A health insurance issuer offering health insurance coverage in the small or large group market is required to renew or continue in force the coverage at the option of the plan sponsor (generally, the employer). This is known as guaranteed renewability.
Exceptions. An issuer may nonrenew or discontinue group health insurance coverage in the small or large group market based only on one or more of the following:
- nonpayment of premiums;
- fraud or misrepresentation;
- issuer’s termination of coverage in that market (see paragraph below);
- plan sponsor’s violation of participation or contribution requirements;
- enrollees’ movement outside the service area; or
- cessation of employer’s membership in a bona fide association through which coverage was made available.
Discontinuing a particular product. In cases where the insurer will no longer offer a particular coverage in a market or state, the insurer must give at least 90 days notice and make available alternative coverage without regard to experience or health status. If the insurer is exiting altogether from the insurance market in a market or state, the insurer must give 180 days notice prior to termination and cannot sell insurance in that market or state for five years.
Cite: HHS Reg. §146.152.