Legislature(2015 - 2016)BARNES 124
04/04/2016 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| SB125 | |
| HB372 | |
| HB299 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 125 | TELECONFERENCED | |
| += | HB 372 | TELECONFERENCED | |
| + | HB 299 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 372-OMNIBUS INSURANCE
4:14:57 PM
CHAIR OLSON announced that the next order of business would be
HOUSE BILL NO. 372, "An Act relating to insurance; relating to
expenses for insurance examinations; relating to regulations for
insurance utilization review, benefits determination, health
care insurance grievance resolution procedures, independent
review of adverse determinations or final adverse
determinations, independent review organizations, and continuing
education providers; relating to required provisions for health
care insurance contracts and policies, including health care
provider choice; establishing civil penalties for insurers for
failure to provide requested records; amending the definition of
'wet marine and transportation' insurance; amending provisions
on limited licenses to include crop insurance; relating to
third-party administrator notification requirements; relating to
certification filing by reinsurance intermediary brokers;
relating to rate filings, delivery of insurance policies or
endorsements; relating to refunds of variable life insurance
policies and variable annuities; establishing limitations on
issuance of long- term care insurance; relating to requirements
for group health insurance policies; amending the definition of
'group health insurance'; relating to motor vehicle service
contracts; relating to notice requirements for meetings of
stockholders or members of a domestic insurer; establishing a
definition of 'bona fide association'; relating to requirements
and penalties for committing a fraudulent or criminal insurance
act; updating criteria for examinations; relating to rate filing
deviations; establishing civil penalties for certain wilful
violations; and providing for an effective date."
4:15:15 PM
REPRESENTATIVE HUGHES moved to adopt the committee substitute
(CS) for HB 372, Version 29-LS1379\H, Wallace, 3/30/16, as the
working document.
CHAIR OLSON objected for discussion purposes.
4:15:27 PM
LORI WING-HEIER, Director, Division of Insurance, Anchorage
Office, Department of Commerce, Community & Economic
Development, presented changes made by the CS for HB 372,
Version H, as follows:
· Beginning on page 3, Section 4 is amended by adding to the
title "relating to health care insurance policies" in order
to clarify that workers' compensation is not included in
the definition of health care insurance policies.
· Section 5 is deleted, affecting subsequent section numbers.
· Beginning on page 19, Section 31 is changed by adding the
words, "the specific" and "the exact change in" in
subsection (b). Sections 46 and 50 were deleted, and the
foregoing added to clarify that insurers give notice to the
consumer of 45 days after changes in the premium and form
filings are known.
· Beginning on page 7, Section 8 was Section 5, and now
applies to obstetrics/gynecology (OB/GYN) in order to avoid
federal preemption, and adds the words "a participating
health care professional who specializes in obstetrics or
gynecology shall agree to adhere to the health care
insurer's policies and procedures, including procedures
regarding referrals, obtaining prior authorization and
providing services under a treatment plan, if any, approved
by the health care insurer."
MS. WING-HEIER said the above are all the changes made by the CS
except for renumbering.
4:20:38 PM
REPRESENTATIVE JOSEPHSON asked for the reason to avoid federal
preemption.
MS. WING-HEIER explained that federal preemption threatens
state-based insurance regulations. In addition, state
compliance with the [Patient Protection and Affordable Care Act
of 2010 (PPACA)] aids in health care reforms, a possible waiver
or other provisions, in providing better and more affordable
insurance products for consumers, and in interaction with the
Centers for Medicare and Medicaid Services (CMS).
REPRESENTATIVE HUGHES asked whether the statement needed to
comply with federal law is specific to OB/GYN providers.
MS. WING-HEIER said yes. Previous iterations of the bill used
substantially similar language.
REPRESENTATIVE HUGHES questioned whether there has been a
reaction from OB/GYN providers in Alaska.
MS. WING-HEIER said providers were previously aware of the
provision. In further response to Representative Hughes, she
offered that the purpose of the provision directed at OB/GYN
providers was to provide transparency and avoid miscommunication
between the provider, consumer, and the insurer.
REPRESENTATIVE HUGHES restated her previous concern that the
insurer must not dictate a patient's care; she posed a situation
in which an insurer approved a treatment plan and the provider
deviated from the plan, and asked whether the insurer would pay
for the approved parts of the plan without penalty.
MS. WING-HEIER said the consumer always has the right to go out
of network for a different procedure, and the insurance company
retains the right to pay from the benefit plan; the provision
clarifies for the consumer what to expect "so there will not be
a surprise billing."
4:25:28 PM
REPRESENTATIVE HUGHES restated her concern that this provision
is a federal requirement.
REPRESENTATIVE LEDOUX confirmed that original Section 5 had been
deleted.
MS. WING-HEIER said correct.
REPRESENTATIVE JOSEPHSON surmised that subsection (h) is part of
the policy and values of PPACA to ensure that women's health
care is fundamental, and is "part and parcel of a general
package of, of primary care."
MS. WING-HEIER said she did not disagree in this regard, but
declined to explain the intent of PPACA.
4:27:27 PM
CHAIR OLSON opened public testimony on HB 372.
4:27:44 PM
JEANNIE MONK, Senior Program Officer, Alaska State Hospital and
Nursing Home Association (ASHNHA), informed the committee that
HB 372 is a complex bill, of which ASHNHA has not had sufficient
time to fully understand or vet. The stated intent of the bill
is to conform Alaska Statutes to federal law and to the National
Association of Insurance Commissioners (NAIC) standards;
however, which portions of the bill are based on what model is
unknown to ASHNHA. Ms. Monk expressed appreciation that Section
5 had been deleted. However, two areas of concern remain: 1.)
on page 8, lines 15-22, Section 11, the definition of emergency
medical condition does not include the prudent layperson
standard which is a standard in federal law that addresses the
need for insurance to cover a visit to an emergency room based
not on diagnosis, but on the possibility of serious illness, and
ASHNHA urged for the bill to confirm with the definition in
PPACA; 2.) on page 20, lines 15 and 20, Section 32, add the term
"or omits information" to the definition of a fraudulent
insurance act, and ASHNHA is concerned that adding this could
turn "any average bill submission into a fraudulent claim," and
seeks the deletion of "or omits information," or the addition of
"intentionally."
REPRESENTATIVE JOSEPHSON returned attention to Section 11, and
asked whether the present proposed definition of emergency
medical condition is too restrictive, and sets too high a
standard for a visit to the emergency room.
MS. MONK said yes. The prudent layperson standard is a lower
standard.
REPRESENTATIVE JOSEPHSON surmised ASHNHA seeks to protect
patient rights in Section 11.
MS. MONK said that's exactly right. In further response to
Representative Josephson, she said in Section 32, ASHNHA's
interest is to protect the person who submits an insurance bill,
which could be a patient or a provider.
REPRESENTATIVE HUGHES pointed out on page 20, line 8, Section
32, read:
(b) A fraudulent insurance act is committed by a
person who, with intent to injure, defraud, or deceive
REPRESENTATIVE HUGHES asked if ASHNHA considered that this
language addresses the concern of intent.
4:34:26 PM
MS. MONK offered to consult with others on this matter and
respond.
REPRESENTATIVE LEDOUX opined that the new language, "or omits
information" would lead to litigation on whether a claim should
be accepted.
MS. MONK agreed.
MS. WING-HEIER advised that part of addressing the cost of
health care is addressing fraud; in fact, any fraudulent act has
to have intent and cannot be a simple clerical error, a
misstatement, or a one-time occurrence. She said this is not
about insurance companies failing to pay claims, but about
someone who is committing fraud.
REPRESENTATIVE KITO asked how the division determines intent if
an insurance company makes an accusation of fraud.
MS. WING-HEIER explained the division would not look at one
claim or claimant, but the provider would have to file multiple
claims against an insurer and establish a pattern of fraud.
REPRESENTATIVE HUGHES suggested that the word "incomplete" found
on page 20, line 15, equates to "or omits information."
MS. WING-HEIER said no, incomplete information is missing
information. In further response to Representative Hughes, she
added that "incomplete information" could be a form that was
half completed, but "omits information" is withholding
information that has been requested.
4:40:00 PM
JON ZASADA, Policy Integration Director, Alaska Primary Care
Association (APCA), informed the committee APCA is the statewide
membership organization of Alaska's community health centers.
Because APCA members are safety-net health providers, his
organization's comments are focused on the potential impact of
the bill on its members. Mr. Zasada said APCA members
appreciate the deletion of Section 5. Returning attention to
page 20, Section 32, subsection (b), paragraphs (2) and (3), he
said APCA suggested adding the word "intentionally" in front of
"or omits information" after consulting with community health
associations in other states.
REPRESENTATIVE HUGHES questioned whether page 20, lines 8 and 9
take care of APCA's concern related to fraudulent intent.
MR. ZASADA said APCA seeks to add the word intentionally to make
the paragraphs "crystal clear."
REPRESENTATIVE JOSEPHSON returned attention to page 8, Section
11, and asked whether APCA agrees with ASHNHA's inclusion of the
prudent layperson standard in Section 11.
MR. ZASADA disclosed that APCA does not provide emergency
services, but does agree with ASHNHA.
4:43:56 PM
CHAIR OLSON, after ascertaining that no one further wished to
testify, closed public testimony.
[HB 372 was held over.]