Subchapter D. STATEMENTS OF POLICY
Sec.
67.41. Eligibility guidelines for the Catastrophic Loss Trust Fund for accidents on and after June 1, 1989.
67.42. Phase-in of extraordinary medical benefit coverage.
67.43. Coordination of benefits between the Catastrophic Loss Trust Fund and Extraordinary Medical Benefit Coverage.
67.44. EMB coverage provided by nonautomobile insurers.
67.45. Nondiscrimination in availability of approved EMB coverage.§ 67.41. Eligibility guidelines for the Catastrophic Loss Trust Fund for accidents on and after June 1, 1989.
(a) Section 1798.2(a) of the act (relating to transition), added by the act of April 26, 1989 (P. L.
, No. 4) (Act 4), continues the Catastrophic Loss Trust (CAT) Fund eligibility for certain individuals suffering catastrophic losses after June 1, 1989. The Department will be guided by this section in making eligibility determinations for accidents occurring on or after 12:01 a.m., June 1, 1989.(b) Natural persons who suffer catastrophic losses on or after 12:01 a.m., June 1, 1989, may be eligible for benefits from the CAT Fund if the following apply:
(1) They are injured in an accident arising out of the maintenance or use of a motor vehicle.
(2) The accident giving rise to the claim for CAT Fund benefits occurred during the registration year for which the CAT Fund charge had been paid on one or more of the motor vehicles involved in the accident.
(3) They otherwise are ‘‘eligible claimants’’ as defined in 75 Pa.C.S. § 1761 (repealed).
Source The provisions of this § 67.41 adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
Cross References This section cited in 31 Pa. Code § 67.43 (relating to coordination of benefits between Catastrophic Loss Trust Fund and Extraordinary Medical Benefit Coverage).
§ 67.42. Phase-in of extraordinary medical benefit coverage.
(a) Mandatory offering. The act of April 26, 1989 (P. L.
, No. 4) (Act 4) amends the act to require automobile insurers to offer extraordinary medical benefit (EMB) coverage as of June 1, 1989. Insurers shall offer to bind this coverage as of June 1, 1989 if so requested by the policyholder. This includes policyholders who have been bound or assigned to an insurer under the Assigned Risk Plan. Policyholders who have already requested EMB or similar coverage from their insurer need not provide the insurer with additional notice to have this coverage effective as of June 1, 1989.(b) Notice to policyholders. By May 24, 1989, insurers should send a notice to policyholders in the form required by section 1798.2(c) of the act (relating to transition), except that if the insurer is utilizing the interim rate specified in subsection (e), appropriate revisions may be made in the interest of fully and accurately informing the policyholder. Insurers that have sent a notice to policyholders regarding an approved catastrophic loss filing by May 8, 1989 will be deemed to have satisfied the requirement of this subsection.
(c) Rate filing. Insurers are required by section 1798.2(b) of the act to make an EMB rate filing with the Department by May 26, 1989, that date being 30 days from the effective date of section 1798.2 of the act. This filing requirement includes those insurers which had obtained Departmental approval of catastrophic loss rates by April 26, 1989—the effective date of section 1798.2 of the act. However, those insurers may file amendments to their approved catastrophic loss filings with the changes necessary to comply with Act 4. No initial EMB rate filing or amendment to an approved catastrophic loss filing may be deemed into effect.
(d) Insurers with approved catastrophic loss rates and forms. Insurers which have obtained Departmental approval for catastrophic loss rates and forms by April 26, 1989 shall utilize those rates and forms for EMB endorsements issued effective on or after June 1, 1989 until the Department approves a new EMB rate or form. The insurer shall pro-rate the catastrophic loss premium to the next policy renewal. Insurers which are subscribers to a licensed rating organization that had obtained Departmental approval of catastrophic loss rates by April 26, 1989 may elect to utilize the rating organization’s approved rates and forms for EMB coverage until the rating organization receives approval of a revised filing under subsection (c). With approval of the Department, subscribers may utilize deviations from the rate and form approved for a rating organization if the deviation provides for a rate reduction and the form provides more liberal coverage. Insurers planning to utilize the rating organization’s rates and forms or deviations shall inform the Department of their intent by May 26, 1989.
(e) Interim rate and forms. Insurers are obligated by Act 4 to offer to bind EMB coverage as of June 1, 1989. However, Act 4 does not relieve insurers that had not obtained Departmental approval for catastrophic loss rates and forms by April 26, 1989 from the requirements under section 4(h) of the Casualty and Surety Rate Regulatory Act (40 P. S. § 1184(h)) and section 354 of the Insurance Company Law of 1921 (40 P. S. § 477b) that rates and forms be approved by the Department prior to use. Under the Commissioner’s authority under the Casualty and Surety Rate Regulatory Act (40 P. S. § § 1181—1199), the requirement of preapproved rates for EMB coverage is temporarily suspended if an insurer utilizes the interim Statewide rate of $38 per motor vehicle, per year. The interim rate is to be utilized for EMB endorsements issued effective on or after June 1, 1989, until the Department approves the insurer’s EMB rate filing. The interim EMB rate shall be prorated to the next policy renewal. Insurers not having approved EMB forms may utilize the form in Appendix A.
(f) Enforcement action. The Department may take enforcement action against insurers failing to offer to bind EMB coverage as of June 1, 1989. However, the Department will not take enforcement action against insurers utilizing the interim rates and forms specified in subsection (e) prior to the Department’s approval of n insurer’s EMB rates and forms.
Source The provisions of this § 67.42 adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
§ 67.43. Coordination of benefits between the Catastrophic Loss Trust Fund and Extraordinary Medical Benefit Coverage.
An individual eligible for CAT Fund benefits under § 67.41 (relating to eligibility guidelines for the Catastrophic Loss Trust Fund for accidents on and after June 1, 1989) may also be insured for EMB coverage. In these instances, the EMB carrier is primary and the CAT Fund secondary. No duplicate recovery may be available. The total lifetime aggregate to one individual under both EMB coverage and the CAT Fund may not exceed $1 million dollars.
Source The provisions of this § 67.43 adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
§ 67.44. EMB coverage provided by nonautomobile insurers.
Section 1715(e) of the act (relating to availability of adequate limits), added by the act of April 26, 1989 (P. L.
, No. 4) authorizes insureds to obtain EMB coverage through nonautomobile insurers and other arrangements. The Department interprets this provision as authorizing commercial accident and health insurers, Professional Health Service Plan Corporations, and Hospital Plan Corporations to offer EMB coverage as defined in the act, as either a freestanding policy or a part of another policy. An insurer, Health Maintenance Organization, Preferred Provider Organization, Professional Health Service Plan Corporation or Hospital Plan Corporation shall obtain the approval of the Department prior to offering this coverage.
Source The provisions of this § 67.44 adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
§ 67.45. Nondiscrimination in availability of approved EMB coverage.
Insurers shall make available to an applicant or policyholder all levels of extraordinary medical benefit coverage approved for use by the Department.
Source The provisions of this § 67.45 adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
Source The provisions of this Appendix A adopted May 19, 1989, effective May 8, 1989, 19 Pa.B. 2178.
Cross References This section cited in 31 Pa. Code § 67.42 (relating to phase-in extraordinary medical benefit coverage).
APPENDIX B
Section
1761. Definitions (Repealed).
1762. Funding (Repealed).
1766. Benefits (Repealed).
Source The provisions of this Appendix B adopted October 30, 1998, effective October 31, 1998, 28 Pa.B. 5482.
§ 1761. Definitions (Repealed).
The following words and phrases when used in this subchapter shall have the meanings given to them in this section unless the context clearly indicates otherwise:
‘‘Administrator.’’—The administrator designated by the Catastrophic Loss Trust Fund Board.
‘‘Board.’’—The Catastrophic Loss Trust Fund Board.
‘‘Catastrophic loss.’’—An injury, arising out of the maintenance or use of a motor vehicle, for which the reasonable and necessary expenses for medical treatment and rehabilitative services, as described in section 1712(1) (relating to availability of benefits), exceed $100,000.
‘‘Catastrophic loss benefit.’’—Payments by the Catastrophic Loss Trust Fund for those reasonable and necessary expenses only for medical treatment and rehabilitative services which, as described in section 1712(1), exceed $100,000, subject to the limitations provided in section 1766 (relating to benefits). Catastrophic loss benefits shall not duplicate any other payments for medical treatment and rehabilitative services.
‘‘Eligible claimant.’’—Except as provided in the definition of ineligible claimant, eligible claimant includes a resident of this Commonwealth who suffers injury on or after the effective date of this subchapter arising out of the maintenance or use of a motor vehicle in the United States, its territories or possessions and Canada. The estate of an eligible claimant shall be entitled to receive catastrophic loss benefits pursuant to section 1766 to the extent that financial obligations for reasonable and necessary medical treatment and rehabilitative services were incurred by the eligible claimant prior to the death of that person. Otherwise eligible claimants shall not be disqualified from participating in or receiving benefits from the Catastrophic Loss Trust Fund for injuries suffered after the effective date of this subchapter but prior to their first registration renewal after the effective date of this subchapter.
‘‘Executive director.’’—The executive director of the Catastrophic Loss Trust Fund Board.
‘‘Fund.’’—The Catastrophic Loss Trust Fund.
‘‘Fund charge.’’—The fund charge established under this subchapter.
‘‘Ineligible claimant.’’—Any of the following:(1) A person who is the owner of a motor vehicle who has not complied with the registration requirements of Chapter 13 (relating to registration of vehicles).
(2) A person who is the driver or occupant of a recreational vehicle not intended for highway use, a motorcycle, a motorized pedalcycle, a motor-driven cycle or like type vehicle required to be registered under this title but not subject to the charge levied in section 1762 (relating to funding).
‘‘Manager.’’—The manager designated by the Catastrophic Loss Trust Fund Board.§ 1762. Funding (Repealed).
The Catastrophic Loss Trust Fund shall be funded by levying an initial charge of $5 upon all motor vehicles required to be registered under Chapter 13 (relating to registration of vehicles) except trailers, recreational vehicles not intended for highway use, motorcycles, motor-driven cycles, motorized pedalcycles or like type vehicles. This charge shall be remitted to an insurance company or other party as may be designated by the Insurance Department. Upon receipt of the charge, the insurance company or other designated party shall remit it to the Insurance Department for deposit in the trust fund. The Catastrophic Loss Trust Fund Board shall by regulation determine by January 1 of each calendar year the amount of the fund charge for each registration year subsequent to the initial registration year and shall notify the Insurance Department which shall notify the insurance companies or other designated parties to collect the charge.
§ 1766. Benefits (Repealed).
(a) General rule.—Subject to the limitations set forth in subsection (b), the Catastrophic Loss Trust Fund shall provide catastrophic loss benefits to eligible claimants only for the payment of expenses for medical treatment and rehabilitative services in excess of $100,000. No payment shall be made by the fund for the first $100,000 of expense for medical treatment and rehabilitative services incurred by an eligible claimant.
(b) Maximum benefit.—The maximum catastrophic loss benefit which shall be paid by the fund on behalf of any one eligible claimant shall be $50,000 per year and $1,000,000 lifetime aggregate. During the first 18 months of eligibility, the administrator may approve payments on behalf of a claimant without regard to the $50,000 per year limit but subject to the $1,000,000 lifetime aggregate.
(c) Effect of other benefits.—Except for workers’ compensation, catastrophic loss benefits paid or payable by the fund shall be primary to any other available source of accident or health benefits including any program, group contract or other private or public source of benefits unless the law authorizing or providing those benefits makes the benefits primary to the benefits provided under this subchapter.
(d) Structured settlements.—The administrator may enter into structured settlements to pay benefits under this subchapter. Where it appears the settlement will be both cost effective to the fund and in the best interest of the claimant, the restrictions in subsection (b) shall not apply to this subsection, but in no event shall the cost of the structured settlement exceed the present value of the future annual payments up to the maximum lifetime aggregate benefit remaining calculated at 6% simple interest.
(e) Preclusion of pleading, proving and recovering benefits.—In any action for damages against a tortfeasor arising out of the maintenance or use of a motor vehicle, a person who is eligible to receive catastrophic loss benefits shall be precluded from pleading, introducing into evidence or recovering the amount of medical and rehabilitative expenses for which catastrophic loss benefits were paid or are payable. This preclusion applies only to catastrophic loss benefits.
(f) Subrogation.—There shall be no subrogation or reimbursement from a claimant’s tort recovery with respect to catastrophic loss benefits.
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