Prevents insurance carriers from excluding an eligible individual or an eligible dependent, who applied for a health plan within 63 days of termination of prior creditable coverage, from a plan or impose a pre-existing condition exclusion or waiting period in any health plan if the individual meets the following criteria: the individual had 18 or more months of continuous credible coverage before applying, is not eligible for a group plan, and does not have other health insurance coverage. If an eligible individual does not meet the above-mentioned criteria, a carrier may subject the individual to a 6 month waiting period for pre-existing conditions with the exception of emergency services.

Provides definitions pertaining to merger of individual and small group health insurance markets.

Establishes insurance plan coverage criteria for Young Adults to be set by Division of Insurance. Only individuals between 19 & 26 who do not have employer-sponsored coverage are eligible for these products. Only insurance carriers with 5,000 or more enrollees may offer Young Adult plans, and the plans must be offered through the Connector.

Adds "eligible individuals" to those who do not qualify for "continuous coverage" under the state's mini-COBRA law due to the employer having only one or more than nineteen employees.

Requires the governing committee of the carrier-funded small-group reinsurance plan implemented in 1992 to establish a plan to phase out the program by June 2007.

Requires insurance carriers to disclose to prospective small business customers the surcharge that may be applied to the group’s premium and the participation requirements or participation rate adjustments for each health plan. • Requires insurance carriers to file electronically with the Division of Insurance rates and notification of actuarial methodology and any relevant changes prior to filing.

Provides that the Commissioner of the Division of Insurance may approve, according to established criteria, health insurance policies for individuals or small businesses that cover more restricted networks that differ from the overall carrier's network. The Commissioner may also disapprove any proposed rate changes if the Commissioner disapproves proposed rate increases to a small group plan, an insurance carrier must notify all members of the plan that the proposed increase has been disapproved and is subject to a public hearing. The carrier may not implement the proposed rates until the Commissioner has approved the rates.

Prevents insurance policies from excluding individuals based on age, occupation, health condition, claims experience, duration of coverage or medical condition. • Prevents insurance policies from excluding for more than 6 months preexisting conditions that were medically diagnosed or treated. Pregnancy existing on the date of enrollment is not included as a preexisting condition. • Plans offered to Trade Act/Health Coverage Tax Credit Eligible Persons may not include a waiting period or a pre-existing condition exclusion.

Requires insurance carriers to make available to individuals and small groups information for all plans and prices of plans offered to any other individuals and small groups. • Modifies the current requirement of carriers to make health benefit plans available in the following ways: Requires carriers to offer coverage effective within 30 days after application to any eligible individuals if they request coverage within 63 days of any prior creditable coverage. If the 63 day period has lapsed, carriers must offer coverage effective on the first day of the month following enrollment to eligible individuals who apply during the mandatory biannual open enrollment periods. • For a Trade Act/Health Coverage Tax Credit Eligible Individual, carriers may impose a 6 month exclusion of coverage for pre-existing conditions if the individual had less than 3 months of continuous coverage before becoming eligible for the tax credit or had a break in coverage for more than 62 days before applying for the plan. However, plans offered to individuals without creditable coverage for 18 months prior to application may not be subjected to a waiting period. • A carrier can deny enrollment in any plan if the carrier files with the Commissioner proof of intent to stop selling that plan. • Carriers can require individuals or groups of 1-5 to enroll in plans via the Connector or an intermediary.

Sets the factors used to set premiums for the merged individual and small group market. This section establishes a maximum rate band range from .66 to 1.32 for the following factors: age, industry rate, participation-rate rate, wellness program rate, and tobacco use rate. Additionally, carriers can apply only the following factors outside the rating band in establishing premiums: benefit level, geographic region, adjustment factor for an eligible individual and a small group, and group size. Additionally, requirements are laid out for which carriers with 5,000 or more members will be required to file a plan annually with the Connector to be considered for the "Connector Seal of Approval."