Legislature(1997 - 1998)
05/06/1997 02:30 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE BILL 104
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"An Act relating to regulation and examination of
insurers and insurance agents; relating to kinds of
insurance; relating to payment of insurance taxes and
to required insurance reserves; relating to insurance
policies; relating to regulation of capital, surplus,
and investments by insurers; relating to hospital and
medical service corporations; and providing for an
effective date."
TIM BENINTENDI, STAFF, SENATOR TIM KELLY, stated that the
bill was requested by the Division of Insurance and contains
numerous provisions that will enhance the effectiveness,
efficiency and quality of insurance regulations for the
Alaskan consumer and industry. The majority of the
provisions implement the minimum federal standards for
individual and group health insurance plans as established
under the federal Health Insurance Portability and
Accountability Act of 1996 which will become effective in
Alaska by July 1, 1997. If the provisions are not enacted
in this legislative session, the federal Department of
Health and Human Services will take over regulations of
these standards in individual and group health insurance
markets in Alaska.
Mr. Benintendi provided a summary of the federal minimum
standards in the bill:
* In August 1996, the 1996 Act was signed into
federal law. The Act received wide
bipartisan support in Congress and by many
organizations including the American Medical
Association (AMA).
* Federal law establishes minimum standards for
all individual and group health care plans
which must become effective July 1, 1997.
These standards ensure that health coverage
is portable, available and renewable for many
individuals.
* If Alaska fails to enact the federal reforms
or otherwise, provides for enforcement of the
federal reforms, the federal government will
enforce compliance in Alaska beginning
January 1, 1998.
* Alaska has the option to implement an
alternative to the minimum individual health
insurance standards in federal law. This
legislation would provide for the necessary
amendments to the insurance code to implement
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such an alternative as well as other
amendments necessary to implement the minimum
group reforms.
* The bill would provide for a federally
acceptable alternative by modifying the
eligibility requirements for the
Comprehensive Health Insurance Association
(CHIA). This alternative would be the least
disruptive to Alaska's small individual
health insurance market.
Mr. Benintendi commented that Amendment #1, 0-LS0407\KA.4,
Ford, 5/5/97, was a refinement of an amendment provided on
the Senate floor to improve the legislation's intention.
[Copy on file]. He commented that Senator Kelly supports
the amendment.
Ms. Burke advised that the issue is currently before the
Alaska Supreme Court and involves contradictory federal
decisions. The federal court remanded it to the State
Supreme Court. The amendment would remove the ambiguity
which lead to the case and would clarify the intent.
(Tape Change HFC 97-125, Side 1).
MICHAEL LESSMEIER, STATE FARM INSURANCE, JUNEAU, agreed that
there exists a controversy about when the underinsured
motorist coverage is triggered. The policy decision made by
Senator Donley is reflected in Amendment #1. He believed
that the consideration is a complicated issue.
Representative Martin MOVED to adopt Amendment #1. There
being NO OBJECTION, it was adopted.
Mr. Lessmeier spoke to a concern regarding that the
maintenance of records provision being held for ten years,
Page 5, Line 31. He pointed out that this is longer than
any other state in the country. He requested it be changed
to five years. Ms. Burke responded that all domestic
insurers in the State of Alaska are required to keep their
records ten years. She added that the Division would have
no objection to changing it to five years. Mr. Benintendi
noted that the sponsor would not object to that change.
Representative Martin MOVED that language change on Page 5,
Line 31, deleting "ten years" and inserting "five years".
There being NO OBJECTION, it was adopted.
Representative Martin MOVED to report HCS CS SB 104 (FIN)
out of Committee with individual recommendations and with
the accompanying fiscal notes. There being NO OBJECTION, it
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was so ordered.
HCS CS SB 104 (FIN) was reported out of Committee with a "do
pass" recommendation and with a fiscal note by the
Department of Revenue and the Department of Commerce and
Economic Development.
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