Ch. 9                                        1993 LAWS OF MARYLAND

(i) Not be in the best interests of policyholders or certificate holders;
or

(ii) Impair the carrier's ability to meet its contractual obligations; or

(8) If the carrier is a health maintenance organization, for reasons stated in
§ 19-725(b) of the Health - General Article.

            (c) When a carrier elects not to renew all health benefit plans in the State, the
carrier:

(1) Shall give notice of its decision to the affected small employers and the
insurance regulatory authority of each state in which an eligible employee or dependent
resides at least 180 days before the effective date of nonrenewal;

(2) At least 30 working days before that notice, shall give notice to the
Commissioner; and

(3) May not write now business for small employers in the State for a 5-year
period beginning on the date of notice to the Commissioner.]

703.

(a)     A carrier shall apply all risk adjustment factors under § 702 of this subtitle
consistently with respect to all health benefit plans issued, delivered, or renewed in the State.

(b)     (1) A carrier may not arbitrarily transfer a [small employer] GROUP OR
INDIVIDUAL involuntarily into or out of a health benefit plan.

(2) A carrier may not offer to transfer a [small employer] GROUP OR
INDIVIDUAL into or out of a health benefit plan unless the offer to transfer is made to all
[small employers ] INDIVIDUALS OR GROUPS with similar risk adjustment factors.

(c)     A carrier shall make a reasonable disclosure in its solicitation and sales materials

(1)     The provisions concerning the carrier's right to change premium rates,
including any factors that may affect the changes in premium rates;

(2)     The provisions relating to renewability of policies and contracts; and

(3)     The provisions relating to any preexisting condition provision.

(d)     (1) A carrier shall base its rating methods and practices on:

(i) Commonly accepted actuarial assumptions; and

(ii) Sound actuarial principles.                                         

(2) Subject to the approval of the Commissioner and as provided under §
704(a)(3) of this subtitle, a carrier may impose reasonable minimum participation
requirements.

(e)    To indicate compliance with subsections (c) and (d) of this section, a carrier shall
maintain information and documentation that is satisfactory to the Commissioner.

- 596 -