South Carolina Code 38-71-1440. Requirements upon small employer insurers
(B)(1) Except as provided in item (2), no small employer insurer or its agent shall, directly or indirectly, engage in the following activities:
Terms Used In South Carolina Code 38-71-1440
- Contract: A legal written agreement that becomes binding when signed.
- insurance: includes annuities. See South Carolina Code 38-1-20
- Insurer: means an entity that provides health insurance in this State. See South Carolina Code 38-71-1330
- plan: means any hospital or medical policy or certificate, major medical expense insurance, hospital or medical service plan contract, or health maintenance organization subscriber contract that provides benefits consisting of medical care provided directly through insurance or reimbursement, or otherwise and including items and services paid for medical care. See South Carolina Code 38-71-1330
- Plan of operation: means the plan of operation of the program established pursuant to § 38-71-1410. See South Carolina Code 38-71-1330
- Premium: means payment given in consideration of a contract of insurance. See South Carolina Code 38-1-20
- Program: means the South Carolina Small Employer Insurer Reinsurance Program pursuant to § 38-71-1410. See South Carolina Code 38-71-1330
- Small employer: means , in connection with a health insurance plan with respect to a calendar year and a plan year, any person, firm, corporation, partnership, association, or employer, as defined in Section 3(5) of the Employee Retirement Income Security Act of 1974, that is actively engaged in business that, on at least fifty percent of its working days during the preceding calendar year, employed no more than fifty eligible employees or employed an average of not more than fifty employees on business days during the preceding calendar year and who employs at least one employee on the first day of the plan year. See South Carolina Code 38-71-1330
- Small employer insurer: means an insurer that offers health insurance plans covering eligible employees of one or more small employers in this State. See South Carolina Code 38-71-1330
- Standard health insurance plan: means a health insurance plan developed pursuant to § 38-71-1420. See South Carolina Code 38-71-1330
- Terminate: means the cancellation of the relationship between an insurance producer and the insurer or the termination of a producer's authority to transact insurance. See South Carolina Code 38-1-20
(a) encouraging or directing small employers to refrain from filing an application for coverage with the small employer insurer because of the health status, claims experience, industry, occupation, or geographic location of the small employer;
(b) encouraging or directing small employers to seek coverage from another insurer because of the health status, claims experience, industry, occupation, or geographic location of the small employer.
(2) The provisions of item (1) shall not apply with respect to information provided by a small employer insurer or agent to a small employer regarding the established geographic service area or a restricted network provision of a small employer insurer or health maintenance organization.
(C)(1) Except as provided in item (2), no small employer insurer shall, directly or indirectly, enter into any contract, agreement, or arrangement with an agent that provides for or results in the compensation paid to an agent for the sale of a health insurance plan to be varied because of the health status, claims experience, industry, occupation, or geographic location of the small employer.
(2) Item (1) shall not apply with respect to a compensation arrangement that provides compensation to an agent on the basis of percentage of premium, provided that the percentage shall not vary because of the health status, claims experience, industry, occupation, or geographic area of the small employer.
(D) A small employer insurer shall provide reasonable compensation, if provided under the plan of operation of the program, to an agent, if any, for the sale of a basic or standard health insurance plan.
(E) No small employer insurer may terminate, fail to renew, or limit its contract or agreement of representation with an agent for any reason related to the health status, claims experience, occupation, or geographic location of the small employers placed by the agent with the small employer insurer.
(F) No small employer insurer or agent may induce or otherwise encourage a small employer to separate or otherwise exclude an employee from health coverage or benefits provided in connection with the employee’s employment.
(G) Denial by a small employer insurer of an application for coverage from a small employer shall be in writing and shall state the reason or reasons for the denial.
(H) If a small employer insurer enters into a contract, agreement, or other arrangement with a third-party administrator to provide administrative, marketing, or other services related to the offering of health insurance plans to small employers in this State, the third-party administrator shall be subject to this article as if it were a small employer insurer.