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DOI Clarifies Maternity Law’s Impact on Premiums in Colorado

March 16th, 2011 – Colorado’s Division of Insurance just provided more clarification on the new maternity regulations for individual/family health insurance plans and how they may impact rates for existing individual and family (non group) health insurance policy holders in Colorado.

For health insurance policies that have renewed since January 1, 2011, consumers may be billed retroactively for the additional coverage for the months in 2011 for which they were covered by an individual policy.

Key elements of the law include:

  • Insurance companies must provide maternity coverage on all newly issued and renewing major medical individual insurance policies in Colorado as of January 1, 2011, regardless of the policyholder’s gender or age. If a consumer currently has individual health insurance, but the policy renewal date isn’t until later in the year, both the maternity coverage and the increased premium will begin on the renewal date.
  • Insurance companies that did not add maternity coverage to policies and did not adjust premium rates for required maternity coverage may elect to bill customers retroactively for the maternity coverage beginning January 1, 2011. Alternatively, the insurance company could provide the required maternity coverage beginning January 1, 2011 and absorb the additional cost by electing to not increase the consumer’s monthly premium until the renewal date of the consumer’s policy.
  • Insurance companies that did not file premium rates with the Division of Insurance which included the mandated maternity coverage must file those rates for prior approval before additional premium may be charged. The Division of Insurance must approve the new rate before the new rate can be used.
  • As of January 1, individuals, who are pregnant prior to purchasing insurance or prior to their policy’s renewal date, should expect that the pregnancy will be considered a preexisting condition and will not be covered by the mandate. Pregnancies which occur after insurance coverage has been secured or renewed will be covered.
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