Thursday, February 5, 2015

2015 January/February Legislation

Legislative Report
 
OIC Request Legislation Modernizing Life Insurance Reserve Requirements Moves Forward in the Senate and House
 
On Wednesday, January 21 the Senate Financial Institutions & Insurance Committee Friday, held a hearing to consider SB 5180—a measure introduced at the request of Insurance Commissioner Mike Kreidler to adopt the NAIC updates to the Standard Valuation and Standard Nonforfeiture laws, including a new approach based on principle-based reserves. The American Council of Life Insurers, Allstate, American Family Insurance, and USAA testified in support of the bill. The OIC also spoke in favor of the bill. The committee took action and approved a “do pass” recommendation on the bill on Friday, January 23. The bill has been referred to the Senate Rules Committee in preparation for consideration on the Senate floor.
 
A House version of the bill (HB 1076) was approved by the House Business and Financial Services Committee on January 20. HB 1076 has been referred to the House General Government & Information Technology Committee for consideration of the fiscal note on the measure that has been prepared by the OIC. The committee has scheduled a hearing on the measure for Tuesday, February 3. This is a routine referral for review of the fiscal note, and is not expected to significantly delay the progress of the bill. The bill has already been placed on a list of bills to be brought to a vote.
 

House Fiscal Committee to Consider OIC Proposal to Adopt NAIC Revisions to NAIC Model Insurer Holding Company Act
 
The House General Government & Information Technology Committee has scheduled a hearing on Tuesday, February 3 to consider HB 1065— Insurance Commissioner Mike Kreidler’s proposal to adopt the new NAIC revisions to the Model Insurance Holding Company Act. The bill has already been considered and approved by the House Business and Financial Services Committee, and the bill appears to be moving forward in a routine manner. During the hearing in the Business and Financial Services Committee, the ACLI, together with PCI, America’s Health Insurance Plans and other industry trade associations and stakeholders testified in support of the bill.
 
The revisions are a standard for maintaining NAIC accreditation, and they must be enacted by the close of 2015. The bill has been discussed within an informal OIC stakeholder work group for at least two years. The House General Government & Information Technology Committee has already scheduled a vote for the bill, so it is expected to move forward without controversy. Review of the fiscal note is routine, and no controversies or significant delays are anticipated.
 
On Friday, January 30 a Senate version of the bill (SB 5717) was introduced by Senator Jan Angel (R, 26th District). It is expected that the bill will be scheduled for hearing in coming days.
 
House Committee Considers Electronic Insurance Transactions Bill—Senate Committee to Consider Senate Version in Coming Days
 
The House Business & Financial Services Committee held a hearing on Wednesday, January 28 to consider HB 1329—a measure closely modeled after the Federal Uniform Electronic Transaction Act that would specifically authorize insurers to conduct business with policyholders over the internet, subject to the consent of each policyholder. The proposal also includes a section that would allow an insurer to post generic policy forms and endorsements on a publicly-available website in lieu of mailing paper documents to policyholders, subject to the consent of each policyholder.
 
At the hearing PCI, Allstate, American Family Insurance, the American Council of Life Insurers, and Progressive Insurance testified in support of the bill. Also testifying in support of the bill, but noting that some additional adjustments will be necessary, were the Office of the Insurance Commissioner and the agent groups. The issues raised by the OIC appear to be easily resolved. Work continues with respect to language that has been negotiated between the PCI and agent groups at the national level.
 
The bill was introduced by Representative Derek Stanford at the request of the Property Casualty Insurers Association of America. The proposal has been enacted in over two dozen states. A Senate version of the measure (SB 5471) was introduced by Senator Jan Angel (R, 26th District) On Thursday, January 22. Senate Financial Institutions & Insurance Committee has scheduled a hearing for SB 5471 on Thursday, February 5.
 
On Friday, January 23 Rep. Steve Kirby (D, 29th District) introduced HB 1578—a measure that would authorize insurers to offer “customer satisfaction” benefits. The measure would allow insurers to provide a premium credit or other financial benefit to a policyholder who is dissatisfied with the service provided by the insurer. The bill was introduced at the request of Allstate to provide specific statutory authority for filings that might be submitted to the OIC regarding such benefits. The bill is likely to be scheduled for a hearing next week.
 

House Committee Considers New “All Payer Claims Database” Bill Introduced at the Request of Governor Inslee
 
On Friday, January 30 the House Health Care Committee held a hearing to consider HB 1437—a bill that was requested by Governor Inslee to provide for adjustments to the statewide all-payer claims database that was established in 2014 regarding the reporting of data, pricing of products, and parameters for the release of information. The bill attracted supportive testimony from business groups, health plans, provider groups, and others. A slightly different version of the bill (SB 5084) was introduced in the Senate last week by Senator Randi Becker (R, 2nd District). Although the bills vary slightly, both HB 1437 and SB 5084 have been heavily negotiated by health plans and other stakeholders, and show evidence of agreement among many groups. SB 5084 has not yet been scheduled for a hearing.
 
Senate Committee Schedules Hearing to Consider Bill to Prohibit the Health Benefits Exchange from Premium Aggregation
 
The Senate Health Care Committee has scheduled a hearing to consider SB 5142—a measure that would prohibit the Health Benefit Exchange from aggregating or delegating the aggregation of funds that comprise the premium for an individual qualified health plan. The bill is scheduled to be heard on Monday, January 26. The bill was introduced following related action by the Health Exchange Board to cease premium aggregation, but some legislators have expressed concern that the Board might revisit the issue. SB 5142 would remove the Board’s authority to aggregate premium. Rep. Richard DeBolt (R, 20th District) has introduced HB 1628 in the House—an identical measure to SB 5142. HB 1628 has not yet been scheduled for hearing.
 
House Committtee to Consider Controversial Bill Regarding Preauthorizations and Cost-Sharing
 
The House Health Care & Wellness Committee has scheduled a hearing to consider HB 1471—a measure that would impose controversial new requirements and restrictions regarding health plans’ activities associated with preauthorizations, cost-sharing requirements, and other practices. A Senate version of the bill has been introduced (SB 5560) but the measure has not been scheduled for hearing, and it appears that the Senate may wait to see what the House chooses to do with its version of the measure. The bills have been introduced at the request of the Washington State Chiropractic Association and other provider groups.
 
Senate and House Committees Approve Bills Introduced to Standardize Filings in Large Group, Stand-Alone Dental, and Stand-Alone Vision Markets
 
Both the Senate and House Health Care Committees have taken action to approve companion bills that would standardize the filing requirements for disability insurers in the large group, standalone dental, and standalone vision markets. HB 1053 and SB 5023 were introduced by key members in the House and Senate at the request of Cigna. The bills are intended to allow disability insurers to benefit from the same regulatory provisions for filings in these markets that are currently available to health care service contractors and HMO’s. SB 5023 was considered by the Senate Health Care Committee on Thursday, January 22. On Friday, January 23 the House Health Care Committee held a hearing to consider the House version of the bill—HB 1053. At both hearings Cigna, the Office of the Insurance Commissioner, and the Washington Association of Healthcare Plans testified in support of the bill. Other disability insurers and health care service contractors signed in to indicate support for the measures. The issues have been negotiated to resolution with the OIC.
 
 
SB 5023 was approved by the Senate Health Care Committee on Thursday, January 29, and HB 1053 was approved by the House Health Care & Wellness Committee on Friday, January 30. Both bills have been referred to the respective Senate and House Rules Committees in preparation for being pulled to the Senate and House floor calendars for consideration.
 
 
OIC Prepares Legislative Proposals
 
Insurance Commissioner Mike Kreidler has prepared a series of legislative proposals that he intends to submit to the 2015 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 the revisions to the NAIC model Holding Company Act, the Standard Valuation and Nonforfeiture Model Act, the Own Risk Solvency Assessment Act, the Credit for Reinsurance Model Act, and a proposal that deals with long term care insurance bills addressing independent review organizations involved in disputes associated with long term care insurance claims.
 
Legislature Adopts Cut-Off Resolution for the Consideration of Bills
 
On the first day of the 2015 session the Senate adopted SCR 8400—a cut-off resolution establishing dates for the consideration of bills. The House approved the measure on Tuesday, January 20. Key dates are as follows:
 
February 20—the last day for committees in the House of origin to take action on bills;
 
February 27—the last day for Fiscal committees in the House of origin to take action on bills;
 
March 11—the last day for the House of origin to take action on bills;
 
April 1—the last day for committees in the opposite House to take action on bills;
 
April 7—the last day for Fiscal committees in the opposite House to take action on bills;
 
April 15—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 26—the last day of the 2015 Regular Legislative Session
 
 
Respectfully,
Melvin N. Sorensen
Lobbyist NAIFA-Washington






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