(a)Purpose. The purpose of this section is to encourage consumers to avail themselves of basic levels of benefits under group health insurance policies and contracts for the care and treatment of alcohol and other drug dependency, and to preserve the rights of the consumer to select the coverage according to the consumer’s medical-economic needs.
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Terms Used In Tennessee Code 56-7-2602

  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Department: means the department of commerce and insurance. See Tennessee Code 56-1-102
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b)Availability of Coverage for Alcohol and Other Drug Dependency.

(1) Insurers, nonprofit hospitals and medical service plan corporations and health maintenance organizations transacting health insurance in this state shall offer and make available under group policies, contracts and plans providing hospital and medical coverage on an expense-incurred, service or prepaid basis, benefits for the necessary care and treatment of alcohol and other drug dependency that are not less favorable than for physical illness generally, subject to the same durational limits, dollar limits, deductibles and coinsurance factors, and that offer of benefits shall be subject to the right of the group policy or contract holder to reject the coverage or to select any alternative level of benefits if the right is offered by or negotiated with the insurer, service plan corporation or health maintenance organization.
(2) Any benefits so provided shall be determined as if necessary care and treatment in an alcohol or other drug dependency treatment center were care and treatment in a hospital. For purposes of this section, “alcohol or other drug dependency treatment center” means a facility that provides a program for the treatment of alcohol or other drug dependency pursuant to a written treatment plan approved and monitored by a physician, and which facility is also:

(A) Affiliated with a hospital under a contractual agreement with an established system for patient referral;
(B) Licensed, certified or approved as an alcohol or other drug dependency treatment center by the department of mental health and substance abuse services; or
(C) Accredited as such a facility by the joint commission on accreditation of hospitals.
(c)Applicability. This section shall apply to group policies or contracts delivered or issued for delivery in this state more than one hundred twenty (120) days after October 1, 1982; but shall not apply to blanket, short term travel, accident only, limited or specified disease, individual conversion policies or contracts, or to policies or contracts designed for issuance to persons eligible for coverage under Title XVIII of the Social Security Act, known as medicare ( 42 U.S.C. § 1395 et seq.), or any other similar coverage under state or federal governmental plans.
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