(A) As used in this section and section 3924.032 of the Revised Code:

(1) "Health status-related factor" means any of the following:

(a) Health status;

(b) Medical condition, including both physical and mental illnesses;

(c) Claims experience;

(d) Receipt of health care;

(e) Medical history;

(f) Genetic information;

(g) Evidence of insurability, including conditions arising out of acts of domestic violence;

(h) Disability.

(2) "Network plan" means a health benefit plan of a carrier under which the financing and delivery of medical care, including items and services paid for as medical care, are provided, in whole or in part, through a defined set of providers under contract with the carrier.

(B) If a carrier offers a health benefit plan in the small employer market through a network plan, the carrier may do both of the following:

(1) Limit the small employers that may apply for such coverage to those with eligible employees who live, work, or reside in the service area of the network plan;

(2) Within the service area of the network plan, deny the coverage to small employers if the carrier has demonstrated both of the following to the superintendent of insurance:

(a) The carrier will not have the capacity to deliver services adequately to the members of any additional groups because of the carrier's obligations to existing group contract holders and members.

(b) The carrier is applying division (B)(2) of this section uniformly to all small employers without regard to the claims experience of those employers and their eligible employees and dependents or to any health status-related factor relating to such employees and dependents.

(C) A carrier that, pursuant to division (B)(2) of this section, denies coverage to a small employer in the service area of a network plan, shall not offer coverage in the small employer market within that service area for at least one hundred eighty days after the date the coverage is denied.

Effective Date: 06-30-1997 .