Legislature(2015 - 2016)HOUSE FINANCE 519
04/07/2016 08:30 AM FINANCE
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HOUSE BILL NO. 188 "An Act relating to financial accounts for persons with disabilities; relating to financial institutions; relating to property exemptions; relating to securities; and providing for an effective date." 9:10:41 AM Co-Chair Neuman MOVED to ADOPT the proposed committee substitute for HB 188, Work Draft (29-LS0787\G). There being NO OBJECTION, it was so ordered. Representative Thompson invited his staff, Mr. Anderson to the table to explain the differences between Version I [N] and the committee substitute version G. BRODIE ANDERSON, STAFF, REPRESENTATIVE STEVE THOMPSON, explained the changes to the committee substitute. There were four changes in the bill from the previous version. He noted the first change was on Page 1 of the previous Version P [N] on lines 2 and 3 in the title. It deleted "Creating a limited property exemption for money in or paid from a financial account in the program with an individual with a disability". The second change was on Page 9, lines 2-8 of Version P [N]. It deleted Section 06.65.260, the exemption from creditor claims which removed the exemption from the bill. The third change was also in Version P [N] on Page 11 , lines 20-12 [17-18]. It deleted conforming language from subsection 11. The final change was all other sections after the deletion were remunerated to reflect the new sections. 9:12:37 AM Representative Munoz asked Mr. Anderson to repeat the first change. Mr. Anderson responded that it was a title change which deleted the sections referencing the exemption. In the previous version the lines were on Page 1, lines 2-3. Vice-Chair Saddler wanted to answer two questions from earlier meetings. There had been a question about whether there was a need for funds in the ABLE account to be protected from creditors. In the CS before the committee the section was deleted that would have provided the protection against creditors and state law including child support orders. There was no inhibition to prevent a creditor from going after the amount of funds in the account. One of the questions that had been asked concerned the lack of a zero fiscal note from Department of Health and Social Services (DHSS). The department had consulted with Department of Revenue (DOR) and currently there was a zero fiscal note reflecting the minimal to implement the bill. The cost could be covered with the department's existing budget. There had been some discussion about what level of disability qualified a person to open an ABLE account and how a disability was determined. He answered that a person had to either be eligible for supplemental security income or meet the same standard. The standard stated that the disability standard for children for claiming benefits under the supplemental security income program was based on the disability which meant that they had to have marked and severe functional limitations. The certification of the limitations had to include a copy of the individual's diagnosis relating to that person's relative impairments and signed by a licensed physician under the penalty of perjury. Vice-Chair Saddler continued that there was a question as to how to be sure a person was using their ABLE account for the appropriate expenses. The answer was that they had to file the appropriate paperwork with the IRS to document their deposits and their disbursements from their ABLE account. If someone were to lie on their tax return they would be subject to the same penalty that placed Al Capone in jail. Lastly, it was asked at what level of precedence did the state have in recovering Medicaid expenses from an ABLE account. The state was fifth. He elaborated that the order of precedence was that first their estate went to pay the costs and expenses for the administration of the estate; second, the regional funeral expenses; third, debts and taxes with a federal preference for child support past due payments; fourth, reasonable and necessary medical expenses of the last illness of the person who died; fifth, debts and taxes with preference including Medicaid payments; and sixth, all other claims. If there was any other money remaining it would go to the person's estate to be disposed of by will or through the probate court process. 9:15:50 AM Representative Gattis thanked the sponsor. She thought the bill was better in the current day than in the previous day. Vice-Chair Saddler appreciated the thoroughness of the committee process. 9:16:16 AM Representative Kawasaki asked about the fiscal note. He stated that part of the ABLE Act was to shield assets within the account for purposes of Medicaid and other programs. He thought it would have a fiscal impact if the account was no longer an asset of the individual. Vice-Chair Saddler responded in the negative. He explained that Medicaid was not a means except for the original qualification. He relayed that the means testing was primarily for supplemental security income. 9:17:03 AM Representative Kawasaki asked if it included other programs the state had specifically through the group that also had asset tests. Vice-Chair Saddler responded in the affirmative. 9:17:18 AM Representative Gara remarked that there would be a certain number of additional people who would qualify for Medicaid which he thought was appropriate. He hoped in the following year the legislature would not have to make additional cuts to make up for it. He thought the individuals deserved treatment. He asked Vice-Chair Saddler if he had an opinion on the issue. Vice-Chair Saddler did not see how it would add to the categories of people who qualified for Medicaid. 9:17:56 AM Representative Gara indicated the bill would help shield assets from being counted which he thought was completely fine. He thought some people would qualify for Medicaid who currently did not. 9:18:15 AM KIM SKIPPER, STAFF, REPRESENTATIVE DAN SADDLER, responded that the bill was intended for disabled people, some who could be on Medicaid and social security income. However, she did not think it would add to the number of people on Medicaid but would enable the people in the disabled condition to save money. Vice-Chair Saddler added that it would be people who were disabled and often did not have income. He did not believe there would be many people that would be working, earning income, and having an ABLE account sheltering income. The point of the bill was to shelter their income from interest on an account. 9:19:14 AM Representative Gara did not have a problem with additional recipients. He just did not want to have to see an additional reduction to offset it. He also asked if disabled people would no longer be protected from creditors on the ABLE account with the new version of the bill. He wondered if the representative was comfortable with the change. Vice-Chair Saddler stated that he was correct. The protections were removed in the newest version of the bill. He was comfortable because he did not see much of a risk of someone going bankrupt. There was an interest and concern expressed about people that would potentially seek to abuse the account. He did not see much of a risk and did not think the protection was all that effective in the first place. 9:20:22 AM Representative Wilson stated that the definition from the previous day versus how it was depicted in the current version of the bill was much different. She was in support of the bill. She knew folks who had wanted to get part time jobs. However, social security took $2 away from a person for every dollar they made which was not a big incentive to get a job. She thought any extra income was a benefit. The bill would allow folks to get a job without being penalized. She really appreciated a better definition which made her feel more comfortable with the legislation. She thanked the bill sponsor. 9:21:28 AM Co-Chair Neuman reviewed the fiscal notes from the bill. 9:22:07 AM Co-Chair Neuman MOVED to REPORT CSHB 188 (FIN) out of committee with individual recommendations and the accompanying zero and fiscal impact notes. There being NO OBJECTION, it was so ordered. CSHB 188 (FIN) was REPORTED out of committee with a "do pass" recommendation and with one zero fiscal note by the Department of Health and Social Services and one fiscal impact note by the Department of Revenue. Co-Chair Thompson reviewed the agenda for the following meeting.
|HB 188 NEW FN DOR T&T 4-6-16.pdf||
HFIN 4/7/2016 8:30:00 AM
|HB 188 CS WORKDRAFT FIN vG.pdf||
HFIN 4/7/2016 8:30:00 AM