COVENTRY HEALTH AND LIFE INSURANCE COMPANY Administrative Offices: 6705 Rockledge Drive, Suite 900, Bethesda, Maryland 20817 (Hereinafter referred to as "Company") State: Virginia Policyholder: Employer (Policyholder above, unless stated here): Subsidiaries and affiliates whose Employees are insured by this Agreement/Policy: Issue Date: Annual Renewal of the Group Agreement/Policy will be effective on: This Agreement/Policy is delivered in the State named above. It is governed by State laws. If any part(s) of this Agreement/Policy is contrary to such laws, that part(s) is amended to conform. The first Premium is due on the Issue Date. Renewal Premiums are due monthly on the first day. On and after the Issue Date, the Company will provide insurance for each Covered Individual. THIS IS SUBJECT TO THE TERMS AND CONDITIONS IN THIS AGREEMENT/POLICY. It is also subject to the Company Home Office's approval of this Agreement/Policyholder application and receipt of Premiums when due. This Agreement/Policy, the Group Application, the Employee's Certificate of Insurance, the Schedule of Benefits, the Employee's Enrollment/Change Forms and any riders or amendments attached hereto are the entire contract between the parties. Coventry Health and Life Insurance Company executes this Agreement/Policy the day of, 20. READ YOUR AGREEMENT/POLICY CAREFULLY. CHL.GA.09 (VA)
GROUP AGREEMENT/POLICY TABLE OF CONTENTS Definitions 2 I. Included Employers 4 II. Policyholder Provisions 4 III. Company Provisions 6 IV. Records 9 V. General Provisions 9 VI. Disclosure of Protected Health Information (PHI) 11 DEFINITIONS Actively at Work, Active Work, and Actively Working Spending time and energy in the service of the Employer as an eligible Employee as defined in the Group Application. Service must total at least the number of hours required by the Employer for eligibility. An Employee is considered Actively at Work on the following days: a full normal work day of his or her regular duties. a weekend, except for one or both of these days if they are scheduled days of work; holidays, unless such holiday is a scheduled work day; paid vacations; any regularly scheduled non-working day; any non-scheduled non-working day; excused leave of absence, including medical leave; and emergency leave of absence, including emergency medical leave. Affiliated Company The Company s parent company is Coventry Health Care, Inc. ( Coventry ). Coventry is the parent company of several managed care companies, health maintenance organizations, insurance companies, third party administrators, and network rental companies. Coventry and its subsidiaries are considered Affiliated Companies. These Affiliated Companies include, but are not limited to, Carelink Health Plans, Inc., WellPath Select, Inc., Southern Health Services, Inc., and First Health Group Corp. Affiliated Product A health care product offered or administered by an Affiliated Company. Certificate of Insurance The document describing Covered Services, Deductibles, Coinsurance, limitations, and exclusions. The Schedule of Benefits is an integral part of the Certificate of Insurance. Contributory The Employee pays a part of the cost of the insurance premium. Coventry Health and Life Insurance Company (the Company, We, Us) The insurance company licensed in Virginia and domiciled in Delaware. The address of the administrative offices is 6705 Rockledge Drive, Suite 900, Bethesda, MD 20817. The Company is subject to regulation in Virginia by both the State Corporation Commission under Title 38.2 of the Code of Virginia and the Virginia Department of Health under Title 32.1 of the Code of Virginia. 2
Covered Classes The classes of Employees of the Employer to which the insurance under a Schedule of Benefits applies. For groups of 2-50 employees, all Eligible Employees who do not complete a waiver of coverage will be covered. Where different Covered Classes exist, the Company will not assign a Covered Class based on health status. Covered Individual An Eligible Employee and his/her Qualified Dependents whose insurance under the Group Agreement/Policy is in effect. Covered Services The services or supplies provided to the Covered Individual for which the Company will pay as described in the Employee Certificate of Insurance and Schedule of Benefits. Eligible Dependent Any of the following for whom an Employee may get insurance as a Dependent(s): An Employee's Spouse. An Employee's unmarried Dependent children under the cut-off age specified in the Group Application. Dependent children include: a newborn child or child adopted or placed for adoption with the Employee; a child required to be enrolled pursuant to the terms of a Qualified Medical Child Support Order; or any other child for whom the Employee is a legal guardian. Eligible Employee As defined by Employer. For groups of 2-50 Eligible Employees, this term shall mean an Employee who works on a full-time basis, has a normal work week of at least twenty-five (25) or more hours, has satisfied applicable waiting period requirements, and is not a part-time, temporary, or substitute employee. An Eligible Employee shall also mean an Employee who is regularly scheduled to work those hours per week and months per year as defined by Policyholder in the Group Application, thereby making that Employee eligible for Covered Services under the terms of this Agreement/Policy. Employee The person who has met all of the conditions for insurance as set forth in Section 8 of the Certificate of Insurance and whose insurance has become effective. Employer (Included Employer, subsidiaries, affiliates) The Employer, subsidiary or affiliate stated in this Group Agreement/Policy. Enrollment/Change Form Our form, which the Employee completes before his/her effective date. This form allows the Employee to have health care coverage through Us. Grace Period The period after the premium due date when the Agreement/Policy remains in effect, as stated in the Group Agreement/Policy. Group Agreement/Policy (Agreement/Policy) The Certificate of Insurance along with the Group Application, Group Agreement/Policy, Schedule of Benefits, Enrollment/ Change Forms, and amendments, if any, between Us and the Policyholder shown on page 1 of the Group Agreement/Policy. Officer of Coventry Health and Life Insurance Company (Officer of the Company) The President, Vice President, Secretary, or Assistant Secretary of the Company. Policyholder The legal entity named as Policyholder in this Group Agreement/Policy. This entity contracts with Us to provide health insurance for its Employees and their Qualified Dependents. State The State in which the Group Agreement/Policy is sold. 3
I. INCLUDED EMPLOYERS Included Employers under this Agreement/Policy are the Policyholder and any subsidiaries and affiliates listed on Page 1. Under this Agreement/Policy, Employees of more than one Included Employer are considered Employees of only one. Their service with all other Included Employers is treated as service with that one. When an Employer stops being an Included Employer, this Agreement/Policy ends for all its Employees. The exception is Employees who are still in Covered Classes of the Agreement/Policy as Employees of another Included Employer on the day after the Agreement/Policy ends. If a subsidiary or affiliate stops being such, the Policyholder must tell the Company. This must be done in writing as soon as possible but no later than thirty (30) days before the date of the change. II. POLICYHOLDER PROVISIONS A. Effect of Actions on Policyholder In all Agreement/Policy matters, the Policyholder acts for the Employer, subsidiaries, and affiliates as listed herein. Agreements made with the Policyholder are binding on all such parties. Each notice given to the Policyholder is deemed given to all such parties. B. Record of Employees Insured As required to administer this insurance, the Policyholder will give the Company information about Covered Individuals: Who qualify to become insured. Whose amounts of insurance change. Whose Covered Classes change. Whose insurance ends for any reason. If the Agreement/Policyholder errs in giving such information, this Agreement/Policy is administered as if the right information was given. The Company may check the Employer's and/or Policyholder's records which, in its opinion, relate to this insurance. C. Payment of Premiums All premiums for this Agreement/Policy are paid by the Policyholder to the Company through Southern Health or any of its Affiliated Companies. This includes adjustments, COBRA premiums, or continuation of coverage premiums under Section III.E. Nonpayment by a COBRA Policyholder, retiree, or other persons continuing coverage will result in termination after the thirty-one (31)-day grace period for that Employee and any Dependents. Coverage for the entire group will not be affected by such nonpayment. Premiums must be paid on or before their due dates (see Page 1). They are only considered paid when received at the Company. However, the initial premium will be submitted to Southern Health along with the Group Application and Employee Enrollment/Change Forms. All checks should be made payable to Coventry Health and Life Insurance Company. Payment of any renewal premium will not keep this insurance in force beyond the day before the next renewal premium due date, except as stated in Section II.D. If Group fails to make payment of premium by the due date but within the Grace Period for timely payment more frequently than any two (2) months while Group is covered continuously by Company, then Company may impose a late penalty not to exceed 2% of the premiums due for the month in which the payment was late. D. Grace Period This Policyholder has a Grace Period beyond the due date to pay the renewal premium in full. It is thirty-one (31) days after the due date. This Agreement/Policy stays in force during the Grace Period. If the premium is not paid in full before the Grace Period ends, this Agreement/Policy terminates immediately following the last day of the Grace Period. The Policyholder may tell the Company in writing before or during the Grace Period that it wants to end this Agreement/Policy before the end of the Grace Period. This Agreement/Policy then ends on the date the notice is received by the Company or the date stated in the notice, whichever is later. 4
ON THE DATE THIS AGREEMENT/POLICY ENDS, THE POLICYHOLDER MUST PAY COVENTRY HEALTH AND LIFE INSURANCE COMPANY ALL PREMIUMS DUE. THIS INCLUDES PREMIUMS DUE FOR ALL OR ANY PART OF THE GRACE PERIOD WHILE THE AGREEMENT/POLICY WAS IN FORCE AS WELL AS ANY INTEREST PENALTY IMPOSED. E. Premium Adjustment No unearned premium will be returned to the Policyholder for any period before the most recent renewal. Group agrees to remit promptly to the Company an additional full monthly premium (if required under the applicable type of coverage) for each Covered Individual who becomes covered hereunder before the sixteenth (16 th ) day of the month preceding the next month's coverage and for whom payment for such month was not received. It is understood that if the addition of such Covered Individual causes Eligible Employee's type of coverage to change (i.e., single coverage to family coverage), the premium for such changed coverage shall be applicable. For each Covered Individual who becomes covered hereunder on or following the sixteenth (16 th ) day of the month preceding the next month's coverage, no additional premium for such person will be required for that month. When a Covered Individual's coverage is terminated on or following the sixteenth (16 th ) day of the month, the full monthly premium will be due for that month. If the Covered Individual's coverage is terminated before the sixteenth (16 th ) day, the monthly premium for that month will not be owed. For Groups whose original effective date occurs on the fifteenth (15 th ) of the month, the Group s first month s premium payment will be prorated when previously approved by the Company. F. Premium Refunds - Employee Portion For Contributory insurance, any premium refund that is more than the Policyholder's contributions must be used solely for the benefit of the Employees. The Policyholder, not the Company, is responsible to see that premium refunds are so used. G. Entire Agreement/Policy; Applications This Agreement/Policy, its supplemental riders or amendments, along with the Group Application forms, the Employee Certificate of Insurance, the Schedule of Benefits, and Enrollment/Change Forms of the Covered Individuals is the entire Agreement/Policy between the Policyholder and the Company. A copy of the Group Application forms shall be attached to the Agreement/Policy when issued. No written statement made by a Covered Individual shall be used in any context unless a copy of the statement is given to the Covered Individual, his/her beneficiary, or his/her personal representative. Any statement made by the Policyholder or Covered Individual shall be deemed a representation and not a warranty. H. Individual Certificates The Company will issue to the Policyholder for delivery to each subscriber a Certificate of Insurance and Schedule of Benefits setting forth: 1. The Covered Individual's coverage, including any limitations, reductions, and exclusions applicable to the coverage; 2. To whom the insurance benefits are payable; 3. Any family member's or dependent's coverage; and 4. The conversion or continuation rights afforded under Section 8 of the Employee Certificate of Insurance. I. Notice of Termination Policyholder shall give written notice to participating Employees in the event of Agreement/Policy termination or upon the receipt of notice of Agreement/Policy termination. This written notice shall be provided to such Employees not later than fifteen (15) days after receipt of notice of such Agreement/Policy termination. J. Medicare Carve-Out For groups that have a Medicare Carve-Out premium, Eligible Employees and/or their Eligible Dependents who are Medicare eligible and (1) are retirees, spouses of retirees, or age sixty-five (65) or older; (2) are disabled and not actively employed or disabled and the Dependent of retiree; or (3) have End Stage Renal Disease must accept and be covered by both Parts A and B of Medicare in order to obtain the carve-out premium. The Covered Individual is responsible for notifying the Company immediately in the event the Eligible Employee or Eligible Dependent either loses Medicare coverage or discontinues Part B. As a result of such status change or discontinuance of Medicare Part B coverage, the Covered Individual will no longer be eligible for the carve-out premium. Additionally, the Company may retroactively adjust the premium rate accordingly back to the effective date of the change but not for any period before the most recent renewal. Medicare Carve-Out premiums are only available for Covered Individuals for whom Medicare is primary. 5
K. Eligibility Retroactive changes to the eligibility status of Covered Individuals cannot be effective more than three (3) months prior to the month in which the request is received by the Company. L. Misstatement of Age If the premium charges for coverage vary by the age of the Covered Individual, a fair adjustment of premiums shall be made if the age of the Covered Individual has been misstated. The Company will only be liable to adjust premiums retroactive to the last annual renewal date of this Agreement/Policy. M. Employee Eligibility An Employee is eligible for insurance if: Employee has completed Employer's waiting period; Employee is Actively at Work and working the number of hours required by Employer for insurance eligibility; and Employee is in a Covered Class, as determined by Employer. III. COMPANY PROVISIONS A. Premiums Premiums for this Agreement/Policy are based on Company rates. Rates are adjusted to reflect Company underwriting risk. Premiums may also be calculated by other methods. The Company and the Policyholder will agree on the method. The Company may change the premiums for the entire Group: On any Agreement/Policy renewal, with thirty-one (31) days written notice to Group or Group s designated consultant/agent if requested in writing by Group. (sixty (60) days prior written notice will be given for a premium increase greater than thirty-five (35) percent of the annual premium currently charged) On any Premium due date if the Company tells the Policyholder of the change at least thirty-one (31) days before the due date. When the terms of this Agreement/Policy change. A change in the terms of the Agreement/Policy is to include the addition or deletion of any enrollee(s) who materially affect(s) the Group's underwriting risk. In this case, rates may change for the entire Group on the effective date of such a change. B. Evidence of Insurability Evidence of Insurability or Evidence of Good Health is satisfactory proof, as determined by Us, that a person is acceptable for insurance. Evidence of Insurability is required: If Employee does not meet all of the requirements for insurance to become effective within thirty-one (31) days after becoming eligible for insurance; If Employee requests insurance after coverage ended because Employee did not pay any applicable premium contribution; If Employee did not meet a previous requirement for Evidence of Insurability to become insured under any insurance Agreement/Policy covering Employees of the Employer; or If Employee fails to enroll within thirty-one (31) days of becoming newly eligible. A person submitting the Evidence of Insurability will not be denied based on health status. However, the terms of this Agreement/Policy are subject to change as stated in Section III.A above. C. Amendments and Alteration of Contract This Agreement/Policy may be amended as follows: Only a President, Vice President, Secretary or other authorized representative of the Company can execute or amend this Agreement/Policy. No other person has the authority to bind the Company in any manner. An amendment will change the Agreement/Policy. The Policyholder will approve amendments; the Company will sign them. The consent of any Covered Individual is not required. The Company may amend this Agreement/Policy to conform with new or changed laws. We may amend it due to new medical discoveries or procedures. We will notify the Policyholder of the change, in writing, at least thirty-one (31) days before the change is effective. If the Policyholder pays the premium after the change is effective, that means they accept the change. D. Non-Renewal and Termination of Agreement/Policy The Policyholder may cancel this Agreement/Policy for any reason if it gives thirty-one (31) days written notice to Company. The Company shall renew or continue in force Group s coverage at the option of the Employer except: 6
1. In the event the Company ceases to offer a particular type of group health insurance in the group market, the Company will provide notice to the Covered Individual and Employer of its decision to discontinue such type in such market. Coverage under this Agreement/Policy will terminate no earlier than ninety (90) days after this notice is provided. If a type of coverage is discontinued, the Employer may select any other insurance currently offered by the Company to a group in such market at the rates applicable to the newly chosen coverage. 2. In the event the Company ceases to write all group health insurance in the group market in Virginia, the Company will provide notice of its decision to cease writing such business to the State Corporation Commission and to the Covered Individual and Employer. Coverage under this Agreement/Policy will terminate no earlier than one hundred eighty (180) days after this notice provided to the applicable market. 3. In the event that any renewal premium is not received by the Company within the thirty-one (31) day grace period following the premium due date, then coverage may be terminated after the thirty-first (31st) day. On the date this Agreement/Policy ends, the Agreement/Policyholder must pay the Company all premiums due. This includes premiums due for all or any part of the Grace Period while the Agreement/Policy was in force. The Company shall not be responsible to provide coverage, other than during the Grace Period described in this section for Group s nonpayment of premiums, when Group has failed to remit premiums to the Company that were received from Covered Individuals. 4. In the event of fraud or misrepresentation by the Group in the application or enrollment process for coverage under this Agreement/Policy, the Company may void coverage back to the Issue Date upon written notice. Unless it is determined that any or all of the Group s Covered Individuals are involved in the fraud or misrepresentation, the Group s Covered Individuals may apply for conversion or continuation as described in Section III.F. 5. In the event Policyholder fails to comply with the provisions defined in Section III.E below, except as described in Section III.E.6 below, the Company may non-renew or terminate this Agreement/Policy by giving the Group thirty-one (31) days advance written notice. E. Group Responsibilities The Company may end this Agreement/Policy as described in Section III.D above if Policyholder does not comply with the provisions defined below. Policyholder agrees to the following: 1. Unless previously approved by the Company, maintain enrollment at or above the minimum required. For groups with 2-50 total Eligible Employees, participation requirement: enrollment shall be maintained at the greater of the following: 1) seventy-five (75) percent of all Eligible Employees, less valid waivers, and 50% of total eligible employees or 2) two (2) Eligible Employees is required, whichever is greater. For the purpose of determining participation levels, the aggregate of all employees under Employer that are enrolled or eligible are included. If the Group is offered coverage from the Company and an Affiliated Company, the participation requirements apply in aggregate to both the Company and the Affiliated Company s coverage. 2. Maintain enrollment of at least two (2) Eligible Employees in a PPO benefit plan, unless the Group is offered coverage from an Affiliated Company. In those cases, the Group must maintain enrollment of at least two (2) Employees in the combined benefit plans offered the Group by the Company and its Affiliated Companies. 3. Permit any Eligible Employee to enroll in the applicable plan. 4. Acknowledge and agree to the terms and conditions of coverage as described in this Group Agreement/Policy, the Group Application, and the Certificate of Insurance. 5. Gather and retain supporting documentation on Qualifying Events. If an Eligible Employee seeks to enroll himself or herself and/or an Eligible Dependent other than at initial eligibility or during the Open Enrollment period, he or she must provide proof of the Qualifying Event (i.e., marriage or birth certificate, proof of loss of other health care coverage, or qualified medical child support order.) Policyholder must include this documentation when submitting Enrollment/Change forms to the Company for processing. 6. Furnish to Southern Health or the Company upon request such information as may reasonably be required by Southern Health or Company for the administration of Company's program and coverage provided hereunder. In addition, Southern Health or Company may at reasonable times examine Policyholder's pertinent records with respect to eligibility and premium payments hereunder. 7. Deliver the Company's Certificate of Insurance and notices to Covered Individuals within a reasonable period not to exceed thirty-one (31) days from receipt unless otherwise arranged with the Company. Policyholder s non-compliance 7
8. Make available to newly Eligible Employees information concerning the Company and the Company s application forms sufficient to permit such eligible persons to exercise the option of enrolling. 9. Permit representatives of the Company to conduct annual re-enrollment activities under conditions no less favorable than those granted to other health benefits plans offered by Policyholder. Offer coverage under this Agreement/Policy to Employees on terms no less favorable than those applicable to such other health coverage as may be available through the Policyholder. 10. Comply with the legal obligations imposed upon the Policyholder pertaining to the continuation of group health benefits for Employees and other Covered Individuals. The Group shall be responsible for notifying Covered Individuals of the availability, terms, and conditions of coverage under COBRA. In the event that the Group fails to notify Southern Health of a Covered Individual's election of COBRA coverage within the minimum election period allowed by law, Company will not continue the Covered Individual's coverage under this Agreement/Policy. To the extent Group allows or is deemed to have allowed a longer election period than the minimum period required by law, Group shall be responsible for all health care expenses incurred after the termination date if a Covered Individual elects COBRA continuation coverage after the minimum election period required by law. 11. Group shall remit to the Company all premiums for persons who continue group coverage in monthly installments with the Policyholder's regular monthly payment. If Policyholder requires Covered Individuals who elect to continue group coverage to pay all or any part of the premium for continued coverage, Policyholder shall be solely responsible for collecting the premium from the Covered Individual. Policyholder agrees that continued group coverage shall be provided only for persons eligible for such coverage under applicable law and regulations and for whom applicable premiums have been received by the Company. This provision applies to both continuation provisions listed in Section 8 of the Certificate of Insurance. 12. Maintain the Employer contribution rate at or above fifty percent (50%) of the premium for Employee only coverage of the lowest option offered by the Company or an Affiliated Company. F. Conversion or Continuation on Termination of Eligibility The Policyholder has been offered a choice of the conversion option or continuation option for Covered Individuals whose coverage is terminating. The Policyholder has made an option selection as denoted in the Group Application. Both options are fully explained in the Employee Certificate of Insurance issued to each Covered Individual under this Plan. It is the responsibility of the Policyholder to inform the Covered Individual of the option selected. G. Determination of Medical Necessity; Covered Benefits Except in cases prohibited by applicable law, the Company shall have sole authority to make all determinations that are required for the administration of the Certificate of Insurance including determinations regarding Medical Necessity and covered benefits to make factual findings and to construe and interpret the Certificate of Insurance, whenever necessary, to carry out its intent and purpose and to facilitate its administration. All such determinations, constructions, and interpretations made by the Company and in accordance with applicable law shall be binding upon the Covered Individual. H. Benefit Changes At least thirty-one (31) days prior Policyholder's renewal, the Company will provide notice of any changes to the benefit plan. I. Non-Waiver of Agreement/Policy Provisions If at any time the Company fails or delays enforcement or exercise of any of the provisions, rights, or remedies of this Agreement/Policy, this shall not be construed to be a waiver thereof. Nor will it in any way affect the validity of this Agreement/Policy. Nor will it affect the right of the Company to thereafter enforce each such provision, right, or remedy. No waiver of any breach of this Agreement/Policy is held to be a waiver of any other or subsequent breach. J. Relationship Between Parties Affected by the Group Insurance Agreement/Policy The relationship between the Company and any Provider is "independent contractor." No Provider is an agent or employee of the Company. The Company or any employee of the Company is not an employee or agent of any Provider. Each Provider has a Provider-patient relationship with Covered Individuals under this Agreement/Policy. Providers are solely responsible to Covered Individuals for supplies and services given. The Company s decisions are simply Preauthorizations for payment of Covered Services; therefore, We are not liable for the treatment decisions made by treating Providers. 8
Neither the Policyholder nor any Covered Individual under this Agreement/Policy is the agent or representative of the Company. Neither the Policyholder nor any Covered Individual under this Agreement/Policy is liable for any acts or omissions of the Company, its agents or employees. They also are not liable for acts or omissions of any health care Provider with which the Company, its agents or employees contract to give supplies and services to Covered Individuals. K. Conformity With Law If this Agreement/Policy does not conform to the requirements of any state or federal law that applies, this Agreement/Policy is automatically changed to satisfy the minimum requirements of that law. L. Employee Identification (ID) Cards The Company delivers ID cards to each insured Employee. When an Employee's insurance ends, the Policyholder must notify the Company through an Enrollment/Change Form. The Policyholder is responsible for Employee health claims if it does not promptly tell the Company an Employee's coverage has ended. IV. RECORDS The Policyholder will always maintain a record showing: The names of all Employees insured. The date on which each Employee became insured. The effective date of any increase or decrease in the amount of each Employee's insurance. The location where Eligible Employees report to work. Other information required to administer this insurance. The Policyholder will give the Company a copy of such record as of the Agreement/Policy Issue Date. The Policyholder will report to the Company all record changes as soon as possible, but not later than thirty (30) days after the change. V. GENERAL PROVISIONS A. Incontestability The validity of the Group Agreement/Policy shall not be contested except for non-payment of premiums after it has been in force for two (2) years from the Issue Date. No statement except fraudulent misstatements made to qualify for insurance for Covered Individuals shall be used in contesting the validity of the coverage of the person about whom the statement was made after coverage has been in force for a period of two (2) years during the lifetime of the person about whom the statement was made. B. Physical Exams and Autopsy The Company through Southern Health shall have the right: to examine the Covered Individual for whom a claim is made when and as often as it may reasonably require during the pendency of a claim under the Group Agreement/Policy; and to perform or cause to perform an autopsy where it is not prohibited by law. C. Legal Actions No action at law or suit in equity may be brought against the Company: within the sixty (60)-day period after written proof of loss is filed; or more than three (3) years after the date on which written proof of loss was required to be filed under Section 9 of the Employee Certificate of Insurance; with respect to any matter relating to: this Group Agreement/Policy; the Company's performance under this Group Agreement/Policy; or any statement made by employees, officers, or directors of the Company concerning the Group Agreement/Policy or the benefits available to a Covered Individual. D. Claim Provisions The Company and the Policyholder agree to the claim provisions concerning the notification and filing of proof of loss and the payment of claims as specified in Section 9 of the Employee Certificate of Insurance. E. Claims Experience For Policyholders that employ an average of at least 100 individuals who were insureds, subscribers, or enrollees on business days during the preceding 12-month period, the Company will provide Policyholder, upon request, the following at no cost to Policyholder. 9
1. A complete record of Policyholder s medical claims experience or medical costs incurred under the this Agreement/Policy. The record shall include all claims incurred for the lesser of (i) the period of time since this Agreement/Policy was issued or issued for delivery or (ii) the period of time since this Agreement/Policy was last renewed, reissued or extended, if already issued. The record shall be made available promptly to Policyholder upon request made not less than 30 days prior to the date upon which the premiums or contractual terms of this Agreement/Policy may be amended. 2. At the time it provides the information listed in #1 above provide (i) a summary of medical claims charges or medical costs incurred and the amount paid with respect to those claims for the most recently available 24-month period; (ii) a listing of the number of insured, subscribers or enrollees for whom combined medical claims payments or medical costs exceed $100,000 (or for amounts less than $100,000 if Policyholder and the Company agree) for the most recently available 12-month period, and for the preceding 12 months if not previously provided, with information as to whether these enrollees from the most recently available 12-month period remain enrolled under this Agreement/Policy; and (iii) total enrollment in each membership type as of the end of the most recently available 12-month period. This record shall be made available to Policyholder within 20 business days upon written request made not less than 45 days prior to the date upon which the premiums or contractual terms of this Agreement/Policy may be amended. F. Covered Individuals Entitled to Medicaid Benefits If a Covered Individual is also entitled to benefits under a state Medicaid program: 1. Payments for Covered Services rendered to the Covered Individual will be made in accordance with any assignment of rights made by or on behalf of such Covered Individual as required by Medicaid. 2. To the extent that payment has been made under Medicaid for Covered Services, payment of benefits under this Agreement/Policy will be made in accordance with any state law which provides that the state has acquired the rights with respect to a Covered Individual for payment for such services. The Policyholder shall not take into account whether an individual is entitled to Medicaid when determining whether the individual is an Eligible Employee or Eligible Dependent. G. Covered Services and Individual Case Management In addition to the Covered Services described in this Agreement/Policy, the Company may elect to offer or extend benefits for a Preauthorized alternate treatment plan for a patient who would otherwise require more expensive Covered Services. This includes, but is not limited to long term inpatient care. The Company shall provide such alternate benefits at it sole option. It shall do so only when and for so long as it decides that the services are Medically Necessary and cost effective. The total benefits paid for such services may not exceed the total which would otherwise be paid under this Agreement/Policy without alternate benefits. If the Company elects to provide alternate benefits for a Covered Individual in one instance, it shall not be required to provide the same or similar benefits for any Covered Individual in any other instance. Also, this shall not be construed as a waiver of the Company's right to enforce this Agreement/Policy in the future in strict accordance with its express terms. This process is called case management. H. Payment of Benefits All or any portion of any benefits provided for Covered Services may be paid by the Company to the health care Provider. In the event of a Covered Individual s loss of life, any portion of benefits for Covered Services that is not paid to the health care Provider shall be payable to the surviving spouse. If there is no surviving spouse, benefits for Covered Services will be paid to the eldest Eligible Dependent. In the event no such family member is living at time of the Covered Individual s death, the benefit is payable to the estate of the Covered Individual deceased. If any benefit is payable to the estate of a person or to a person who is a minor or otherwise not competent to give a valid release, the Company may pay the benefit up to an amount not exceeding $5,000 to any relative by blood or connection by marriage of the person who is deemed by the Company to be equitably entitled to the benefit. I. Assignment Neither Policyholder nor any Covered Individual shall assign the Agreement/Policy or any benefits under the Agreement/Policy, except as allowed in Section V.G above, to any person, corporation, or other organization. Any such assignment will be void. The Company shall have the absolute right, in its sole discretion, to assign or license all or any of its rights and responsibilities and delegate all or any of its obligations under the Agreement/Policy: (1) to any corporation or other entity that controls, is controlled by, or is under common control with the Company or: (2) to any successor to the business of the Company whether by merger, consolidation, sale of assets, operation of law, or otherwise. 10
VI. DISCLOSURE OF PROTECTED HEALTH INFORMATION (PHI) Policyholder and the Company acknowledge their obligations to protect the privacy and security of certain information of Covered Individuals. From time to time, Policyholder may need to request certain information that may contain Protected Health Information (as defined under the HIPAA Privacy and Security Rules) regarding its employees or their dependents. Such information may be provided by the Company to the extent it is permissible under HIPAA and state law. In order for the Company to provide such information to Policyholder, Policyholder, as the plan sponsor of its group health plan, hereby represents and warrants that: 1. Any employee who on behalf of Policyholder requests PHI from Coventry shall be acting in an administrative capacity for the group health plan and not for the Policyholder. 2. Policyholder shall not use the PHI in employment-related decisions. 3. Policyholder has provided a certification to its group health plan and has amended its plan documents in accordance with Sections 45 CFR 164.504(f) and 164.314(b) of HIPAA. The Policyholder s plan documents have been amended to comply with HIPAA, including, but not limited to, the requirements to: Describe the Policyholder s uses and disclosures of PHI. Describe the individuals or classes of employees who are involved in plan administration and have access to PHI. Not use or further disclose PHI other than as permitted or required by the plan documents or as required by law. Not use or disclose PHI in connection with any other benefit or employee related plan of plan sponsor. Ensure that the adequate separation between the group health plan and the plan sponsor established as required by HIPAA (45 CFR 164.504(f)(2)(iii)). Implement administrative, physical, and technical safeguards that reasonably and appropriately protect the confidentiality, integrity, and availability of PHI that it creates, receives, maintains, or transmits on behalf of the group health plan. 11