Section 1300.65.2 - Cancellations or Nonrenewals for Nonpayment of Premiums (California Code of Regulations)

§ 1300.65.2. Cancellations or Nonrenewals for Nonpayment of Premiums

(a) General Requirements

(1) Applicability. This section shall apply to all cancellations and nonrenewals for nonpayment of premiums pursuant to Health and Safety Code section 1365(a)(1)(A), unless an enrollee, subscriber, or group contract holder is entitled to a longer grace period pursuant to state or federal law.

(2) Grace Period

(A) The grace period may not begin sooner than the day after the last date of paid coverage. Grace period is defined in California Code of Regulations, title 28, section 1300.65(a)(9).

(B) A plan shall provide coverage pursuant to the terms of the contract during the entire grace period. The term "Grace Period" does not include the "Federal Grace Period," as defined in California Code of Regulations, title 28, section 1300.65(a)(8), which applies to individuals receiving APTC pursuant to the PPACA, section 1401 (26 U.S.C. § 36B).

(3) Notices

(A) Upon determining that an enrollee, subscriber, or group contract holder has failed to make a premium payment by the due date, the plan shall send a Notice of Start of Grace Period to the enrollee, subscriber, or group contract holder, notifying the recipient that a payment delinquency has triggered a grace period starting from the day the Notice of Start of Grace Period is dated. This Notice shall, at minimum, contain the information set forth in California Code of Regulations, title 28, section 1300.65.2(b)(1).

(B) The plan shall send a Notice of Start of Grace Period to each subscriber in a group contract unless:

(i) The plan contract requires the group contract holder to promptly send any such Notice to each subscriber; and

(ii) The plan sends the Notice to the group contract holder designated in the plan contract.

(C) A plan shall not delegate the responsibility for sending the Notice of Start of Grace Period to a group contract holder for each subscriber in the group unless the plan has complied with California Code of Regulations, title 28, section 1300.65.2(a)(3)(B).

(D) In the case where a plan has delegated the responsibility for sending the Notice of Start of Grace Period to a group contract holder, the Notice of Start of Grace Period to the group contract holder triggers the 30-day grace period. Any subsequent notice to the subscribers in the group does not restart the 30-day grace period.

(E) For the purposes of this section, all plans shall notify an enrollee, subscriber, or group contract holder when the plan has cancelled, rescinded, or not renewed health coverage in one of the following two ways:

(i) Send a written notice of termination to the enrollee, subscriber, or group contract holder, when required pursuant to California Code of Regulations, title 10, section 6506(e)(1). This notice shall include the notice of grievance rights set forth in California Code of Regulations, title 28, section 1300.65.5, and any notice required under Health and Safety Code section 1366.50; or

(ii) Send the Notice of End of Coverage. This Notice shall be sent after the date coverage ends, and no later than five calendar days after the date coverage ended. At a minimum, this Notice shall contain the information set forth in California Code of Regulations, title 28, section 1300.65.2(b)(2).

(4) Notwithstanding California Code of Regulations, title 28, section 1300.65(a)(14), a plan may implement a premium payment threshold policy, as defined in California Code of Regulations, title 28, section 1300.65(a)(21).

(5) In the event the plan, after compliance with all timing and notice requirements of this section, fails to receive all outstanding premium amounts from the enrollee, subscriber, or group contract holder on or before the last day of the grace period, as specified in the Notice of Start of Grace Period, coverage may be cancelled prospectively only after the expiration of the entire grace period.

(6) The plan shall continue the enrollee, subscriber, and/or group contract holder's coverage uninterrupted pursuant to the plan contract upon payment of all outstanding premium amounts at any time before the expiration of the grace period.

(7) The enrollee, subscriber, or group contract holder is financially responsible for any and all premiums and any copayments, coinsurance, or deductible amounts obligated under the plan contract, including those incurred for services received during the grace period.

(b) Elements of Notices

(1) Notice of Start of Grace Period

The Notice of Start of Grace Period shall comply with all applicable federal and state requirements, and shall include all of the following:

(A) The title "Notice of Start of Grace Period" displayed in 20-point bolded font at the top of the first page of the notice;

(B) The name and contact information for the enrollee, subscriber, or group contract holder;

(C) For all contracts issued in the individual market, the names of all enrollees affected by the notice;

(D) The date of the notice, expressed as a month, day and year;

(E) A statement indicating the specific date the grace period begins;

(F) The dollar amount past due. This amount shall indicate the amounts owed by month if more than one month is past due;

(G) The date of the last day of paid coverage, expressed as a month, day and year;

(H) The name of the plan;

(I) An explanation of the grace period and the specific date the grace period expires, expressed as a month, day and year;

(J) The telephone number for the plan's customer service; and

(K) A statement explaining the consequence of losing coverage, including, financial responsibility for the payment of claims incurred and the obligations of the subscriber.

(2) Notice of End of Coverage

The Notice of End of Coverage shall comply with all applicable federal and state requirements, and shall include all of the following:

(A) The title "Notice of End of Coverage" displayed in 20-point bolded font at the top of the first page of the notice;

(B) The name and contact information for the enrollee, subscriber, or group contract holder;

(C) For all contracts issued in the individual market, the names of all enrollees affected by the notice;

(D) The date of the notice;

(E) The effective date of cancellation, expressed as a month, day and year;

(F) The reason for cancellation;

(G) The notice of grievance rights in accordance with Health and Safety Code section 1365(b) and California Code of Regulations, title 28, section 1300.65.5;

(H) Any notice required under Health and Safety Code section 1366.50; and

(I) The following statement: "To learn about new coverage or whether your coverage can be reinstated, contact [health plan] at [contact information]."

(1. New section filed 12-22-2014; operative 1-1-2015 pursuant to Government Code section 11343.4(b)(3) (Register 2014, No. 52). 2. Repealer and new section filed 7-30-2019; operative 10-1-2019 (Register 2019, No. 31).)

Note: Authority cited: Section 1344, Health and Safety Code. Reference: Sections 1365 and 1366.50, Health and Safety Code.

Disclaimer: All information on this page is frequently updated based on official sources. However, Lawrina cannot accept any responsibility for the accuracy of the content for Section 1300.65.2 Cancellations or Nonrenewals for Nonpayment of Premiums. To check for possible violations, please check the official sources.

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