02/18/2016 01:30 PM Senate LABOR & COMMERCE

         SB 18-HEALTH CARE SHARE MINISTRY NOT INSURANCE                                                                     
                                                                                                                                
1:31:45 PM                                                                                                                    
VICE  CHAIR GIESSEL  announced the  consideration of  SB 18.  She                                                               
noted that the  bill was first heard 4/2/15  and public testimony                                                               
was closed.                                                                                                                     
                                                                                                                                
1:32:19 PM                                                                                                                    
JORDAN SHILLING, Staff, Senator  John Coghill, summarized that SB
 defines health  care sharing ministries and  exempts them from                                                               
insurance statutes. They are currently  not regulated because the                                                               
Division of Insurance does not view them as insurance.                                                                          
                                                                                                                                
VICE CHAIR GIESSEL questioned the need for the legislation.                                                                     
                                                                                                                                
MR.  SHILLING  replied  it  is   to  prevent  the  regulation  of                                                               
something that is not regarded  as insurance. It is a faith-based                                                               
community of individuals who have  agreed to share medical costs.                                                               
He noted that  the Affordable Healthcare Act  provides a specific                                                               
exemption from  the individual mandate  for existing  health care                                                               
sharing ministries.                                                                                                             
                                                                                                                                
1:33:52 PM                                                                                                                    
SENATOR STEVENS asked what services are provided.                                                                               
                                                                                                                                
MR.  SHILLING said  the medical  costs they  would cover  are the                                                               
same that  insurance would normally  cover. He noted  the packets                                                               
contain  a summary  of  what constitutes  a  health care  sharing                                                               
ministry.                                                                                                                       
                                                                                                                                
VICE CHAIR GIESSEL welcomed Senator Meyer to the committee.                                                                     
                                                                                                                                
She highlighted the distinguishing  characteristic is that health                                                               
care sharing ministries aren't actually  insurance so there is no                                                               
guarantee the medical costs will be covered.                                                                                    
                                                                                                                                
MR. SHILLING agreed; the participants  know up-front that this is                                                               
not insurance and there is no guarantee of payment.                                                                             
                                                                                                                                
VICE CHAIR GIESSEL added that there  is a pooling of resources to                                                               
share expenses as opposed to guaranteeing coverage.                                                                             
                                                                                                                                
MR. SHILLING agreed.                                                                                                            
                                                                                                                                
SENATOR  ELLIS asked  if there  is  any disclosure  or notice  to                                                               
participants that there is no guarantee of coverage.                                                                            
                                                                                                                                
1:35:51 PM                                                                                                                    
MR.   SHILLING  explained   that   the  disclosure   is  on   the                                                               
application.                                                                                                                    
                                                                                                                                
SENATOR  ELLIS  asked  what the  decision-making  process  is  to                                                               
determine what services are covered.                                                                                            
                                                                                                                                
MR. SHILLING  explained that when  a member needs health  care, a                                                               
letter  is sent  to all  the members  in the  pool outlining  the                                                               
specific  need  and  the  suggested  contribution.  Members  then                                                               
voluntarily  send in  their contribution.  He  didn't know  which                                                               
procedures are excluded under each health care sharing ministry.                                                                
                                                                                                                                
VICE CHAIR GIESSEL asked Ms.  Wing-Heier if the division supports                                                               
the legislation.                                                                                                                
                                                                                                                                
LORI WING-HEIER,  Director, Division of Insurance,  Department of                                                               
Commerce, Community  and Economic Development  (DCCED), explained                                                               
that  health  care  sharing ministries  that  were  in  existence                                                               
before 1999  were a carve-out  of the Affordable Care  Act (ACA).                                                               
They must  be a 501(c)(3),  members must share common  ethical or                                                               
religious beliefs,  they cannot  discriminate based on  the state                                                               
or  resident's  employment,  and   a  member  cannot  lose  their                                                               
membership if they develop a  medical condition. The organization                                                               
is subject to an annual  audit by an independent certified public                                                               
accountant (CPA).  Last year, health care  sharing ministries had                                                               
a  nationwide   membership  of  about   375,000  and   this  year                                                               
membership has grown to about 550,000.                                                                                          
                                                                                                                                
MS. WING-HEIER  said the only  potential concern, which  is based                                                               
on  social media,  is  that  people are  looking  to health  care                                                               
sharing ministries instead  of looking at the ACA.  If there were                                                               
complaints  or the  division thought  a  ministry was  soliciting                                                               
members outside  their religious  belief or ethics,  the attorney                                                               
general would  have the authority  to look at the  ministry under                                                               
trade practices provisions.                                                                                                     
                                                                                                                                
1:39:53 PM                                                                                                                    
SENATOR STEVENS asked how many  of these ministries are in Alaska                                                               
and their names.                                                                                                                
                                                                                                                                
MS. WING-HEIER  replied there  were just  under 4,000  members in                                                               
Alaska  last  year   and  the  main  ministries   in  Alaska  and                                                               
nationwide are Medi-Share and Samaritan Ministries.                                                                             
                                                                                                                                
SENATOR MEYER asked where the bulk of the ministries are located                                                                
                                                                                                                                
MS. WING-HEIER answered they're operating in all 50 states.                                                                     
                                                                                                                                
1:41:56 PM                                                                                                                    
SENATOR STEVENS moved to report  SB 18, labeled 29-LS0107\H, from                                                               
committee  with individual  recommendations  and attached  fiscal                                                               
note(s).                                                                                                                        
                                                                                                                                
VICE CHAIR  GIESSEL announced  that without  objection, SB  18 is                                                               
reported from the Senate Labor and Commerce Standing Committee.