Life and Health News
September 2025
Welcome to our latest newsletter! As a thought leader in the Insurance Industry for over 50 years we are always excited to share the latest sampling of insurance compliance related bulletins, regulations, and legislative activity. Please feel free to share this newsletter with others that may be interested. Contact Us with any questions on the items in this newsletter or with any other compliance related matter we can assist you with. Enjoy!
ADVERTISING / SALES & MARKETING
New Mexico updated its rules on value-added products and services offered by insurers, allowing such offerings at no or reduced cost if they meet criteria like relevance to coverage, reasonableness, non-discrimination, and documented evidence. Insurers must notify the DOI via a SERFF filing with a $15 fee before offering these products. The bulletin clarifies that these exceptions apply only to insurers - not producers - and outlines procedures for rider issuance and dispute resolution. Bulletin 2025-006
AFFORDABLE CARE ACT
United States Department of Health and Human Services (HHS) issued the Marketplace Integrity and Affordability Final Rule on June 25, 2025, aimed at improving ACA Exchange affordability and integrity, with an effective date of August 25, 2025. However, key insurance-related provisions - including premium penalties for late eligibility updates, issuer coverage denials for unpaid premiums, special enrollment verification, and income verification processes - have been stayed by a federal court pending litigation. These stays delay enforcement of several regulatory changes impacting Exchange enrollees, issuers, and eligibility verification. CMS Notice Dated 8/25/25
United States health plans must use a good faith interpretation of the 2023 Qualified Payment Amount (QPA) calculation pending a final court decision, while continuing required QPA disclosures. FAQs were issued regarding implementation of the No Surprises Act and Affordable Care Act under the Consolidated Appropriations Act, 2021, Part 71. For the 2026 plan year, the premium adjustment percentage is 1.6727, with maximum out-of-pocket limits of $10,600 for self-only and $21,200 for other coverage. CMS Notice Dated 7/30/25
CREDIT INSURANCE
Arizona issued an order effective February 1, 2026, updating prima facie credit life insurance rates and capping monthly rates at $0.84 per $1,000 for single life and $1.39 for joint lives. Order Dated 7/31/25 - Docket No. 25A-005-INS
South Carolina issued a bulletin proposing a 15% reduction in credit accident and health insurance rates for 2026 to meet a minimum 50% loss ratio, reflecting historically low loss ratios from 2021-2024. The bulletin sets single premium rates per $100 of initial indebtedness for various coverage terms and requires non-single premium rates to be actuarially equivalent. Bulletin 2025-06
CYBERSECURITY
Colorado amended its regulations to set governance and risk management standards for insurers using external consumer data, algorithms, and predictive models in individual life, private passenger auto, and health insurance. The regulation aims to prevent unfair discrimination, requires detailed oversight frameworks, and mandates compliance reporting via SERFF, with operative deadlines starting December 1, 2024, for life insurers and July 1, 2026, for auto and health insurers. 3 CCR 702 Reg. 10-1-1 s 1 +
North Dakota updated its data security rules, requiring all licensed entities to implement a tailored Information Security Program and report cybersecurity events impacting 250 or more consumers within three business days. These changes include prompt investigations and five-year record retention. Bulletin 2025-1
DENTAL INSURANCE
Illinois now allows insured individuals under dental insurance policies, in addition to accident and health insurance policies, to assign their rights and privileges under the policy, including claims to dental care providers or facilities. Payment for assigned claims must be made directly to the dental care provider or facility, and interest requirements for delayed payments apply. SB 1392
Illinois updated the Uniform Electronic Transactions in Dental Care Billing Act to standardize electronic billing and reimbursement processes for dental plan carriers and providers, introduce a HIPAA-compliant eligibility and benefit verification portal, extend the deadline for mandatory electronic claims and eligibility transactions to 2027, and allow exemptions for certain dental providers. HB 1864
DEPENDENT COVERAGE
Illinois amended its Insurance Code to exclude student health insurance from the requirement that group or individual accident and health policies offering dependent coverage must also cover the insured’s parent or stepparent if specific conditions are met. HB 1577
DISASTER / CATASTROPHIC EVENT
North Carolina instructs health benefit plans to allow insured individuals affected by Hurricane Erin to obtain extra prescription medications during the declared state of emergency, applying to health plans and stand-alone prescription drug plans. Bulletin 25-B-10
DISCRIMINATION
Illinois amended rules for final expense life insurance to prohibit denying coverage, limiting benefits, or charging different rates solely based on a felony conviction, while allowing insurers to exclude those actively incarcerated. The amendment also provides a clear definition of "final expense policy." HB 2425
FILING REQUIREMENTS / PROCEDURES
Alabama issued a bulletin mandating the exclusive use of SERFF for all rate and form filings and requiring electronic funds transfer (EFT) for fee payments. The bulletin consolidates and replaces multiple earlier directives and establishes detailed filing fees across various insurance lines, with a maximum fee of $5,000 per SERFF submission. Bulletin 2025-04
HEALTH INSURANCE - COMPREHENSIVE
Illinois amended health insurance rules to protect insured individuals from higher out-of-pocket costs for neonatal intensive care received from nonparticipating providers or facilities. The amendment requires insurers to ensure these costs do not exceed what would be charged by participating providers when billed as emergency services. HB 2464
Illinois requires all group and individual health insurance policies and managed care plans issued or renewed after January 1, 2027, to cover medically necessary laser hair removal when prescribed according to accepted medical standards. This mandate applies broadly across state and local government health plans but excludes Medicaid recipients. HB 3248
Illinois revised its regulations to impose a $5,000 monthly fine on insurers that fail to update provider directories on time. Providers must report changes within 10 business days, and insurers must update directories within 2 business days. Self-audits of directories are required every 90 days, with reports submitted to the Department and made public. Printed directories must be updated quarterly and include contact details, accuracy disclosures, and instructions for reporting errors or disputing charges. HB 3800; 215 ILCS 124/25
New Mexico provided updated guidance for issuers of major medical plans, requiring the use of standardized prior authorization language in Evidence of Coverage documents and continued filing of the unchanged Administrative Data template for Qualified Health Plans in SERFF. The bulletin also introduces standardized discontinuation and auto-renewal notice forms to help issuers manage plan discontinuations and assist enrollees in transitioning to new plans. Bulletin 2025-007
New Mexico updated its Prior Authorization Act, removing prior authorization and step therapy requirements for FDA-approved off-label drugs used to treat rare diseases, autoimmune disorders, cancer, and substance use disorders, unless biosimilars or generics are available. Health insurers must ensure medical necessity reviews are done by specialists within set timeframes, with automatic approval if deadlines are missed, and submit compliance evidence to the OSI. The changes apply to fully insured health plans issued after July 1, 2025. Bulletin 2025-005
Oregon now prohibits billing enrollees beyond in-network cost-sharing for covered ground ambulance services and requires insurers to reimburse providers at local rates or at least 325% of Medicare rates. Providers must annually report rates to the Department of Consumer and Business Services. The law also allows certain self-funded plans and public employee benefit boards to opt in, with penalties for repeated violations. HB 3243
Texas extended payment standards and balance billing prohibitions for emergency medical services through September 1, 2027. Instead of mandatory payment adjustments, political subdivisions may annually report rate data, which sets the payment standards. The DOI reopened its data portal for 2025 rate submissions due by September 1, 2025, with prior 2024 data remaining effective if no new rates are submitted. Bulletin B-0011-25
LIMITED BENEFIT CONTRACTS
United States Departments of Labor, Health and Human Service, and Treasury (Tri Agencies) issued final rules titled "Short Term, Limited Duration Insurance and Independent, Noncoordinated Excepted Benefits Coverage." The Tri-Agencies have since announced they do not intend to prioritize enforcement actions for violations related to failing to meet the definition of "short-term, limited duration insurance" in the 2024 final rules, including the notice provision. States are encouraged to adopt a similar approach to enforcement. CMS Notice Dated 8/7/25
MEDICARE SUPPLEMENT INSURANCE
Rhode Island notified Medigap insurers about CMS’s designation of UnitedHealthcare’s termination of its contract with Brown University Health as a significant network change, triggering a Special Election Period (SEP) for affected Medicare Advantage enrollees. This SEP allows impacted members to disenroll and return to Original Medicare, with Medigap guaranteed issue rights enabling eligible individuals to purchase specific Medigap plans under federal rules. Advisory 2025-1
MENTAL HEALTH PARITY
Connecticut updated its annual reporting requirements for mental health and substance use disorder (MH/SUD) parity compliance, replacing Bulletin MC-24-A. Effective March 1, 2026, carriers must submit detailed reports analyzing the application of non-quantitative treatment limitations (NQTLs) to ensure parity with medical/surgical benefits. Incomplete or late filings may result in penalties. Bulletin MC-24B
MISCELLANEOUS
California issued a bulletin outlining year-end review procedures for corporate applications requiring Department of Insurance approval by the end of 2025. The notice sets deadlines - September 15 for general filings and October 13 for Holding Company Act applications - and requires perfected submissions with all documentation and justification for urgency. Notice Dated 8/15/25
Federal Exemptive Relief Order delays the effective date of the Investment Adviser Rule (Investment Adviser Anti-Money Laundering/Countering the Financing of Terrorism Program and Suspicious Activity Report Filing Requirements for Registered Investment Advisers). The rule was set to become effective on January 1, 2026, but a new effective date of January 1, 2028, is being proposed. FinCEN Order dated August 5, 2025
Illinois updated its small estate affidavit rules, raising the estate value limit for transferring personal property (excluding motor vehicles) to $150,000. The changes also clarify procedures for transferring motor vehicles and require detailed vehicle information on the affidavit. These provisions apply to estates of decedents who pass away on or after the effective date. SB 83
Illinois now requires coverage for emergency and urgent ground ambulance services from nonparticipating providers starting January 1, 2027. Insurers must ensure beneficiaries pay no more out-of-pocket than they would with participating providers, pay nonparticipating providers directly, and prevent balance billing beyond standard cost-sharing. Additionally, nonparticipating providers must annually report charge rates to the Department of Public Health. HB 2785
PHARMACY BENEFIT MANAGERS
Oregon updated rules for Pharmacy Benefit Managers (PBMs) and Drug Price Transparency reporting. Key changes include requiring PBMs to be licensed (not just registered), report detailed aggregated data on rebates, fees, and pricing annually, and comply with new operational standards that protect pharmacies from certain fees and restrictive practices. Insurers must also report prescription drug cost data annually without minimum enrollee thresholds. OAR 836-053-1630
Pennsylvania addressed pharmacy network adequacy following Rite Aid’s bankruptcy and closures. Insurers must notify the Department if closures impact network standards and provide alternative access plans, including out-of-network options with in-network cost-sharing. The notice requires proactive patient communication, smooth prescription transfers, expedited prior authorizations, and flexible pharmacy audits to ensure uninterrupted medication access. Notice 2025-07
REPLACEMENT - LIFE & ANNUITY
Arkansas updated requirements for replacing life insurance policies and annuity contracts, rescinding Bulletin 8-2009. Life insurers may now use their own replacement memorandums - rather than a prescribed format - as long as they clearly compare the existing and replacement products. Bulletin 10-2025
TRADE PRACTICES
Illinois updated its rules to prohibit soliciting accident or health insurance from individuals over 65 or in nursing homes unless safeguards like reviewing current coverage, involving family, and a 48-hour waiting period are followed. It also restricts policy changes for those with diminished capacity without authorized consent and empowers the Insurance Director to void policies that violate these provisions. HB 1865
UTILIZATION REVIEW - HEALTH CARE
Pennsylvania issued a notice establishing fee schedules for Independent Review Organizations (IROs) as required by Act 146 of 2022. The notice details fees for standard and expedited external reviews of adverse benefit determinations across Medicaid/CHIP, commercial insurance, and experimental/investigational cases, emphasizing fees must be reasonable and customary. Certification of IROs, valid for two years, depends on meeting statutory standards, including fee reasonableness. Notice 2025-08