An insured who has submitted substantial claims receives a notice from her Massachusetts Medicare supplement insurer stating that her policy will not be renewed because of her high utilization. Under 211 CMR 71.07 and the guaranteed-renewability protections of Massachusetts Medicare supplement law, the insurer's action is:
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
211 CMR 71.07 guarantees that Massachusetts Medicare supplement policies renew, and the guaranteed-issue and nondiscrimination protections of M.G.L. c. 176K, § 3(a) forbid conditioning coverage on health status, claims experience, or medical condition. An insurer that terminates an insured for high utilization is doing exactly what these Massachusetts protections prohibit — converting her claims history into grounds for losing coverage. Timing the termination to an anniversary or offering a pricier substitute does not cure the violation enforced by the Massachusetts Division of Insurance.
Why the other options are wrong
- A) Claims experience is precisely not a lawful renewal criterion for a guaranteed renewable Medicare supplement policy under 211 CMR 71.07.
- B) Substituting a similar policy at a higher premium is a work-around, not compliance; the nonrenewal based on utilization remains unlawful.
- D) Anniversary timing does not legitimize a health-based nonrenewal; guaranteed renewability protects the insured at every renewal.
Memory hook
High claims are never a reason to drop a med-supps insured in Massachusetts.