2008 Legislation
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SENATE BILL NO. 1395<br /> – Individual high-risk insurance pool


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Bill Status

S1395.......................................by COMMERCE AND HUMAN RESOURCES
INSURANCE - Amends existing law relating to the Idaho Individual High Risk
Reinsurance Pool to revise definitions; to provide for coverage for certain
eligible persons; and to provide for exceptions.

02/08    Senate intro - 1st rdg - to printing
02/11    Rpt prt - to Com/HuRes
02/13    Rpt out - rec d/p - to 2nd rdg
02/14    2nd rdg - to 3rd rdg
02/21    3rd rdg - PASSED - 34-0-1
      AYES -- Andreason, Bair, Bastian, Bilyeu, Broadsword, Cameron,
      Coiner, Corder, Darrington, Davis, Fulcher, Gannon, Geddes, Goedde,
      Hammond, Heinrich, Hill, Jorgenson, Kelly, Keough, Langhorst, Little,
      Lodge, Malepeai(Sagness), McGee, McKague, McKenzie, Pearce,
      Richardson, Schroeder, Siddoway, Stegner, Stennett, Werk
      NAYS -- None
      Absent and excused -- Burkett
    Floor Sponsor - Cameron
    Title apvd - to House
02/22    House intro - 1st rdg - to Bus
03/14    Rpt out - rec d/p - to 2nd rdg
03/17    2nd rdg - to 3rd rdg
03/19    3rd rdg - PASSED - 67-0-3
      AYES -- Anderson, Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black,
      Block, Bock, Boe, Bolz, Bowers, Brackett, Bradford, Chadderdon,
      Chavez, Chew, Clark, Collins, Crane, Durst, Eskridge, Hagedorn, Hart,
      Harwood, Henbest, Henderson, Jaquet, Killen, King, Kren, Labrador,
      Lake, LeFavour, Loertscher, Luker, Marriott, Mathews, McGeachin,
      Mortimer, Moyle, Nielsen, Pasley-Stuart, Patrick, Pence, Raybould,
      Ringo, Ruchti, Rusche, Sayler, Schaefer, Shepherd(02), Shepherd(08),
      Shirley, Shively, Smith(30), Smith(24), Snodgrass, Stevenson, Thayn,
      Thomas, Vander Woude, Wills, Wood(27), Wood(35), Mr. Speaker
      NAYS -- None
      Absent and excused -- Nonini, Roberts, Trail
    Floor Sponsor - Collins
    Title apvd - to Senate
03/20    To enrol - Rpt enrol - Pres signed
03/21    Sp signed
03/24    To Governor
03/28    Governor signed
         Session Law Chapter 297
         Effective: 07/01/08

Bill Text

  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   Second Regular Session - 2008


                                       IN THE SENATE

                                    SENATE BILL NO. 1395


  1                                        AN ACT

  6    Be It Enacted by the Legislature of the State of Idaho:

  7        SECTION  1.  That  Section 41-5501, Idaho Code, be, and the same is hereby
  8    amended to read as follows:

  9        41-5501.  DEFINITIONS. As used in this chapter:
 10        (1)  "Agent" means a producer as  defined  in  section  41-1003(8),  Idaho
 11    Code.
 12        (2)  "Board"  means the board of directors of the Idaho high risk individ-
 13    ual reinsurance pool established in this chapter and the Idaho small  employer
 14    reinsurance program established in section 41-4711, Idaho Code.
 15        (3)  "Carrier"  means  any  entity that provides, or is authorized to pro-
 16    vide, health insurance in this state. For purposes of  this  chapter,  carrier
 17    includes  an insurance company, any other entity providing reinsurance includ-
 18    ing excess or stop loss coverage, a hospital or professional service  corpora-
 19    tion,  a  fraternal  benefit  society, a managed care organization, any entity
 20    providing health insurance coverage or benefits to residents of this state  as
 21    certificate  holders  under a group policy issued or delivered outside of this
 22    state, and any other entity providing a plan of  health  insurance  or  health
 23    benefits subject to state insurance regulation.
 24        (4)  "Dependent"  means  a  spouse,  an  unmarried  child under the age of
 25    twenty-one (21) years, an unmarried child who is a full-time student under the
 26    age of twenty-five (25) years and who is financially dependent upon  the  par-
 27    ent,  and an unmarried child of any age who is medically certified as disabled
 28    and dependent upon the parent.
 29        (5)  "Director" means the director of the department of insurance  of  the
 30    state of Idaho.
 31        (6)  "Eligible individual" means:
 32        (a)  An Idaho resident individual or dependent of an Idaho resident who is
 33        under the age of sixty-five (65) years, is not eligible for coverage under
 34        a  group  health plan, part A or part B of title XVIII of the social secu-
 35        rity act (medicare), or a state plan under title  XIX  (medicaid)  or  any
 36        successor  program, and who does not have other health insurance coverage;
 37        or
 38        (b)  An individual who is legally domiciled in Idaho on the date of appli-
 39        cation to the pool and is eligible for the  credit  for  health  insurance
 40        costs under section 35 of the Internal Revenue Code of 1986; or
 41        (c)  An  Idaho resident individual or a dependent of an Idaho resident who
 42        is a federally eligible individual (one who meets the eligibility criteria
 43        set forth in the federal health insurance portability  and  accountability


  1        act of 1996 Public Law 104-191, Sec. 2741(b) (HIPAA)).
  2    Coverage  under a basic, standard, catastrophic A, catastrophic B, or HSA com-
  3    patible health benefit plan shall not be available to any  individual  who  is
  4    covered  under  other health insurance coverage, except as provided in section
  5    41-5510(4), Idaho Code. For purposes of this chapter, to be eligible, an indi-
  6    vidual must also meet the requirements of section 41-5510, Idaho Code.
  7        (7)  "Health benefit plan" means any hospital or medical policy or certif-
  8    icate, any subscriber contract provided by a hospital or professional  service
  9    corporation,  or  health  maintenance organization subscriber contract. Health
 10    benefit plan does not include policies or certificates of insurance  for  spe-
 11    cific  disease, hospital confinement indemnity, accident-only, credit, dental,
 12    vision, medicare supplement, long-term care, or disability  income  insurance,
 13    student  health  benefits  only,  coverage issued as a supplement to liability
 14    insurance, worker's compensation or similar insurance, automobile medical pay-
 15    ment insurance, or nonrenewable short-term coverage issued  for  a  period  of
 16    twelve (12) months or less.
 17        (8)  "Individual basic health benefit plan" means a lower cost health ben-
 18    efit plan developed pursuant to section 41-5511, Idaho Code.
 19        (9)  "Individual carrier" means a carrier that offers health benefit plans
 20    covering eligible individuals and their dependents.
 21        (10) "Individual  catastrophic A health benefit plan" means a higher limit
 22    health benefit plan developed pursuant to section 41-5511, Idaho Code.
 23        (11) "Individual catastrophic B health benefit plan" means a health  bene-
 24    fit  plan  offering  limits  higher  than a catastrophic A health benefit plan
 25    developed pursuant to section 41-5511, Idaho Code.
 26        (12) "Individual HSA compatible health benefit plan" means a  health  sav-
 27    ings  account  compatible  health  benefit  plan developed pursuant to section
 28    41-5511, Idaho Code.
 29        (13) "Individual standard health benefit plan" means a health benefit plan
 30    developed pursuant to section 41-5511, Idaho Code.
 31        (14) "Plan" or "pool plan" means the  individual  basic,  standard,  cata-
 32    strophic  A, catastrophic B, or HSA compatible health benefit plan established
 33    pursuant to section 41-5511, Idaho Code.
 34        (15) "Plan of operation" means the plan of  operation  of  the  individual
 35    high risk reinsurance pool established pursuant to this chapter.
 36        (16) "Pool" means the Idaho high risk reinsurance pool.
 37        (17) "Premium" means all moneys paid by an individual and eligible depend-
 38    ents  as  a condition of receiving coverage from a carrier, including any fees
 39    or other contributions associated with the health benefit plan.
 40        (18) "Qualifying previous coverage"  and  "qualifying  existing  coverage"
 41    mean benefits or coverage provided under:
 42        (a)  Medicare  or  medicaid,  civilian  health  and  medical  program  for
 43        uniformed  services  (CHAMPUS), the Indian health service program, a state
 44        health benefit risk pool, or any other similar publicly sponsored program;
 45        or
 46        (b)  Any group or individual health insurance  policy  or  health  benefit
 47        arrangement  whether or not subject to the state insurance laws, including
 48        coverage provided by a managed care organization or  a  fraternal  benefit
 49        society.
 50        (19) "Reinsurance  premium" means the premium set by the board pursuant to
 51    section 41-5506, Idaho Code, to be paid by  a  reinsuring  carrier  for  plans
 52    issued under the pool.
 53        (20) "Reinsuring  carrier" means a carrier participating in the individual
 54    high risk reinsurance pool established by this chapter.
 55        (21) "Restricted network provision" means any provision of a health  bene-


  1    fit  plan that conditions the payment of benefits, in whole or in part, on the
  2    use of health care providers that have entered into a contractual  arrangement
  3    with the carrier to provide health care services to covered individuals.

  4        SECTION  2.  That  Section 41-5510, Idaho Code, be, and the same is hereby
  5    amended to read as follows:

  6        41-5510.  ELIGIBILITY. (1) Any eligible individual eligible person, who is
  7    and continues to be a resident shall be eligible for coverage under  an  indi-
  8    vidual  basic,  standard,  catastrophic  A, catastrophic B, and HSA compatible
  9    health benefit plan if evidence is provided that:
 10        (a)  Such person has been rejected by one (1) individual  carrier  on  the
 11        basis of health status or claims experience; or
 12        (b)  An  individual carrier refuses to issue a health benefit plan provid-
 13        ing coverage substantially similar to coverage offered under an equivalent
 14        pool plan except at a rate exceeding the rate for the pool plan; or
 15        (c)  Such person is a federally eligible individual; or
 16        (d)  Such person is legally domiciled in Idaho on the date of  application
 17        to  the  pool  and  is  eligible for the credit for health insurance costs
 18        under section 35 of the Internal Revenue Code of  1986.  In  addition,  if
 19        such  person maintained creditable health insurance coverage for an aggre-
 20        gate period of three (3) months as of the date  on  which  the  individual
 21        seeks  to  enroll  in  pool  coverage,  not counting any period prior to a
 22        sixty-three (63) day break in coverage:
 23             (i)   The preexisting  condition  limitation  set  forth  in  section
 24             41-5208, Idaho Code, shall not apply; and
 25             (ii)  The  requirement for exhaustion of any available coverage under
 26             title X of the consolidated  omnibus  budget  reconciliation  act  of
 27             1986,  public  law  99-272  (COBRA) or state continuation benefits is
 28             waived.
 29        (2)  A rejection or refusal by a carrier offering only stop  loss,  excess
 30    of  loss or reinsurance coverage with respect to an applicant under subsection
 31    (1) of this section shall not constitute sufficient evidence for  purposes  of
 32    subsection (1) of this section.
 33        (3)  Each  resident  dependent  of  a  person who is eligible for coverage
 34    under the pool shall also be eligible for coverage under the pool.
 35        (4)  Any eligible individual person meeting the  eligibility  requirements
 36    of  subsection  (1), (2) or (3) of this section shall be eligible for coverage
 37    under a pool plan even though the person has  existing  coverage  under  other
 38    health insurance or under a group health plan provided: (a) there is a reason-
 39    able  probability  that  the lifetime benefit maximum of the existing coverage
 40    will be exceeded within ninety (90) days; and (b) the lifetime benefit maximum
 41    under the  existing  coverage  is  at  least  five  hundred  thousand  dollars
 42    ($500,000).  In  all  cases,  coverage  under  a pool plan is secondary to the
 43    existing coverage and all other insurance.
 44        (5)  A person shall not be eligible for coverage under a pool plan if:
 45        (a)  The person is not a federally eligible individual and, except as pro-
 46        vided otherwise in subsection (4) of this section, has or  obtains  health
 47        insurance  coverage  substantially similar to or more comprehensive than a
 48        pool plan, or would be eligible to  have  such  coverage  at  a  rate  not
 49        exceeding the rate for the pool plan if the person elected to obtain it;
 50        (b)  The  person  is  determined  to  be eligible for health care benefits
 51        under medicaid;
 52        (c)  The person has previously terminated pool plan coverage unless twelve
 53        (12) months have lapsed since such  termination;  provided  however,  that


  1        this  provision shall not apply with respect to an applicant who is a fed-
  2        erally eligible individual;
  3        (d)  The person is an inmate or resident of a state or other public insti-
  4        tution, or a state, local or private correctional facility; provided  how-
  5        ever, that this provision shall not apply with respect to an applicant who
  6        is a federally eligible individual.
  7        (56)  Notwithstanding any other provision of this chapter, eligibility for
  8    continuation  of coverage under COBRA shall not render a person ineligible for
  9    coverage under a pool plan.
 10        (67)  Coverage shall cease:
 11        (a)  On the first day of the month following  the  date  a  person  is  no
 12        longer a resident of this state;
 13        (b)  On  the  first  day of the month following the date a person requests
 14        coverage to end;
 15        (c)  Upon the death of the covered person;
 16        (d)  At the option of the board, thirty (30) days after the plan makes any
 17        inquiry concerning the person's eligibility or place of residence to which
 18        the person does not reply.
 19        (78)  A person who ceases to meet the  eligibility  requirements  of  this
 20    section  may  be  terminated  on the first day of the month following the date
 21    when the individual becomes ineligible.

Statement of Purpose / Fiscal Impact

                      STATEMENT OF PURPOSE

                            RS 17805
     In 2000, the Idaho Legislature created the Idaho High Risk
Pool.  The purpose of the High Risk Pool was to provide every
Idahoan who has serious health conditions an opportunity to
purchase insurance through a reinsurance mechanism.  As part of
the original bill, we prohibited individuals who currently had
insurance from applying to the High Risk Pool.  There are good
reasons for that public policy decision.

     However, an inadvertent result is that individuals who reach
their lifetime maximum cannot apply to the High Risk Pool until
their coverage is terminated.  This causes the person to go
through a period of being uninsured, while building up large
dollars of claims.  County indigent funds and property taxes are
affected as well as the State's Catastrophic Health Care Fund,
not to mention the health and well being of the individual.

     This bill attempts to remedy that situation by allowing an
individual who would otherwise qualify for the High Risk Pool to
apply for coverage if there is reasonable probability that they
will exceed their lifetime maximum within 90 days.

                         FISCAL IMPACT

     None to the General Fund, except a potential savings in the
Catastrophic Health Care Fund.  The High Risk Pool may be
adversely impacted by large claims; however, we expect that to be
minimal.  The Fund is actuarially financially stable.  


Name:   Senator Dean Cameron 
Phone:  334-4735
Name:   Representative Gary Collins,  Phone:  332-1063        
        Hyatt Erstad, Chairman, Idaho High Risk Pool Board
        Phone: 343-8899
        Bill Deal, Director, Idaho Department of Insurance
        Phone:  334-4250

STATEMENT OF PURPOSE/FISCAL NOTE                             S 1395