17B:27A-8. Offering of certain coverage not required

7. a. A health maintenance organization shall not be required to offer coverage to or accept an applicant pursuant to this act if:

(1) the eligible individual does not live, reside, or work within the health maintenance organization's approved service area; and

(2) the carrier has demonstrated to the commissioner that the carrier will not have the capacity to deliver services adequately to additional eligible persons because of its obligations to existing group contract holders and enrollees and individual enrollees and it applies this paragraph uniformly to individuals without regard to any health status-related factor of such individuals and without regard to whether the individuals are eligible persons. Upon denying individual health benefits coverage pursuant to this paragraph, a carrier may not offer such coverage in the individual market for a period of 180 days after the date the coverage is denied. If the health maintenance organization does not have the capacity in its facilities for additional individual enrollees, it also shall not offer coverage to or accept any new group enrollees.

b. A carrier shall not be required to offer coverage or accept applications pursuant to this act if the commissioner determines that the carrier does not have the financial reserves necessary to underwrite additional coverage. Upon denying individual health benefits coverage pursuant to this subsection, a carrier may not offer such coverage in the individual market for a period of 180 days after the date the coverage is denied or until the carrier has demonstrated to the commissioner that the carrier has sufficient financial reserves to underwrite additional coverage, whichever is later.

L.1992,c.161,s.7; amended 1997, c.146, s.5.