00 CS FOR HOUSE BILL NO. 29(L&C)(title am)
01 "An Act relating to the Comprehensive Health Insurance Association; granting a 50
02 percent premium tax credit for assessments against members of the Comprehensive
03 Health Insurance Association; requiring members to provide information to the
04 association's board of directors or the director of the division of insurance; modifying
05 voting rights for the association members by basing their exercise on a member's share
06 of assessments; basing assessments on major medical premiums; modifying the manner
07 of determining members' liabilities for losses; and changing the definition of "major
08 medical" coverage for purpose of state health insurance and providing for exclusions to
09 major medical coverage."
10 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
11 * Section 1. AS 21.09.210 is amended by adding a new subsection to read:
12 (p) A qualified insurer is entitled to a premium tax credit under AS 21.55.220.
01 * Sec. 2. AS 21.55.010 is amended adding a new subsection to read:
02 (b) A member shall submit reports and provide information required by the
03 board or the director to implement this chapter as a condition of transacting business
04 in the state.
05 * Sec. 3. AS 21.55.020(c) is amended to read:
06 (c) In determining voting rights at association meetings, an association
07 member is entitled to vote in person or by proxy. The vote shall be a weighted vote
08 based on the association member's share of assessments as determined under
09 AS 21.55.220 [PREMIUMS FOR HEALTH INSURANCE FOR MAJOR MEDICAL
10 COVERAGE ON AN EXPENSE INCURRED BASIS, OR THE ASSOCIATION
11 MEMBER'S SUBSCRIBER FEES, DERIVED FROM OR ON BEHALF OF STATE
12 RESIDENTS IN THE PREVIOUS CALENDAR YEAR, AS DETERMINED BY
13 THE DIRECTOR].
14 * Sec. 4. AS 21.55.220(c) is amended to read:
15 (c) Each member of the association shall share the losses due to claims
16 expenses of the state plans issued or approved for issuance by the association, and
17 shall share in the operating and administrative expenses incurred or estimated to be
18 incurred by the association incident to the conduct of its affairs. Claims expenses of
19 the state plan that exceed the premium payments allocated to the payment of benefits
20 shall be the liability of the members. Each member shall share in the claims expense
21 of the state plans and operating and administrative expenses of the association in an
22 amount equal to the ratio of the member's [TOTAL FEES FOR SUBSCRIBER
23 CONTRACTS OR] total major medical [HEALTH INSURANCE] premiums,
24 received from or on behalf of state residents, as divided by the total major medical
25 [SUBSCRIBER FEES AND HEALTH INSURANCE] premiums received by all
26 members from or on behalf of state residents, as determined by the director.
27 * Sec. 5. AS 21.55.220(d) is amended to read:
28 (d) The board shall make an annual determination of each member's liability,
29 if any, and may make an annual fiscal year end assessment if necessary. The board
30 may also [, SUBJECT TO THE APPROVAL OF THE DIRECTOR,] provide for
31 interim assessments against the members as may be necessary to assure the financial
01 capability of the association in meeting the incurred or estimated claims expenses of
02 the state plans and operating and administrative expenses of the association until the
03 association's next annual fiscal year end assessment. Payment of an assessment is due
04 within 30 days after [OF] receipt by a member of written notice of a fiscal year end or
05 interim assessment. A member who fails to pay a fiscal year end or interim assessment
06 as required in this subsection (1) shall pay a civil penalty to the director in the amount
07 of $100 for each day the member fails to pay the required assessment, and (2) may
08 have the member's certificate of authority revoked by the director. A member that
09 ceases to do [HEALTH INSURANCE] business in the state [, OR CEASES TO
10 OFFER SUBSCRIBER CONTRACTS IN THE STATE, DUE TO REVOCATION,
11 SUSPENSION, OR VOLUNTARY SURRENDER OF ITS CERTIFICATE OF
12 AUTHORITY,] remains liable for assessments until the board determines under (c)
13 of this section that no assessment is due [THROUGH THE CALENDAR YEAR
14 THAT THE HEALTH INSURANCE BUSINESS CEASED]. The board may decline
15 to levy an assessment against a member if the assessment would be minimal.
16 Assessments paid by a member are a general expense of the member.
17 * Sec. 6. AS 21.55.220 is amended by adding a new subsection to read:
18 (f) A member may offset 50 percent of the amount of the assessment under
19 this section as a premium tax credit reducing the premium tax payable by the member
20 under AS 21.09.210. The offset shall apply to the tax levied for the calendar year
21 following an annual determination of each member's liability under (d) of this section.
22 The offset may not reduce the premium tax payable by a member to less than zero or
23 create a premium tax credit for the member. An unused offset may be carried over to
24 the immediately following calendar year.
25 * Sec. 7. AS 21.55.500(14) is repealed and reenacted to read:
26 (14) "major medical"
27 (A) means health insurance or medical care coverage provided
28 on an expense incurred basis, including Medicare supplement insurance;
29 (B) does not include coverage for dental only, vision only,
30 long-term care, nursing home care, home health care, community-based care,
31 accident only, disability income, hospital confinement indemnity or other fixed
01 indemnity, or credit, specified disease or specified accident, or other
02 supplemental health insurance or coverage determined by the board not to
03 constitute major medical and approved by the director;
04 * Sec. 8. The uncodified law of the State of Alaska is amended by adding a new section to
06 APPLICABILITY. The provisions of sec. 6 of this Act apply to offset the premium
07 tax payable under AS 21.09.210 on March 1, 2008, based on assessments for the previous
08 year's determination of each member's liability, and shall continue annually thereafter.