HB 278 (BR 1157) - T. Thompson, B. Smith, A. Arnold, J. Bowen, M. Cherry, T. Couch, R. Crimm, J. DeCesare, M. Denham, J. Draud, T. Edmonds, C. Embry Jr, T. Feeley, J. Fischer, D. Floyd, D. Ford, M. Harmon, J. Higdon, S. Lee, G. Lynn, P. Marcotte, R. Mobley, B. Montell, S. Nunn, R. Palumbo, T. Pullin, M. Rader, J. Reinhardt, S. Westrom, A. Wuchner, B. Yonts

     AN ACT relating to small business health insurance relief.
     Create new sections of Subtitle 17A of KRS Chapter 304 to create the Small Business Access Program to make health insurance more affordable for small employer groups with 2 to 10 employees; require all insurers, stop-loss carriers, and self-insured employer-controlled or bona fide associations to participate in the program as a supporting insurer or a participating insurer; require participating insurers to provide health benefit plans to small employer groups with 2 to 10 employees (Currently many companies do not provide small group coverage in any state, are KY legislators really that arrogant to think they CAN Force Billion Dollar companies to do this.  Kentucky's small population is but a small percent nationwide, HB 250 should have taught you that Frankfort will not dictate to the insurance industry. If you want to lower rates: reduce taxation, allow individual premium & claim deductibility on state tax returns without regard to adjusted gross income percentages, reduce regulation and all mandates, let the marketplace be served.)   and require supporting insurers to only be subject to assessments and payments through the program risk assessment process; define terms; deem as a participating insurer each insurer issuing health benefit plans in Kentucky in the small employer group market; exempt an insurer that provides coverage solely to Medicaid recipients, Medicare beneficiaries, or CHAMPUS insureds, and exempt self-insured health benefit plans covering employees of institutions of higher education and self-insured plans covering elected and salaried employees of cities, counties, urban-counties, charter counties, consolidated local governments, or special districts;(why exclude these entities if this were so good for the commonwealth and lower rates?) establish critieria for a program plan as a health benefit plan purchased by a qualified group that provides primary coverage for a member with a high-cost condition who is identified at the time of underwriting; prohibit the insurer from considering the high-cost condition or the claims experience of the individual with the high-cost condition in establishing rates for a qualified group; require insurers to report certain information to the Department of Insurance annually; require the department to establish an assessment process to fund program losses; establish the assessment rate as one-half of one percent of the total amount of all assessable health benefit plan premiums earned ( we are already the only STATE that imposes a local premium tax in addition to a 2% state level tax, some localities as high as 14%. This will cause premiums to rise & maybe carriers to consider leaving the state.  Besides, You already established the Ky Access Plan which has been a failure for high risk individuals) during the prior assessment period; require supporting insurers to report total stop-loss premiums and health benefit plan premiums and other information required by the department; require the department to establish and maintain a program fund; require the department to complete a risk adjustment process to determine actual program losses for each calendar year; direct the department to reimburse each participating insurer the amount of its reimbursable losses not to exceed the assessment available in the program account; require the commissioner to report on the operations of the program to the Legislative Research Commission prior to each regular session of the General Assembly; direct the Auditor of Public Accounts to be responsible for an audit of the program; require an insurer that issues group health benefit plans to an employer-organized association health benefit plan   (Maybe you do not remember, but Association Plans were available 12- 15 years ago, regulated under ERISA and most went bankrupt leaving insures and numerous agents liable for millions in claims. Employer association plans are simply smaller pools of insured which are subject to widely fluctuating rates and instability.  Third Party administrators make a killing in fees and legally can walk away from claims when filing bankruptcy) to provide information relating to the association's health benefit plan for the previous 3 years on aggregate claims experience, total premiums paid, total number of insureds, and detailed claims information; authorize insurers to offer one or more basic health benefit plans in the small group and employer-organized association markets which covers physician, pharmacy, home health, preventive, emergency, and inpatient and outpatient hospital services; permit the insurer that offers a basic benefit plan to, upon request, exclude mandated benefits except for state-mandated coverage of diabetes and hospice, federally mandated benefits, and mandated payment, indemnity, or reimbursement of specified health care providers for specific health care services; require insurers offering basic benefit plans to disclose to the small employer groups and employer-organized associations prior to issuance of the policy that the plan provides limited benefits, includes federal mandated benefits, and excludes state mandated benefits except for diabetes and hospice coverage; create a new section of KRS Chapter 367 to prohibit a health care provider from billing, charging, collecting a deposit, seeking compensation, remuneration, or reimbursement from an enrollee or subscriber for services, treatment, or supplies provided if the provider has entered into an agreement as a participating provider under a health benefit plan, or if there exists any appliable state or federal law which requires a hold harmless provision; provide for penalties enforceable by the Attorney General; amend KRS 205.560 to direct the Medical Assistance Program to use the form and guidelines established for assessing credentials of those applying to participate in the Medical Assistance Program; amend KRS 216.2923 to direct the cabinet to convene a permanent cabinet advisory committee to advise the secretary on the collection, analysis, and distribution of consumer-oriented information related to the health care system, the cost of treatment and procedures, outcomes and quality indicators, and policies and regulations to implement electronic collection and transmission of patient information and other cost-saving patient record systems; amend KRS 216B.155 to direct certain health care facilities to use the application form and guidelines for assessing credentials of those applying for privileges; amend KRS 304.17A-005 to define "basic health benefit plan" and "preventive services"; amend KRS 304.17A-545 to direct the commissioner of insurance to promulgate administrative regulations to establish uniform application form and guidelines for the evaluation and reevaluation of health care providers who will be on the plan's list of participating providers; amend KRS 304.17A-430, 304.17B-001, 304.17A-005, 304.18-114, and 304.38A-010 to conform.

HB 278 - AMENDMENTS

     HCS - Retain original provisions of the Act, except delete Section 12 pertaining to billing by health care providers who have entered into provider agreements; amend KRS 205.560 and KRS 216B.155 to make technical changes; amend KRS 216.2923(2)(e) to include nonphysician health care providers on the committee; amend KRS 304.17A-545(5) to include psychologists as a health care provider subject to to uniform application form and guidelines for evaluation and reevaluation.

     HFA (1, R. Damron) - Amend KRS 141.010 to include Title XII of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 in the definition of Internal Revenue Code.

     HFA (2/Title, R. Damron) - Make title amendment.

     HFA (3, L. Clark) - Prohibit supporting insurers from being assessed to generate moneys in the fund in excess of $15,000,000; prohibit a participating insurer from including in any rate filing the amount of any assessment that generates moneys in the fund in excess of $15,000,000.

     HFA (4, T. Thompson) - Provide that an insurer shall consider the high-cost condition or a portion thereof or the claims experience of the individual with the high-cost condition or a portion thereof is establishing rates for a qualified group pursuant to administrative regulations.

     Feb 3-introduced in House
     Feb 4-to Banking and Insurance (H); posted in committee
     Feb 9-reported favorably, 1st reading, to Calendar with Committee Substitute
     Feb 10-2nd reading, to Rules; posted for passage in the Regular Orders of the Day for Friday, February 11, 2005; floor amendment (1) filed to Committee Substitute, floor amendment (2-title) filed
     Feb 14-floor amendments (3) and (4) filed to Committee Substitute
     Feb 16-3rd reading, passed 96-0 with Committee Substitute, floor amendment (4)
     Feb 17-received in Senate
     Feb 18-to Banking and Insurance (S)