State RegulationsCO specificDifficulty 2/5
An insured who receives a federal subsidy bought an individual health benefit plan in Colorado issued to begin after January 1, 2014, and then stops paying premiums. Under C.R.S. § 10-16-140, what grace period applies?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
C.R.S. § 10-16-140 governs individual and small-employer health benefit plans issued or renewed to begin on or after January 1, 2014. For persons receiving a federal subsidy, the grace period is 3 MONTHS, and the plan continues coverage during that period, though the insurer may impose pro-rata premium liability for the span actually claimed. This is intentionally longer than the unsubsidized figure, because subsidized policyholders have subsidy payments in the pipeline.
Why the other options are wrong
- B) 31 days is the grace period for persons NOT receiving a subsidy — the subsidy status named in the stem changes the answer.
- C) 1 month is not a grace period Colorado recognizes for health benefit plans.
- D) 45 days is the paper-claim payment deadline under C.R.S. § 10-16-106.5, and premium liability is not extinguished during grace.
Memory hook
Subsidized = 3 months of grace; the plan stays on, pro-rata may pay.