2013 February Legislative Report

House and Senate Committees Kill Bills at Deadline for Approval

Hundreds of bills introduced in the House and Senate were killed on Friday when they were not approved before the close of business on February 22—the last day for passing bills out of committee in the house of origin.   

Having reached the first cut-off date, action now turns to the fiscal committees in the House and Senate which have until the close of business on Friday, March 1 to approve bills that that pose a fiscal impact for the state.  Following the cut-off for fiscal committees, all legislative activity will turn to the floors of the House and Senate.  The cut-off resolution calls for bills in the house of origin to be approved by Wednesday, March 13 at 5:00 p.m.  With rare exception, bills failing to be approved by the cut-off dates will not be considered further this session.    

House Committee Approves OIC Request Bill Intended to Allow Consideration of Financial Reserves when Non-Profit Health Plans Make Rate Filings

On a divided vote, the House Health & Wellness Committee has narrowly approved HB 1349—a bill that was introduced at the request of Insurance Commissioner Mike Kreidler to allow consideration of reserves and surplus when non-profit health carriers submit rate filings.  For the third year in a row, the controversial proposal was strongly opposed by health carriers, agent/broker groups, and the business community.   Although similar bills were introduced at the request of Insurance Commissioner Kreidler in 2011 and 2012, and the bill was not brought to a vote in committee last year.  Senator Randi Becker (R, 2^nd Legislative District), Chair of the Senate Health & Long Term Care Committee has indicated that she does not plan to consider the proposal in 2013.  Although the issue is likely dead in the Senate, Rep. Eileen Cody (D, 34^th Legislative District), the Chair of the House Health Care & Wellness Committee, made a decision to bring HB 1349 to a vote on the last day for committee action.  The bill was approved on a 9-7 vote that was entirely partisan, with no Democrats voting against the measure and no Republicans voting for it. 

Senate Committee Approves SB 5065—ACLI Proposal to Adopt Section 711 of the NAIC Insurance Receivership Model Act

The Senate Financial Institutions and Insurance Committee has approved SB 5065—a measure that would enact section 711 of the NAIC Insurance Receivership Model Act (IRMA), establishing a framework for recognizing netting agreements of qualified financial contracts between a life insurer and one or more counterparties.  The bill was requested by the American Council of Life Insurers.  The committee approved the measure on a vote of 6-1, and referred the bill to the Senate Ways and Means Committee for consideration.

When the bill was considered at hearing, Representatives from the American Council of Life Insurers and Symetra Financial testified in support of the bill—noting that this language has been enacted in at least 20 states and was adopted unanimously by the National Association of Insurance Commissioners as a Model Act.  A companion measure in the House—SHB 1033—has already been considered and approved by the House Business & Financial Services Committee.  The House measure was approved on a committee vote of 14-0.  The measure has been referred to the House Rules Committee in preparation for consideration on the House floor.

Senate Committee Kills Bill that Would Repeal Premium Tax Credit for Assessments Paid to the Washington Insurance Guaranty Association

The Senate Financial Institutions, Housing & Insurance Committee has killed SB 5168—a measure introduced by Senator Marilyn Chase (D, 32^nd Legislative District) that would have repealed the premium tax credit that insurers can take for assessments paid to the Washington Insurance Guaranty Association.  When the bill was considered during a hearing on Thursday, January 31, PCI and other industry representatives testified in opposition to the bill.  Committee Chairman Steve Hobbs (D, 44^th Legislative District) decided not to bring the measure to a vote after determining that it lacked sufficient support for passage.  There is no House version of the bill.  Although SB 5168 appears to be dead in committee, we will continue to monitor this and other tax threats that may appear as the legislature moves into negotiations on the 2013-2015 budget.  Bills that are necessary to implement the budget are exempt from the cut-off rules that apply to other measures.  Thus, we will continue to carefully watch for any adverse tax proposals that are targeted at the insurance industry.

 

Committee Approves Model Bill Dealing with Long Term Care Insurance Claims

On Thursday, February 21 the Senate Health Care Committee approved SB 5216—a measure that was introduced at the request of Insurance Commissioner Mike Kreidler.  The bill would establish standards for the handling of long term care insurance claims, and is consistent with the NAIC model on the issue.  The OIC has also indicated that any rules adopted on the issue will be consistent with NAIC model rules.  The American Council of Life Insurers testified in support of the measure. 

 

Senate Committee Approves Key Bill Dealing with Confidential Information—Kills Controversial Claims Data Bills

On Thursday, February 21 the Senate Health Care Committee approved SB 5434—a that was introduced at the request of health carriers, following extensive negotiations with the Insurance Commissioner regarding the confidential treatment of sensitive portions of provider contracts which the OIC requires to be filed.  The bill would exclude the proprietary reimbursement aspects of the contracts from being subject to public disclosure.  The OIC, together with AHIP, AWHP, and individual health carriers testified in support of the measure.  The Allied Daily Newspapers testified with concerns about protecting this information from public inspection.   

The Committee, however, killed a trio of other controversial claims data bills—SB 5265 (requiring billing transparency), SB 5537 (creating an all payor claims database), and SB 5538 (requiring the OIC and Dept. of Health to work with health carriers to address transparency of cost information and submit annual reports to the legislature).  AHIP and other carrier representatives expressed caution about the adverse effects of disclosing competitive pricing and reimbursement information among direct market competitors.  SB 5265, SB 5537 and SB 5538 were killed in committee when they were not brought to a vote before the deadline for action.

OIC Prepares Legislative Proposals

Insurance Commissioner Mike Kreidler has prepared a slim package of legislative proposals that he intends to submit to the 2013 Legislature.  His proposals can be found on the OIC’s website at http://www.insurance.wa.gov/laws-rules/legislation-rules/legislation/ .  Commissioner Kreidler’s proposals include an NAIC model bill addressing long term care insurance claims (SB 5216), a renewed effort to allow him to consider the surplus and reserves of non-profit health plans when reviewing rate filings (HB 1349), and a technical corrections bill. 

Legislature Adopts Cut-Off Resolution for the Consideration of Bills

On the first day of the 2013 session the legislature adopted a cut-off resolution establishing dates for the consideration of bills.  Key dates are as follows:

February 22—the last day for committees in the House of origin to take action on bills;

March 1—the last day for Fiscal committees in the House of origin to take action on bills;

March 13—the last day for the House of origin to take action on bills;

April 3—the last day for committees in the opposite House to take action on bills;

April 9—the last day for Fiscal committees in the opposite House to take action on bills;

April 17—the last day for the opposite House to take action on bills (except exempt bills and bills passed by both Houses in different forms);

April 28—the last day of the 2013 Regular Legislative Session

 

Melvin Sorensen

NAIFA-Washington Lobbyist