Group underwriting, contributory and noncontributory plans, federal COBRA, HIPAA and the ACA's group rules are covered in the national Group Health Insurance guide. This guide covers Montana's group and blanket disability (health) statutes, Mont. Code Ann. 33-22-501 to 33-22-601, and its coordination of benefits rule, ARM 6.6.2401 and following.

Eligible groups and blanket coverage

• Group disability insurance may be issued to:
  • employers
  • associations, including labor unions organized for purposes other than obtaining insurance
  • multiple-employer trusts
  • other groups listed in the statute (33-22-501)
• Blanket disability insurance covers a changing group without naming each person (33-22-601). Examples:
  • passengers of a common carrier
  • students
  • sports teams
  • volunteer fire departments

Keeping coverage when things change

• Reduced work hours (33-22-507). If an employee's hours fall below the plan's minimum, coverage may continue for up to 1 year. This needs the consent of the employer or trustees, and the employee pays the same premium as others in the class.
• Death of the employee (33-22-503). A group policy may continue hospital, medical and surgical benefits for family members after the insured member dies.
• Disabled dependents (33-22-506). A disabled child stays covered past the limiting age if proof of incapacity is given within 31 days of reaching that age. After 2 years, the insurer may ask for proof no more than once a year.

Conversion privilege (33-22-508)

Coordination of benefits (ARM 6.6.2405)

When a person has two plans, the primary plan pays as if the other plan did not exist. The order is set by these rules:

1. A plan with no COB provision consistent with the rule is always primary. There's a narrow exception for supplemental group coverage.
2. Non-dependent before dependent. A plan covering the person as an employee is primary over one covering them as a dependent. There's an exception for certain Medicare situations.
3. Children of married parents. The birthday rule applies: the plan of the parent whose birthday comes earlier in the calendar year is primary.
4. Children of divorced parents, with no court decree. The order is:
   • custodial parent
   • custodial parent's spouse
   • noncustodial parent
   • noncustodial parent's spouse
5. Active before retired. Coverage as an active employee, or as the dependent of one, is primary over coverage as a retired or laid-off employee.
6. COBRA or state continuation coverage is secondary to coverage as an employee or an employee's dependent.
7. If nothing else decides, the plan that covered the person longer is primary.

Rate changes

Before changing rates or benefits, an insurer must give a group policyholder at least 60 days' notice (33-22-107). Individual policyholders get 45 days.

Common exam traps

• Conversion: insured 3 months, apply within 31 days, and no evidence of insurability.
• The conversion premium cap drops from 200% to 150% after 3 years of group coverage.
• Reduced-hours continuation lasts 1 year and requires employer or trustee consent.
• Under the birthday rule, the earlier birthday in the year is primary. The parents' ages don't matter.
• A plan with no COB provision is always primary. COBRA coverage is secondary.