Rescission prohibition

Applies to grandfathered and non-grandfathered group plans

Requirement overview

• For plans renewing 9/23/2010 and after, coverage can no longer be rescinded except in the case of fraud or intentional misrepresentation of material fact.
• Rescission is cancellation of coverage that has a retroactive effect. For example, if a plan voids a policy back to the policy's effective date.
• It is not considered a rescission if coverage is canceled or not renewed:
• Prospectively
• Retroactively due to failure to pay required premiums or contributions toward the cost of coverage
• Because a product or issuer has been removed from the market
• Because an individual or group has moved outside the service area
• Due to bona fide association coverage
• Ending of association membership
• Plans must provide at least 30-days' notice when rescinding coverage.

What Priority Health is doing

We have adopted this process to ensure you and the health plan comply:

• You must tell us the exact termination date within 30 days of the termination.
• When you submit a termination, you are acknowledging that you told the member they’re losing their coverage on the date they lose eligibility.
• If you do tell us about a termination more than 30 days after the termination date, you must certify that you told the affected employee about the loss of coverage when they lost eligibility.

What you need to do

It's very important that you notify us about coverage terminations in a timely manner. You will be liable for premium charges covering employees enrolled in the plan.