NAIFA Washington Advisor: February 2013

Thursday, February 28, 2013

2013 February - IFAPAC

NAIFA WA was represented well in Olympia on January 29^th when dozens of members met there to discuss our business with legislators. On the same day, NAIFA WA was in Washington DC, on The Hill, doing the same thing. Richard Miller of NAIFA Central WA, Alex Collins of NAIFA Seattle/Eastside and Richard Ek of NAIFA Snohomish County met with staff working for five legislators in “The Other Washington.” We had spent the previous day in training with NAIFA leaders, lobbyists and other experts.

We met with the Chief of Staff for Representative Jim McDermott and legislative aides and directors for Representative Dave Reichert, Representative Susan DelBene, Senator Patty Murray and Senator Maria Cantwell. In every meeting we found the staff willing to listen to our message. Also, each office welcomes our contact with email updates on issues important to our clients (their constituents) and our industry. All indicated we were welcome to come back in April when NAIFA holds the Congressional Conference on the 8^th and 9^th. NAIFA expects to have close to 1,000 members for that event.

A few of the things we learned in the two days:

· Senators and Congressmen have an average of 13 meetings a day which means it is not easy to “see” them. Thus we meet with aides more often than not. Just the same, the elected officials rely heavily on the information gathered by their staff

· Ed Woods and his brother, Lawrence, met with President Wilson in 1913 and convinced him to amend the income tax legislation to give preferential tax treatment to the products we sell. We face the same challenges this year – it requires all NAIFA members to be involved by participating in the only political action committee that works for you every day; IFAPAC

· NAIFA CEO Susan Waters meets with HHS Secretary Kathleen Sebelius and other top leaders to tell our story

· Brad Fitch talked about “learning to hug a porcupine,” about our rights guaranteed in the First Amendment which forbids “the making of any law prohibiting the petitioning for a governmental redress of grievances.”

· In-person visits from constituents are 5 times more effective than lobbyist’s visits

· HB 2758 came about after a patient in his doctor’s office was presented with paperwork to complete while he was undressed (clothed in an examination gown). The patient lobbied his congressman who authored what became known as the “Stark Naked Act of 1997.”

· Advocates using Social Media can influence legislation – 64% of legislators say they follow Facebook posts so follow your legislator! 20-30 comments on a topic gets their attention. They also follow Twitter

· The first and second lines of a letter (or email) are the most important. Establish your credentials and state your “ask.”

· NAIFA’s goal for 2013 is to have 13,000 contributors which means we need to broaden our base in Washington to about 400 or double what we now have

· In the words of Terry Headley, past President of NAIFA, “We practice practical politics” which means we contribute to members of both parties

None of you reading this are ignorant of the economic problems facing our government. You are also aware that our industry (life insurance, annuities, qualified plans, employee benefits) are seen by many in Washington as a potential revenue source. If they can wipe away the preferential tax treatments currently in place they believe a large percentage of the current debt can be paid. It is frustrating that too many in Washington have no idea how important our products and services are to their constituents/our clients: Middle Americans.

What will YOU DO to join the other 197 IFAPAC participants in NAIFA WA? Will you sign up today? Will you add $10/month to help insure that your clients can continue to protect their families and businesses with life insurance? Will you help in the fight to retain the tax incentives that your clients enjoy when saving for retirement using life insurance, annuities and IRAs? Will you do what you can to help maintain the favorable tax treatment your clients have with their medical benefits?
We can’t say it enough – If Insurance Is Your Profession, Politics Is Your Business.

Richard Ek

IFAPAC Chairman

Monday, February 25, 2013

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

Wednesday, February 20, 2013

2013 February President's Message

Greetings NAIFA Participants! I am SO excited as I write this! We have a LOT of great things happening on the State level…because great things are happening at the local levels! My question is…Who is going to be Local of the Year this year? Who is going to be Agent/Member of the Year? How about Y.A.T. of the Year? I want you to make it really tough on me! Have pride in your local…and in your own individual service! We will find out the answer to these and many more questions at the 2013 State Convention in May!

For those of you who made it to the Day on the Hill, I am so proud of you all! We had record attendance, record participation and record profit! Don’t stop there! Continue to communicate with your legislators, continue to meet with them and build meaningful relationships with them…NO MATTER their politics! A super big shout out to Sharon Sparling for putting on a superb event! Also,a big thanks to Chris Free and NAHU for their attendance and participation!

Please be sure to block out May 15^th-17 on your calendars! Convention in the Sunshine this year!! Craig Foreman and the Tri-Cities local are busily preparing an incredible experience for our annual business meeting and sales conference (convention)! Please keep checking the web site as registration will begin soon! Here will be incredible “Top of the Table” speakers, more first time events, LILI Alumni Event and SO much more. Also, Local leadership…don’t forget that Thursday the 16^th will be your LSP (Leadership Success Planning). If there’s any one thing to invest in within the locals is the continuing leadership! Again…get used to checking the website for all events local & state! Radical Leadership – Radical Sacrifice!

There will be a LILI class this year and we only have three more openings, so please hurry and register so you can secure your spot. Contact Sharon Sparling at ssparling@jeffkyle.com and she can give you all the details! Again, investing in leadership is the responsibility of every local! Those of you who were at last year’s convention KNOW how fun and exciting it was! I promise that this year will be more, bigger, better than last year! Do NOT miss this one…or you WILL be sorry! I look forward to seeing each of you there!

Blessings,

Jeff

Tuesday, February 12, 2013

Take Part In Your Organization!

As you read this I know you are a paid NAIFA member and I appreciate you. Maintaining you membership in our fine professional organization is of the utmost importance, especially now with the financial state of the United States. Our voice as a Federation as well as each of us individually carries weight with our legislators. Please continue to or begin to contribute to IFAPAC as well. This is our lobbying arm that must be maintained and enhanced. As I’m sure is mentioned elsewhere we had a very successful Day On The Hill in Olympia January 29. Kudos to Mel Sorensen, Sharon Sparling and Drew Hooper for a job well done.

As your President Elect I would like to ask you to consider attending our state convention in Tri Cities May 15-17. Look for registration information soon. Be a part of the business of NAIFA as well as learning from the likes of Tom Hegna.

And I urge you to do two other things for the good of the organization and the industry. When you learn of a fellow NAIFA member leaving the organization talk him or her into staying, or get them back. If you need help just ask your leadership. And just as important please ask someone to be a NAIFA member. If each member brought in just one new member our number would double. I firmly believe each and every one of you has the ability to bring in a new member or more for that matter.

This brings me to a recent experience and notice. Today I met with Gerry Moody of State Farm in Puyallup. Gerry has been with State Farm for nearly 31 years and has a very successful business with a few thousand households he serves. He became a new NAIFA member today – thank you Gerry. He is an LUTCF, CLU and ChFC. He needs and wants help with providing more service to his clients in the life and disability area to include long term care and annuities as well. He wants to bring into his practice an experienced life agent to work his book of business. If I wasn’t so happy where I am I would be interested – lots of opportunity! If you know of someone interested have them call Gerry at 253 841-3746.

Go and serve your clients well.

Kevin Gleim

President Elect

2013-03 Legislative Report

House Committee Considers Measure
Establishing a Single Payer Health Plan

On Friday, February 1 the House Health Care and Wellness Committee held a hearing to consider HB 1085—a measure introduced by Rep. Sherry Appleton (D, 23^rd Legislative District) which would establish a single payer health plan—the “Washington Health Security Trust” to provide coverage to all residents of the State of Washington. NAIFA, WAHU, business groups, and health carriers noted their opposition to the measure, but proponents greatly outnumbered opponents as the bill was considered. The bill would abolish the Washington Health Care Authority, and require all Washington employers to pay an assessment to the Department of Revenue to fund the Washington Health Security Trust. The bill would also require the submission of an application to the Federal Government to allow for a waiver from the Affordable Care Act and abolishing the Health Benefits Exchange. A fiscal note for the measure estimates expenditures at over $770 million by the 2017-’19 biennium, but there are many unknown aspects of the prospective costs because HB 1085 relies upon a variety of federal waivers which may or may not be granted. Even if the House Health Care & Wellness Committee chooses to move the bill, it is very unlikely that the measure will be seriously considered by the House Appropriations Committee.

Senate Committee Considers SB 5065—

ACLI Proposal to Adopt Section 711

of the NAIC Insurance Receivership Model Act

The Senate Financial Institutions and Insurance Committee held a hearing on Thursday, January 31, to consider 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.

At the Senate 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. Symetra commented that the language is necessary to provide a competitive regulatory structure for Washington-domiciled life insurers who compete in the same market space with life insurers who are domiciled in states that have already adopted the language. In a surprising development, Senator Marilyn Chase (D, 32^nd Legislative District) and one of her constituents—Brian McCullough (a former candidate for Insurance Commissioner)—testified in opposition to the bill. It does not appear that their testimony damaged the bill. The measure is scheduled for a vote on Thursday, February 7. 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.