  5. The employer’s coverage is terminated.
  • If the employer replaces coverage with coverage under another group policy, the terminated insured has the right to obtain coverage under the replacement group plan.
  • At the end of the extension of benefit period the covered person is eligible for a conversion policy.

APPLICABLE UTAH CODE SECTIONS FOR REVIEW

  • U.C.A. § 31A-22-703, Conversion rights on termination of group disability insurance coverage.
  • U.C.A. § 31A-22-704, Conversion rules and procedures.
  • U.C.A. § 31A-22-714, Extension of benefits.
  • U.C.A. § 31A-22-710, Conversion privilege of spouse and children.

HIPAA FEDERAL REGISTER CITES

  • Health Insurance Portability for Group Health Plans; Interim Rules and Proposed Rule. Federal Register / Vol. 62, No. 67/ Tuesday, April 8, 1997 / Rules and Regulation.
  • Section 144.103, COBRA definition, (4) Continuation Coverage.