GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1997

S	1 

SENATE BILL 610

Short Title:  Insurer Discrimination/Abused Persons. 	(Public)

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Sponsors: Senator Miller.

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Referred to:  Judiciary.

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April 1, 1997

A BILL TO BE ENTITLED
AN ACT TO SPECIFICALLY MAKE UNFAIR DISCRIMINATION AGAINST ABUSED PERSONS AN UNFAIR TRADE PRACTICE IN THE BUSINESS OF INSURANCE.
The General Assembly of North Carolina enacts:
Section 1.  Article 63 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58-63-17.  Unfair discrimination against subjects of abuse.
(a)	Definitions. – As used in this section:
(1)	'Abuse' means the occurrence of one or more of the following acts:
a.	Attempting to cause or intentionally, knowingly, or recklessly causing another person bodily injury, physical harm, severe emotional distress, psychological trauma, rape, sexual assault, or involuntary sexual intercourse.
b.	Knowingly engaging in a course of conduct or repeatedly committing acts toward another person, including following the person without proper authority, under circumstances that place the person or minor child in reasonable fear of bodily injury or physical harm.
c.	Subjecting another person to false imprisonment.
d.	Attempting to cause or intentionally, knowingly, or recklessly causing damage to property so as to intimidate or attempt to control the behavior of another person.
(2)	'Abuse-related medical condition' means a medical condition sustained by a subject of abuse that arises in whole or part out of an act or pattern of abuse.
(3)	'Abuse status' means the fact or perception that a person is, has been, or may be a subject of abuse, irrespective of whether the person has sustained abuse-related medical conditions.
(4)	'Carrier' means an insurer, MEWA (as defined in G.S. 58-49-30), service corporation, or health maintenance organization subject to this Chapter.
(5)	'Health benefit plan' or 'plan' means a policy, contract, certificate, or agreement offered by a carrier to provide, deliver, arrange for, pay for, or reimburse any of the costs of health care services.  'Health benefit plan' includes accident only, credit health, dental, vision, Medicare supplement, or long-term care insurance, coverage issued as a supplement to liability insurance, short-term and catastrophic health insurance policies, and a policy that pays on a cost-incurred basis.  'Health benefit plan' does not include workers' compensation or similar insurance.
(6)	'Health carrier' means a carrier that contracts or offers to contract to provide, deliver, arrange for, pay for, or reimburse any of the cost of health care services.
(7)	'Insured' means a party named on a policy as the person with legal rights to the benefits provided by the policy.  For group health benefit plans, 'insured' includes a person who is a beneficiary covered by a group health benefit plan.
(8)	'Subject of abuse' means a person to whom a family member, or a current or former household member, intimate partner, or caretaker, or a perpetrator of sexual assault, a stalker, or a sex offender has directed an act defined in subsection (a) of this section; who has current or prior injuries, illnesses, or disorders that resulted from abuse; or who seeks, may have sought, or had reason to seek medical or psychological treatment for abuse or protection, court-ordered protection, or shelter from abuse.
(b)	Unfair Discrimination Against Subjects of Abuse Prohibited. – A carrier shall not engage, directly or indirectly, in an unfairly discriminatory act or practice against a subject of abuse.
(c)	Unfairly Discriminatory Acts Relating to Insurance Policies. – The following acts are prohibited as unfairly discriminatory:
(1)	On the basis of an applicant's or insured's abuse status, denying, refusing to issue, renew, or reissue a policy; canceling or otherwise terminating a policy; restricting or excluding coverage; or unilaterally adding a premium differential to any policy.
(2)	On the basis of the insured's abuse status, excluding or limiting coverage for losses or denying a claim incurred by an insured as a result of abuse.
(3)	Terminating group health insurance coverage for a subject of abuse because coverage was originally issued in the name of the abuser and the abuser has divorced, separated from, or lost custody of the subject of abuse, or the abuser's coverage has terminated voluntarily or involuntarily.  Nothing in this subsection prohibits the health carrier from requiring the subject of abuse to pay the full premium for coverage under the health plan or from requiring as a condition of coverage that the subject of abuse reside or work within its service area, if the requirements are applied to all insureds of the health carrier.  The health carrier may terminate group coverage after the continuation coverage required by this subsection has been in force for 18 months, if it offers conversion to an equivalent individual plan.  The continuation coverage required by this section shall be satisfied by coverage required under P.L. 99-272, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), provided to a subject of abuse and is not intended to be in addition to coverage provided under COBRA.
(4)	Disclosure or transfer by a person employed by or contracting with a health carrier of any information relating to (i) a person's abuse status, (ii) a person's medical condition which the health carrier knows or has reason to know is abuse-related, or (iii) a person's family, household, social, or employment relationship with a subject of abuse; except to the extent necessary for the direct provision of health care services, compliance with abuse reporting laws, or compliance with an order of the Commissioner or a court of competent jurisdiction.  This subsection does not preclude a person who is the subject of abuse from obtaining that person's own medical records.  This subsection does not prohibit a health carrier from asking an applicant or insured about a medical condition, even if the condition is abuse-related, or from using information obtained from the applicant or insured for the purpose of acts or practices permitted by this section.  A subject of abuse may provide evidence of abuse to a health carrier for the limited purpose of facilitating treatment of an abuse-related condition or demonstrating that a medical condition is abuse-related; and this section does not authorize the health carrier to disregard that information.
(d)	A violation of this section is an unfair trade practice."
Section 2.  G.S. 58-63-25(a) reads as rewritten:
"(a)	When the Commissioner has reason to believe that any person has been engaged or is engaging in this State in any unfair method of competition or any unfair or deceptive act or practice defined in G.S. 58-63-15 or G.S. 58-63-17 or under G.S. 58-63-65, and that a proceeding by the Commissioner on the matter would be in the interest of the public, the Commissioner shall issue and serve upon the person a statement of the charges in that respect and a notice of the hearing on the matter to be held at the time and place fixed in the notice, which shall not be less than 10 days after the date of the service of the notice."
Section 3.  G.S. 58-63-35(a) reads as rewritten:
"(a)	Any person required by an order of the Commissioner under G.S. 58-63-32 to cease and desist from engaging in any unfair method of competition or any unfair or deceptive act or practice defined in G.S. 58-63-15 or G.S. 58-63-17 or under G.S. 58-63-65 may obtain a review of the order by filing in the Superior Court of Wake County, within 30 days from the date of the service of such order, a written petition praying that the order of the Commissioner be set aside. A copy of the petition shall be immediately served upon the Commissioner, and at that time the Commissioner immediately shall certify and file in the court a transcript of the entire record in the proceeding, including all the evidence taken and the report and order of the Commissioner. Upon the filing of the petition and transcript, the court has jurisdiction of the proceeding and of the question determined therein, shall determine whether the filing of the petition shall operate as a stay of the Commissioner's order, and has power to make and enter upon the pleadings, evidence, and proceedings set forth in the transcript a decree modifying, affirming or reversing the order of the Commissioner, in whole or in part. The findings of the Commissioner as to the facts, if supported by substantial evidence, are conclusive."
Section 4.  This act applies to all insurance policies and health benefit plans that are delivered, issued for delivery, or renewed on and after October 1, 1997.  For the purposes of this act, renewal of a health benefit plan is presumed to occur on each anniversary of the date on which coverage was first effective on the person or persons covered by the health benefit plan.
Section 5.  This act becomes effective October 1, 1997, and applies to all acts regarding insurance coverage occurring on or after that date.