Rescinding Advisory Memorandum Regarding New Federal Rules Governing Hospital Indemnity and Other Independent, Non-coordinated, Fixed Indemnity Coverage (issued 08/02/2024)

[LOGO] # COMMISSIONER OF SECURITIES AND INSURANCE James Brown Commissioner Office of the Montana State Auditor September 18, 2025 To: All Health and Fixed Indemnity and Excepted Benefits Insurers RE: Rescinding Advisory Memorandum Regarding New Federal Rules Governing Hospital Indemnity and Other Independent, Non-coordinated, Fixed Indemnity Coverage (issued 08/02/2024) To Whom It May Concern: The advisory memorandum issued by the Office of the Montana State Auditor, Commissioner of Securities and Insurance (CSI), on August 2, 2024, titled, “Advisory Memorandum Regarding New Federal Rules Governing Hospital Indemnity and Other Independent, Non-coordinated, Fixed Indemnity Coverage” is hereby rescinded. The advisory memorandum was necessitated by March 2024 final federal rules modifying the federal notice requirements for fixed indemnity insurance. However, those federal rules were invalidated by the federal district court in ManhattanLife Insurance and Annuity Co. v. U.S. Department of Health and Human Services (HHS), 2024 U.S. Dist. LEXIS 226832 (E.D. Tex. Dec. 4, 2024). HHS and the Departments of Labor and Treasury appealed to the Fifth Circuit Court of Appeals. However, at the request of the federal government, the appeal was dismissed on June 10, 2025. Consequently, the federal district court’s decision stands. Thus, the federal notice requirement that was the subject of CSI’s advisory memorandum is no longer valid or enforceable. Sincerely, James Brown Commissioner of Securities and Insurance Montana State Auditor 840 Helena Avenue, Helena, Montana 59601 (main fax) 406.444.3413 | (securities fax) 406.444.5558 (insurance consumer services fax) 406.444.1980 | (legal fax) 406.444.3499 (phone) 800.332.6148 or 406.444.2040 | (email) csi@mt.gov | (web) www.csimt.gov