20:06:21:01. Definitions. Terms used in this chapter mean:
(1) "Activities of daily living," bathing, dressing, eating, maintaining continence, toileting, and transferring;
(2) "Acute condition," a medically unstable condition that requires frequent monitoring of an individual by medical professionals, such as physicians and registered nurses;
(3) "Adult day care," a program of social and health-related services provided for six or more individuals during the day in a community group setting for the purpose of supporting frail, impaired elderly or other adults with disabilities who can benefit from care in a group setting outside the home;
(4) "Bathing," washing oneself by sponge bath or in a tub or shower, including the task of getting into or out of the tub or shower;
(5) "Chronically ill individual," any individual who has been certified by a licensed health care practitioner as:
(a) Being unable to perform (without substantial assistance from another individual) at least two activities of daily living for a period of at least 90 days due to a loss of functional capacity; or
(b) Requiring substantial supervision to protect the individual from threats to health and safety due to severe cognitive impairment.
The term, chronically ill individual, does not include an individual otherwise meeting these requirements unless within the preceding twelve-month period a licensed health care practitioner has certified that the individual meets these requirements;
(6) "Cognitive impairment," a deficiency in a person's short- or long-term memory; orientation as to person, place, and time; deductive or abstract reasoning; or judgment as it relates to awareness of safety;
(7) "Continence," the ability to maintain control of bowel or bladder function or, when unable to maintain control of bowel or bladder function, the ability to perform associated personal hygiene, including caring for a catheter or colostomy bag;
(8) "Dressing," putting on and taking off all items of clothing and any necessary braces, fasteners, or artificial limbs;
(9) "Eating," feeding oneself by getting food into the body from a receptacle such as a plate, cup, or table, by a feeding tube, or intravenously;
(10) "Exceptional increase," only those increases filed by an insurer as exceptional for which the director determines the need for the premium rate increase is justified:
(a) Due to changes in laws or rules applicable to long-term care coverage in this state; or
(b) Due to increased and unexpected utilization that affects the majority of insurers of similar products;
(11) "Hands-on assistance," the physical assistance, minimal, moderate, or maximal, without which the individual would not be able to perform the activities of daily living;
(12) "Home health care services," medical and nonmedical services provided to ill, disabled, or infirm persons in their residences, including homemaker services, as defined in § 67:40:07:01, assistance with activities of daily living, and respite care services;
(13) "Incidental," as used in § 20:06:21:67, the value of the long-term care benefits provided is less than ten percent of the total value of the benefits provided over the life of the policy. These values shall be measured as of the date of issue;
(14) "Independent review organization," an organization that conducts independent reviews of long-term care benefit trigger decisions;
(15) "Licensed health care practitioner," a physician, as defined in Section 1861(r)(1) of the Social Security Act, if approved by the director, a registered professional nurse, licensed social worker, or other individual who meets requirements prescribed by the Secretary of the Treasury;
(16) "Licensed health care professional," an individual qualified by education and experience in an appropriate field, to determine, by record review, an insured's actual functional or cognitive impairment;
(17) "Long-term care partnership policy," a long-term care insurance policy, which is designed to meet the requirements for asset disregard, as referenced in the state plan amendment effective July 1, 2007, under Medical Assistance and which meets the requirements of SDCL chapter 58-17B and this chapter, and which includes inflation protection consistent with the provisions of § 20:06:21:76;
(18) "Maintenance or personal care services," any care the primary purpose of which is the provision of needed assistance with any of the disabilities as a result of which the individual is a chronically ill individual (including the protection from threats to health and safety due to severe cognitive impairment);
(19) "Medicare," the federal program of health insurance for older persons provided under Title XVIII of the Social Security Amendments of 1965 and as amended through December 31, 1991, which is The Health Insurance for the Aged Act, amended (Title I, Part I of Pub. L. No. 89-97);
(20) "Mental or nervous disorder," a neurosis, psychoneurosis, psychopathy, psychosis, or mental or emotional disease or disorder;
(21) "Personal care," the provision of hands-on service to assist an individual with activities of daily living;
(22) "Qualified actuary," a member in good standing of the American Academy of Actuaries;
(23) "Qualified long-term care insurance contract" or "federally tax-qualified long-term care insurance contract":
(a) An individual or group insurance contract that meets the requirements of Section 7702B(b) of the Internal Revenue Code of 1986, as amended as of January 1, 2002, as follows:
(i) The only insurance protection provided under the contract is coverage of qualified long-term care services. A contract does not fail to satisfy the requirements of this subparagraph by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate;
(ii) The contract does not pay or reimburse expenses incurred for services or items to the extent that the expenses are reimbursable under Title XVIII of the Social Security Act, as amended as of January 1, 2002, or would be so reimbursable but for the application of a deductible or coinsurance amount. The requirements of this subparagraph do not apply to expenses that are reimbursable under Title XVIII of the Social Security Act only as a secondary payor. A contract does not fail to satisfy the requirements of this subparagraph by reason of payments being made on a per diem or other periodic basis without regard to the expenses incurred during the period to which the payments relate;
(iii) The contract is guaranteed renewable, within the meaning of section 7702B(b)(1)(C) of the Internal Revenue Code of 1986, as amended as of January 1, 2002;
(iv) The contract does not provide for a cash surrender value or other money that can be paid, assigned, pledged as collateral for a loan, or borrowed except as provided in subsection 20:06:21:01(22)(v);
(v) All refunds of premiums, and all policyholder dividends or similar amounts, under the contract are to be applied as a reduction in future premiums or to increase future benefits, except that a refund on the event of death of the insured or a complete surrender or cancellation of the contract cannot exceed the aggregate premiums paid under the contract; and
(vi) The contract meets the consumer protection provisions set forth in Section 7702B(g) of the Internal Revenue Code of 1986, as amended as of January 1, 2002; or
(b) The portion of a life insurance contract that provides long-term care insurance coverage by rider or as part of the contract and that satisfies the requirements of Sections 7702(B)(b) and (e) of the Internal Revenue Code of 1986, as amended as of January 1, 2002;
(24) "Qualified long-term care services," services that meet the requirements of Section 7702(c)(1) of the Internal Revenue Code of 1986, as amended as of January 1, 2002, as follows: necessary diagnostic, preventive, therapeutic, curative, treatment, mitigation, and rehabilitative services, and maintenance or personal care services which are required by a chronically ill individual, and are provided pursuant to a plan of care prescribed by a licensed health care practitioner;
(25) "Respite care services," care given to provide temporary relief for primary care given to a dependent person;
(26) "Severe cognitive impairment," a loss or deterioration in intellectual capacity that is comparable to, and includes, Alzheimer's disease and similar forms of irreversible dementia, and is measured by clinical evidence and standardized tests that reliably measure impairment of an individual in the following areas:
(a) Short-term or long-term memory;
(b) Orientation as to people, places, or time; and
(c) Deductive or abstract reasoning;
(27) "Toileting," getting to and from the toilet, getting on and off the toilet, and performing associated personal hygiene;
(28) "Transferring," moving into or out of a bed, chair, or wheelchair.
Source: 16 SDR 208, effective June 3, 1990; 22 SDR 97, effective December 18, 1995; 28 SDR 157, effective May 19, 2002; 31 SDR 21, effective August 23, 2004; 33 SDR 230, effective July 2, 2007; 34 SDR 88, effective September 10, 2007; 36 SDR 209, effective July 1, 2010.
General Authority: SDCL 58-4-1, 58-17B-4, 58-17B-15.
Law Implemented: SDCL 58-17B-2, 58-17B-4.
20:06:21:01.01. Nature of care -- How defined. The policy or certificate shall contain definitions for the terms, skilled nursing care, personal care, specialized care, assisted living care, home care, and other services, in relation to the level of skill required, the nature of the care, and the setting in which care must be delivered.
Source: 22 SDR 97, effective December 18, 1995; 33 SDR 230, effective July 2, 2007.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 58-17B-2, 58-17B-4.
20:06:21:01.02. Service providers -- How defined. The policy or certificate shall contain definitions for all providers of services, including skilled nursing facilities, extended care facilities, convalescent nursing homes, personal care facilities, specialized care providers, assisted living facilities, and home health care agencies in relation to the services and facilities required to be available and the licensure, certification, or registration or degree status of those providing or supervising the services. When the definition requires that the provider be appropriately licensed, certified, or registered, it shall also state what requirements a provider must meet in lieu of licensure, certification or registration when the state in which the service is to be furnished does not require a provider of these services to be licensed, certified or registered, or when the other state licenses, certifies, or registers the provider of services under another classification.
Source: 22 SDR 97, effective December 18, 1995; 33 SDR 230, effective July 2, 2007; 44 SDR 184, effective June 25, 2018.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 28-6-38(6), 58-17B-2, 58-17B-4.
20:06:21:01.03. Long-term care insurance. The term, long-term care insurance, includes group and individual annuities and life insurance policies or riders that provide direct coverage or supplement long-term care insurance. The term also includes a policy or rider that provides for payment of benefits based upon cognitive impairment or the loss of functional capacity. The term also includes qualified long-term care insurance contracts. Long-term care insurance does not include any insurance policy that is offered primarily to provide hospital confinement indemnity coverage, major medical expense coverage, or disability income or related asset-protection coverage. With regard to life insurance, this term does not include life insurance policies that accelerate the death benefit specifically for one or more of the qualifying events of terminal illness, medical conditions requiring extraordinary medical intervention, or permanent institutional confinement, and that provide the option of a lump-sum payment for those benefits, and where neither the benefits nor the eligibility for the benefits is conditioned upon the receipt of long-term care. However, any rider to a life insurance policy that accelerates benefits and:
(1) the amount of the accelerated benefit is unrelated to the reimbursement of long-term care services;
(2) contains no separate premium for the rider; and
(3) is not marketed as long-term care insurance
is not subject to the requirements for long-term care insurance.
Notwithstanding any other provision of SDCL chapter 58-17B, any product advertised, marketed, or offered as long-term care insurance or as an alternative to long-term care or nursing home insurance that conditions benefits based upon activities of daily living (ADLs) is subject to the provisions of chapter 20:06:21.
Source: 28 SDR 157, effective May 19, 2002; 32 SDR 203, effective June 5, 2006.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 58-17B-2.
20:06:21:01.04. Similar policy forms. For purposes of this chapter, similar policy forms, are all of the long-term care insurance policies and certificates issued by an insurer in the same long-term care benefit classification as the policy form being considered. Certificates of groups that meet the definition in SDCL 58-17B-2(4)(a) are not considered similar to certificates or policies otherwise issued as long-term care insurance, but are similar to other comparable certificates with the same long-term care benefit classifications. For purposes of determining similar policy forms, long-term care benefit classifications are defined as follows: institutional long-term care benefits only, non-institutional long-term care benefits only, or comprehensive long-term care benefits.
Source: 28 SDR 157, effective May 19, 2002; 30 SDR 39, effective September 28, 2003.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 58-17B-2.
20:06:21:01.05. Treatment of accelerated benefits in life insurance. Accelerated benefits payable under a life insurance contract:
(1) To a policyowner or certificateholder, during the lifetime of the insured, in anticipation of death or upon the occurrence of specified life-threatening or catastrophic conditions as defined by the policy or rider; and
(2) That reduce the death benefit otherwise payable under the life insurance contract; and
(3) That are payable upon the occurrence of a single qualifying event that results in the payment of a benefit amount determined at the time of acceleration
are not considered to be charging a separate premium pursuant to § 20:06:21:01.03.
Source: 32 SDR 203, effective June 5, 2006.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 58-17B-2.
20:06:21:01.06. Claim and clean claim -- Defined. For purposes of §§ 20:06:21:104 to 20:06:21:108, inclusive, terms used mean:
(1) "Claim," a request for payment of benefits under an in-force policy, regardless of whether the benefit claimed is covered under the policy or any terms or conditions of the policy have been met;
(2) "Clean claim," a claim that has no defect or impropriety, including any lack of required substantiating documentation, such as satisfactory evidence of expenses incurred, or particular circumstance requiring special treatment that prevents timely payment from being made on the claim.
Source: 36 SDR 209, effective July 1, 2010.
General Authority: SDCL 58-17B-4.
Law Implemented: SDCL 58-17B-4.
