(1) (a) A carrier that offers a health benefit plan in the state and that makes dependent coverage for children available under the health benefit plan shall make the coverage available for a child who is under twenty-six years of age. The carrier shall not deny or restrict coverage for a child who is under twenty-six years of age based on a factor such as:

(I) Residency with the policyholder or any other person;

(II) The presence or absence of financial dependence on the policyholder or any other person;

(III) Marital or civil union status;

(IV) Student status;

(V) Employment status; or

(VI) A combination of any of the factors listed in paragraphs (a) to (d) of this subsection (1).

(b) A carrier shall not deny dependent coverage of a child based on the child's eligibility for other coverage.

(c) Except as otherwise provided in state law, a carrier offering dependent coverage of children in a health benefit plan shall not vary the terms of coverage in the policy or contract based on age, except for premium rates for children who are twenty-one years of age or older.

(d) Nothing in this subsection (1) requires a carrier to make coverage available for the child of a child receiving dependent coverage unless the grandparent becomes the permanent legal guardian or adoptive parent of that grandchild.

(2) Repealed.

(3) (a) All individual and group sickness and accident insurance policies providing coverage within the state by an entity subject to the provisions of part 2 of this article and all group health service contracts issued by an entity subject to the provisions of part 3 or 4 of this article that provide dependent coverage to a child who is enrolled in a postsecondary educational institution shall not terminate coverage due to a medically necessary leave of absence before the date that is the earlier of:

(I) One year after the first day of the medically necessary leave of absence; or

(II) The date the coverage would otherwise terminate under the terms of the plan or health insurance coverage.

(b) For purposes of this subsection (3), "medically necessary leave of absence" means a leave of absence from a postsecondary educational institution or a change in enrollment of the dependent at the institution that:

(I) Begins while the dependent is suffering from a serious illness;

(II) Is medically necessary; and

(III) Causes the dependent to lose student status for the purpose of dependent coverage.