Legislature(1993 - 1994)
05/06/1994 08:35 AM House FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 534 "An Act relating to insurance, to the licensing,
accreditation, examination, regulation, and solvency
of persons engaged in the insurance business,
including insurers, nonadmitted insurers,
purchasing groups, risk retention groups, and United States
branches of alien insurers; relating to the
management of and the filing of reports by persons
licensed or otherwise doing business under the
insurance code; amending Alaska Rule of Civil
Procedure 45; and providing for an effective date."
CSHB 534 (FIN) was reported out of Committee with
individual recommendations and with a zero fiscal
note by the Department of Commerce and Economic
Development, 4/8/94.
HOUSE BILL NO. 534
"An Act relating to insurance, to the licensing,
accreditation, examination, regulation, and solvency of
persons engaged in the insurance business, including
insurers, nonadmitted insurers, purchasing groups, risk
retention groups, and United States branches of alien
insurers; relating to the management of and the filing of
reports by persons licensed or otherwise doing business
under the insurance code; amending Alaska Rule of Civil
Procedure 45; and providing for an effective date."
Co-Chair Larson provided members with a proposed committee
substitute, work draft # 8-LS1766\J, 5/5/94 (copy on file).
He noted that new language was added on page 60, line 3
through page 61, line 27.
JERRY RHEINWALD, LOBBYIST, BLUE CROSS testified in
opposition against the proposed committee substitute. He
asserted that the new section is targeted at Blue Cross. He
maintained that the issue is complex and complicated. He
suggested that more time is needed to look at the issue.
Representative Martin noted that new language was also added
in section 87 on page 58.
SHARON ANDERSON, ALASKA REGIONAL HOSPITAL testified in
support of the proposed committee substitute. She explained
that the proposed committee substitute provides for patient
access to hospitals and physicians of their choice. She
asserted that other insurance companies are already subject
to the provisions contained in the proposed committee
substitute.
Ms. Anderson clarified that the state of Alaska has utilized
preferred arrangements as the result of negotiations between
two parties without an open bid.
Representative Hanley noted that a "provider or hospital
willing to meet the terms and conditions of the preferred
provider may not be excluded."
Ms. Anderson described a "preferred provider arrangement".
Representative Therriault observed that there is a trade off
between price and volume.
GARY BREWER, CHIEF EXECUTIVE OFFICER, ALASKA REGIONAL
HOSPITAL stressed that the Alaska Regional Hospital has not
been allowed to participate as a bidder on contracts.
Ms. Anderson noted that Aetna has a preferred provider
arrangement with Providence Hospital. Aetna pays the
negotiated price for patients that choose to come to the
Alaska Regional Hospital. She noted that they wish to allow
medical service corporations to participate. She maintained
that the proposed committee substitute would help curb
costs. Mr. Brewer noted that health care inflation is at 4.9
percent.
Representative Navarre express concern with the cost of
health care inflation.
Representative Martin recommended that section 87 be removed
from the proposed committee substitute.
Representative Martin MOVED to ADOPT CSHB 534 (L&C).
(Tape Change, HFC 94-162, Side 1)
Co-Chair MacLean OBJECTED. A roll call vote was taken on the
MOTION.
IN FAVOR: Navarre, Hanley, Martin, Parnell, Therriault
OPPOSED: Brown, Foster, Hoffman, Grussendorf, MacLean,
Larson
The MOTION FAILED (5-6).
Co-Chair MacLean MOVED to ADOPT work draft # 8-LSl766\J,
5/5/94. Representative Martin OBJECTED. Representative
Martin WITHDREW his OBJECTION. There being NO OBJECTION, it
was so ordered.
PAUL FUHS, COMMISSIONER, DEPARTMENT OF COMMERCE AND ECONOMIC
DEVELOPMENT provided members with AMENDMENT 1 (copy on
file). He expressed concern that the legislation not become
the vehicle for workmen cGmpensation amendments.
KEN SYKES, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
noted that the provision for preferred providers was not
included in the senate companion bill. He noted that
amendment 1 contains technical changes to keep the
department in line with the national accreditation force,
National Association of Insurance Commissioners.
Mr. Sykes discussed the appointment of independent counsel
provision on page 60, line 3. He noted that an insured or
policy holder has the right to hire independent counsel for
defence under their insurance policy. This section attempts
to clarify the standards of this practice.
Representative Navarre MOVED to ADOPT AMENDMENT 1.
Representative Brown questioned the effect of the change on
page 9, line 9. Mr. Sykes explained that any document
received by the National Association of Insurance
Commissioners is a public document. The National Association
of Insurance Commissioners would be deleted by the amendment
in order to allow discretion, by the Division of Insurance,
of disclosure for market competition. Records can be
subpoenaed directly from the company involved.
There being NO OBJECTION, AMENDMENT 1 was adopted.
Representative Martin MOVED to delete section 87 on page 58.
Mr. Sykes noted that the Department of Commerce and Economic
Development is neutral in regards to section 87. Co-Chair
MacLean OBJECTED to the motion to delete sections 87.
Representative Navarre noted that section 87 is
controversial and has not had sufficient scrutiny.
Representative Hanley expressed concern that section 87 is
directed toward only Blue Cross.
Mr. Sykes explained that insurance companies are regulated
under AS 09. Medical service providers and hospital
organizations are different from insurance companies. He
noted that patients are reimbursed 80 percent for services
by a physician approved by the preferred provider. If the
patient goes to a doctor outside of the preferred provider
agreement they are reimbursed for only 75 percent of the
cost.
Section 87 would remove the five percent gap. He clarified
that the state's current health care contract would not be
directly effected since the contract is with Aetna. However,
VSP or eye care providers will have to comply with the
provision.
Representative Parnell expressed concern that long term
impacts of the provision contained in section 87 have not
been considered.
Representatives MacLean and Grussendorf spoke in support of
retention of section 87.
A roll call vote was taken on the MOTION to delete section
87.
IN FAVOR: Navarre, Hanley, Martin, Parnell, Therriault
OPPOSED: Brown, Foster, Hoffman, Grussendorf, MacLean,
Larson
The MOTION FAILED (5-6).
Representative Brown provided members with AMENDMENT CSHB
545 (L&C) (copy on file). She explained that the legislation
would prevent health insurance companies from discriminating
against marital and family therapists.
SHERRIE GOLL, ALASKA ASSOCIATION OF MARITAL AND FAMILY
THERAPISTS noted that the adoption of CSHB 545 (L&C) into
CSHB 534 (FIN) would add marital and family therapists to
the unfair discrimination statute.
Mr. Rheinwald spoke in opposition to the adoption of CSHB
545 (L&C). Commissioner Fuhs spoke in opposition to the
adoption of CSHB 545 (L&C).
Representative Brown MOVED to ADOPT CSHB 545 (L&C) as a new
section in CSHB 534 (FIN). Representative Martin OBJECTED. A
roll call vote was taken on the MOTION.
IN FAVOR: Brown, Hoffman
OPPOSED: Navarre, Grussendorf, Foster, Hanley, Martin,
Parnell, Therriault, MacLean, Larson
The MOTION FAILED (2-9).
Co-Chair MacLean MOVED to report CSHB 534 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. Representative Navarre OBJECTED.
A roll call vote was taken on the MOTION.
IN FAVOR: Grussendorf, Brown, Hoffman, Foster, Hanley,
Martin, Therriault, MacLean, Larson
OPPOSED: Navarre, Parnell
The MOTION PASSED (9-2).
CSHB 534 (FIN) was reported out of Committee with
"individual recommendations" and with a zero fiscal note by
the Department of Commerce and Economic Development, 4/8/94.
| Document Name | Date/Time | Subjects |
|---|