S 118 Session 112 (1997-1998)
S 0118 General Bill, By Giese
Similar(S 181, S 535)
A BILL TO AMEND TITLE 38, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO
INSURANCE, BY ADDING CHAPTER 91 SO AS TO PROVIDE THAT GENETIC INFORMATION
PERTAINING TO ACCIDENT AND HEALTH INSURANCE SHALL BE PRIVATE UNDER SPECIFIED
CONDITIONS, TO PROVIDE FOR THE MANNER IN WHICH SUCH INFORMATION MAY BE USED
AND DISCLOSED, AND TO PROVIDE CERTAIN CIVIL REMEDIES FOR VIOLATIONS.
01/14/97 Senate Introduced and read first time SJ-122
01/14/97 Senate Referred to Committee on Banking and Insurance SJ-122
A BILL
TO AMEND TITLE 38, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO INSURANCE, BY ADDING
CHAPTER 91 SO AS TO PROVIDE THAT GENETIC
INFORMATION PERTAINING TO ACCIDENT AND HEALTH
INSURANCE SHALL BE PRIVATE UNDER SPECIFIED
CONDITIONS, TO PROVIDE FOR THE MANNER IN WHICH
SUCH INFORMATION MAY BE USED AND DISCLOSED, AND
TO PROVIDE CERTAIN CIVIL REMEDIES FOR VIOLATIONS.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Title 38 of the 1976 Code is amended by adding:
"CHAPTER 91
Privacy of Genetic Information
Section 38-91-10. As used in this chapter:
(1) 'Genetic characteristic' means any scientifically or medically
identifiable gene or chromosome, or alteration thereof, which is
known to be a cause of disease or disorder, or determined to be
associated with a statistically increased risk of development of a
disease or disorder.
(2) 'Genetic information' means information about genes, gene
products, or inherited characteristics that may derive from an
individual or a family member.
(3) 'Genetic test' means a test for determining the presence or
absence of genetic characteristics in an individual in order to
diagnose a genetic characteristic.
Section 38-91-20. (A) No person when issuing, renewing, or
reissuing a policy, contract, or plan of accident and health insurance
providing hospital, medical and surgical, or major medical coverage
on an expense incurred basis, providing a corporate health services
plan, or providing a health care plan for health care services by a
health maintenance organization, on the basis of any genetic
information obtained concerning an individual or on the individual's
request for genetic services, with respect to such policy, contract, or
plan shall:
(1) terminate, restrict, limit, or otherwise apply conditions to
coverage of an individual or restrict the sale to an individual;
(2) cancel or refuse to renew the coverage of an individual;
(3) exclude an individual from coverage;
(4) impose a waiting period prior to commencement of coverage
of an individual;
(5) require inclusion of a rider that excludes coverage for certain
benefits and services; or
(6) establish differential in premium rates for coverage.
(B) In addition, no discrimination must be made in the fees or
commissions of an agent or agency for an enrollment, a subscription,
or the renewal of an enrollment or subscription of a person on the
basis of a person's genetic characteristics which under some
circumstances may be associated with disability in that person or that
person's offspring.
(C) Accident and health insurance as used in this chapter does not
include disability income insurance.
Section 38-91-30. All information obtained from genetic screening
or testing conducted before or after the effective date of this chapter
must be confidential and must not be made public or used in any way,
in whole or in part, to cancel, refuse to issue or renew, or limit
benefits under any accident or health insurance policy, contract, or
plan subject to the provisions of this chapter.
Section 38-91-40. No person may disclose any personal or
privileged genetic information about an individual collected or
received in connection with an accident or health insurance
transaction unless the disclosure is:
(1) with the written authorization of the individual, provided that
if the authorization is submitted by another insurer, agent, or
insurance-support organization, the authorization meets the
requirements of subitem (b) of item (2). If the authorization is
submitted by a person other than an insurer, agent, or
insurance-support organization, the authorization must be dated,
signed by the individual, and obtained one year or less prior to the
date a disclosure is sought pursuant to this item;
(2) to a person other than an insurer, agent, or insurance-support
organization, provided the disclosure is reasonably necessary:
(a) to enable that person to perform a business, professional, or
insurance function for the disclosing insurer, agent, or
insurance-support organization and that person agrees not to disclose
the information further without the individual's written authorization
unless the further disclosure would otherwise be permitted if made by
an insurer, agent, or insurance-support organization; or is reasonably
necessary for that person to perform its function for the disclosing
insurance institution, agent, or insurance-support organization; or
(b) to enable that person to provide information to the
disclosing insurer, agent, or insurance-support organization for the
purpose of determining an individual's eligibility for an insurance
benefit or payment or detecting or preventing criminal activity, fraud,
material misrepresentation, or material nondisclosure in connection
with an accident or health insurance transaction;
(3) to an insurer, agent, insurance-support organization, or
self-insurer, provided the information disclosed is limited to that
which is reasonably necessary;
(a) to detect or prevent criminal activity, fraud, material
misrepresentation, or material nondisclosure in connection with
accident or health insurance transactions; or
(b) for either the disclosing or receiving insurance institution,
agent, or insurance-support organization to perform its function in
connection with an accident or health insurance transaction involving
the individual;
(4) to a medical-care institution or medical professional for the
purpose of verifying insurance coverage or benefits, informing an
individual of a medical problem of which the individual may not be
aware or conducting an operations or services audit, provided that
information is disclosed as is reasonably necessary to accomplish the
foregoing purposes;
(5) to an insurance regulatory authority;
(6) to a law enforcement or other government authority;
(a) to protect the interests of the insurer, agent, or
insurance-support organization in preventing or prosecuting the
perpetration of fraud upon it; or
(b) if the insurer, agent, or insurance-support organization
reasonably believes that illegal activities have been conducted by the
individual; or
(c) upon written request of any law enforcement agency, for all
insured or claimant information in the possession of an insurer, agent,
or insurance-support organization which relates an ongoing criminal
investigation. The insurer, agent, or insurance-support organization
shall release the information including, but not limited to, policy
information, premium payment records, record of prior claims by the
insured or by another claimant, and information collected in
connection with an insurance company's investigation of an
application or claim. Any information released to a law enforcement
agency pursuant to the request must be treated as confidential
criminal investigation and not be disclosed further except as provided
by law. Notwithstanding any provision in this chapter, no insurer,
agent, or insurance-support organization shall notify an insured or
claimant that information has been requested or supplied pursuant to
this section prior to notification from the requesting law enforcement
agent that its criminal investigation is completed. Within ninety days
following the completion of the criminal investigation, the law
enforcement agency making the request for information shall notify
an insurer, agent, or insurance-support organization from whom
information was requested that the criminal investigation has been
completed;
(7) otherwise permitted or required by law;
(8) in response to a facially valid administrative or judicial order,
including a search warrant or subpoena;
(9) made for the purpose of conducting actuarial or research
studies provided (a) no individual may be identified in any actuarial
or research report, (b) materials allowing the individual to be
identified are returned or destroyed as soon as they are no longer
needed, and (c) the actuarial or research organization agrees not to
disclose the information unless the disclosure would otherwise be
permitted by this chapter if made by an insurer, agent, or
insurance-support organization;
(10) to a party or a representative of a party to a proposed or
consummated sale, transfer, merger, or consolidation of all or part of
the business of the insurer, agent, or insurance-support organization,
provided (a) before the consummation of the sale, transfer, merger,
or consolidation only the information is disclosed as is reasonably
necessary to enable the recipient to make business decisions about the
purchase, transfer, merger, or consolidation, and (b) the recipient
agrees not to disclose the information unless the disclosure would
otherwise be permitted by this chapter if made by an insurer, agent,
or insurance-support organization;
(11) to a person whose only use of the information shall be in
connection with the marketing of a product or service, provided (a)
no medical record information, privileged information, or personal
information relating to an individual's character, personal habits,
mode of living, or general reputation is disclosed, and no
classification derived from the information is disclosed, (b) the
individual has been given an opportunity to indicate that he does not
want personal information disclosed for marketing purposes and has
given no indication that he does not want the information disclosed,
and (c) the person receiving the information agrees not to use it
except in connection with the marketing of a product or service;
(12) to an affiliate whose only use of the information shall be in
connection with an audit of the insurer or agent or the marketing of
an accident or health insurance product or service, provided the
affiliate agrees not to disclose the information for any other purpose
or to unaffiliated persons;
(13) by a consumer reporting agency, provided the disclosure is to
a person other than an insurer or agent;
(14) to a group policyholder for the purpose of reporting claims
experience or conducting an audit of the insurer's or agent's
operations or services, provided the information disclosed is
reasonably necessary for the group policyholder to conduct the
review or audit;
(15) to a professional peer review organization for the purpose of
reviewing the service or conduct of a medical-care institution or
medical professional;
(16) to a governmental authority for the purpose of determining the
individual's eligibility for health benefits for which the governmental
authority may be liable;
(17) to a certificate holder or policyholder for the purpose of
providing information regarding the status of an accident or health
insurance transaction; or
(18) to a lienholder, mortgagee, assignee, lessor, or other person
shown on the records of an insurer or agent as having a legal or
beneficial interest in a policy of accident or health insurance,
provided that no medical record information is disclosed unless the
disclosure would be permitted by this chapter. The information
disclosed is limited to that which is reasonably necessary to permit
the person to protect his interest in the policy.
Section 38-91-50. Agents and insurance support organizations are
subject to the provisions of this chapter to the extent of their
participation in the issue, reissue, or renewal of a policy, contract, or
plan of accident and health insurance.
Section 38-91-60. (A) Any violation of this chapter is an unfair
trade practice as defined in Section 39-5-20 and is subject to the
provisions of Sections 39-5-110 to 39-5-160.
(B) Any individual who is injured by a person's violation of this
chapter may recover in a court of competent jurisdiction the
following remedies:
(1) equitable relief, which may include a retroactive order,
directing the person to provide health insurance appropriate to the
injured individual under the same terms and conditions as would have
applied had the violation not occurred; and
(2) an amount equal to any actual damages suffered by the
individual as a result of the violation.
(C) The prevailing party in an action under this section may
recover costs and reasonable attorneys' fees."
SECTION 2. This act takes effect upon approval by the Governor.
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