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State Legislative Update

May 26 - May 27, 2000

		Government Affairs Newsletters Washington Updates Hey, Wait A Minute State Legislative Updates Through the Grapevine

Antitrust

Senator Hannon’s antitrust bill, New York S.B. 7541, passed the Senate Finance committee on May 15, 2000. This measure, which is known as the "New York State Managed Care Freedom of Choice Act of 2000," would authorize health care providers to engage in collective negotiations with health benefit plans under specified conditions. Such negotiations could extend to fee-based contract provisions if certain conditions were met to determine that the health benefit plan has significant market power.

Representative Trakas, of Ohio, introduced H.C.R. 65 on May 2, 2000, and this measure requests that the U.S. Congress enact H.R. 1304, which would establish a federal antitrust waiver for physicians. On May 16, 2000, the House Committee on Commerce and Labor held a second hearing concerning this resolution.

Children’s Health Insurance Program (CHIP)

Action was taken in two states—Mississippi and New York. In Mississippi, the Governor signed H.B. 1469 on May 23, 2000. This new law will revise eligibility criteria under the CHIP to provide that a person who is without insurance coverage at the time of application for the program, and who meets other eligibility criteria, will be eligible to receive covered benefits under the program subject to federal approval.

In New York, A.B. 10938 was assigned to the Assembly Committee on Rules on May 23, 2000. This bill would prohibit approved organizations providing coverage under the CHIP from discriminating against healthcare providers that do not participate in the organization’s healthcare network.

New York S.B. 7523 was introduced on April 17, 2000 to the Senate Committee on Health. On May 23, 2000 the bill was amended on the Senate floor. This measure would include coverage of prehospital emergency medical services when provided by members of an ambulance service under CHIP.

Genetic Discrimination

Action was taken on genetics bills in California, New Hampshire and New York. California A.B. 2797 passed the Assembly Committee on Appropriations on May 17, 2000, and it was read on the Assembly floor for the second time on May 22, 2000. This bill, which was introduced by Assembly Member Papan, would prohibit people who sell or underwrite insurance coverage from disclosing individually identifiable information concerning the health, medical or genetic history of a customer.

Also in California, S.B. 1364, sponsored by Senator Johnston, was assigned to the Senate Health Committee on May 15, 2000. This bill would amend the state’s existing Confidentiality of Medical Information Act by specifying that the definition of the term "genetic characteristic" is the same as the definition contained in existing provisions that apply to health care service plans.

In New Hampshire, legislation introduced by Representative Kurk passed the Senate on May 18, 2000 and was sent back to the House for concurrence. This bill would prohibit the use of genetic testing when underwriting specified types of long-term care and disability insurance policies.

In New York, the Assembly Rules Committee passed A.B. 3425 on May 15, 2000. This bill, which was sponsored by Assembly Member Morelle, would prohibit life and disability carriers from denying or canceling coverage based on the genetic information of an enrollee or an enrollee’s family member. Carriers would also be prohibiting from requesting genetic information from an enrollee or an enrollee’s family member.

New York A.B. 7186 passed the Assembly and was assigned to the Senate Rules Committee on May 15, 2000. Assembly Member Sweeney’s bill would prohibit group health insurers from discriminating against prospective enrollees based on any predisposing genetic characteristics the enrollee may have.

Health Insurance Tax Incentives

In California, A.B. 2200, sponsored by Assembly Member Pacheco, was rereferred to the Assembly Committee on Appropriations on May 22, 2000. This measure would create an income tax deduction equal to 100 percent of medical expenses that cost more than $1000. To qualify, an individual must be 65 years of age or older and have an income less than $50,000. Married couples must have a joint income of less than $100,000.

Health Plan Liability

In Alaska, H.B. 211, sponsored by Representative Rokeberg, was sent to the Governor on May 18, 2000. This measure would establish the civil liability of managed care entities that do not exercise ordinary care when making treatment decisions. Also included in this measure is a requirement that a health plan contract would need to clearly identify all healthcare services that the plan provides and covers, as well as the plan’s utilization and external review process.

On May 18, 2000, two similar bills were introduced in North Carolina, H.B. 1589 and S.B. 1326, sponsored by Representative Hackney and Senator Wellons respectively. Both bills would establish the liability of health benefit plans for damages for harm to enrollees caused by the failure of the plan to exercise ordinary care. Liability could not be extended to employers that offer health plan benefits to employees unless the employer makes healthcare treatment decisions. The enrollee would be required to complete all internal and external appeals before filing a claim of liability.

Long-Term Care

Action was taken on long-term care legislation in seven states—Alabama, California, Maryland, Michigan, New York, Pennsylvania and Vermont. In Alabama, H.B. 170 was sent to the Governor for signature on May 15, 2000. This legislation, which was sponsored by Representative Newton, is known as the Long-Term Care Insurance Policy Minimum Standards Act. It would establish that long-term care insurance policies are to be regulated by the state Commissioner of Insurance.

California A.B. 2281, a 100 percent long-term care tax deduction bill, was read for a second time on the Assembly floor and amended on May 22, 2000. A.B. 2281 covers long-term care insurance purchased by a taxpayer for either the taxpayer, his/her spouse and/or any dependents.

California S.B. 2111 passed the Senate Appropriations Committee as amended on May 15, 2000. On May 23, 2000 this legislation was read for a third time on the Senate floor and approved as amended. This bill, which was introduced by Senator Dunn, would amend existing law about the consumer long-term care guide to include sections on rate histories and policy comparisons. In addition, the long-term care personal worksheets used by agents must include a reference to the rate guide with information on where copies may be obtained.

In Maryland, the Governor signed Senator Hollinger’s bill, S.B. 171, on May 11, 2000. This measure will give individuals a state income tax credit equal to 100 percent of qualified long-term care insurance premiums paid during the year by the taxpayer to insure the individual or the individual’s spouse, parent, step-parent, child or step-child. The tax credit outlined in S.B. 171 can only be used for one taxable year. S.B. 171 will also require the state Comptroller to submit a report concerning the impact and cost-savings of this credit.

Michigan H.B. 4313 would require that all long-term care insurance policies include a definition of home health care and/or assisted living facilities. This bill passed the House on May 18, 2000 and was sent to the Senate.

In New York, A.B. 11006 became law on May 15, 2000. This measure establishes a 10 percent individual tax credit for premiums paid during the taxable year for long-term care insurance. In order to qualify for such a credit, the taxpayer's premium payment must be for the purchase of a long-term care insurance policy approved by the state Superintendent of Insurance.

Pennsylvania H.B. 2546 was introduced on May 11, 2000 by Representative Browne and assigned to the House Committee on Insurance. This legislation would establish that long-term care insurance policies provide, as an optional benefit, coverage that would permit married couples who have a long-term care policy covering both individuals to assign a portion of unused coverage by one spouse to the other.

The Governor of Vermont signed H.B. 683 into law on May 12, 2000. This legislation will, among other things, require the state Commissioner on Aging and Disabilities to report to the General Assembly on the feasibility of creating a long-term care partnership program in the state. A partnership program would link the purchase of certain long-term care insurance policies to special Medicaid eligibility standards.

Managed Care Reform/ Patient Protection

On May 22, 2000 in Alaska, the Governor signed H.B. 121 into law. This bill, which was sponsored by Representative Bunde, relates to a patient’s right to dental care. A health plan will not be able to restrict in any way a patient’s access to a dentist when the plan contract covers dental care. An enrollee will be able to bring civil action against the health insurer if his/her right to a dentist is impeded.

On May 19, 2000, in Maryland, the Governor vetoed three measures for being duplicative. S.B. 359, sponsored by Senator Exum, would have required an HMO to establish a mechanism that would limit the number of enrollees assigned to each provider to create a balance in the amount of patients each provider receives from the HMO.

The Governor in Maryland also vetoed S.B. 497 on May 19, 2000. Senator Bromwell sponsored this measure that would have required HMOs to be financially responsible for all payments to any external provider that renders healthcare services that are currently covered under the plan’s contract.

Senator Exum also sponsored the third bill in Maryland to be vetoed. S.B. 567 would have allowed the classification of an obstetrician/gynecologist as a woman’s primary care provider under an HMO health plan. A woman would have also been able to select an in-network certified mid-wife as her obstetric primary care provider.

S.F. 3156 passed the Senate on March 27, 2000 and was amended on the House floor on May 17, 2000 in Minnesota. Senator Berglin sponsored this act, which would provide patient protection measures and also coverage for clinical trials. S.F. 3156 would allow enrollees to seek treatment for a life threatening disorder, early detection or treatment of cancer through clinical trials.

In New Hampshire on May 17, 2000, the House concurred with Senate amendments to H.B. 1377, which was sponsored by Representative Martel. This bill would prohibit managed care organizations from excluding healthcare providers that are not certified by the American Board of Medical Specialists from the organization’s network. A committee would also be established by this bill to study the methods managed care organizations use to contract with healthcare providers.

Also In New Hampshire, on May 11, 2000, H.B. 1240, sponsored by Representative Crosby, passed the Senate and was sent back to the House for concurrence. On May 18, 2000 the House concurred with the Senate’s amendments. This measure would require health insurers to pay for services rendered by healthcare providers within 45 calendar days upon receipt of a clean written claim, or 15 calendar days upon receipt of a clean electronic claim. If the insurer fails to pay within that time-frame, the provider must send the insurer a notice that the claim must be paid within ten days or an interest payment at 1.5 percent per month will be charged along with any relevant attorney or advisor fees.

New Hampshire S.B. 383, a measure similar to H.B. 1240, passed the House and was sent to the Senate for concurrence on May 17, 2000. Senator Pignatelli sponsored this measure.

Four bills were recently introduced in North Carolina that relate to managed care or patient protection. H.B. 1538, sponsored by Representative Nye, was introduced and sent to the House Committee on Insurance on May 16, 2000. This measure would establish standards for external review procedures to ensure an enrollee’s right to an independent review of treatment decisions made by an insurer. This bill would also establish that a written notice explaining how to request an external review would be required to be included along with the final decision of a second-level grievance review panel.

Senator Wellons sponsored S.B. 1324 in North Carolina on May 18, 2000. This measure is the same as H.B. 1538.

Representative Nye and Senator Wellons introduced other companion bills in North Carolina, H.B. 1529 and S.B. 1325, on May 15, 2000 and May 18, 2000 respectively. These measures would require the state Insurance Commissioner to levy an assessment on solvent HMO carriers in order to pay claims and continue the coverage of enrollees who participated in an insolvent HMO. The assessment may not exceed two percent of the HMO’s average annual premium revenue.

H.B. 2072 was passed by the Senate in Oklahoma, but the House refused to concur with Senate’s amendments. On May 18, 2000, a conference committee report was submitted. This bill, which was sponsored by Representative Morgan, amends the Oklahoma managed care act. H.B. 2072 would establish that health benefit plans could not deny emergency care coverage due to a lack of prior notification. If a patient or layperson believes that a condition is serious and needs medical attention, then the patient’s screening, evaluation and examination to determine condition status will be covered. However, if a provider later determines that the patient’s condition is not an emergency, then all other care is not required to be covered by the plan.

Also in Oklahoma, the Senate refused to concur with the House amendments to S.B. 1588 on April 27, 2000. On May 18, 2000, the bill was sent to a conference committee. This measure, sponsored by Senator Monson, relates to the Oklahoma managed care act by modifying definitions of terms used in the act.

Mandated Benefits

Cancer Mandates: In Delaware and Maryland, legislation addressing benefit mandates for the treatment or diagnosis of cancer was addressed. H.B. 564, by Representative Maier, was reported from the Delaware House Committee on Economic Development, Banking and Insurance without a recommendation on May 18, 2000. This measure would have required specified group and individual insurers, as well as HMOs and health service corporations, to provide coverage for colorectal cancer screening under specified conditions.

Maryland H.B. 22, which was sponsored by Delegate Conroy, was signed into law on May 11, 2000. This legislation will require certain insurers, HMOs and health service plans to provide coverage for prescription hair prosthesis for chemotherapy patients being treated for cancer.

Clinical Trials Mandates:

Legislation concerning coverage of clinical trial participation was considered in California, Minnesota and New Hampshire. Senator Speier’s bill, California S.B. 1838, was assigned to the Senate Appropriations Committee’s suspense file on May 15, 2000. This legislation would require specified health insurance carriers to provide enrollees with coverage of routine patient care costs associated with clinical trial participation for life-threatening prostate cancer under certain specified circumstances. This coverage must be provided to enrollees on or after January 1, 2001, and the health plans must annually report to the state the number of enrollees that received coverage as a result of this mandate.

In Minnesota, S.F. 3156, which was sponsored by Senator Berglin, was amended on the House floor on May 17, 2000. This legislation would require health benefit plans to provide coverage for participation in medical clinical trials under specified conditions.

Senator Wheeler, of New Hampshire, introduced legislation that would require certain health benefit plans to provide coverage of participation in certain clinical trials. S.B. 409 passed the House on May 18, 2000 and was sent back to the Senate for concurrence.

Other Mandates: Other types of mandated benefit legislation were debated in state legislatures around the nation as well. Some of these bills include the following measures:

California S.B. 2046 would amend the state’s existing law prohibiting certain insurers from excluding coverage for prescription drugs on the basis that the drugs were not approved for marketing by the FDA for the prescribed indication if certain conditions are met. This legislation specifies that one of the acceptable conditions is if a drug is prescribed for a disabling or chronic condition.

On May 16, 2000 the Delaware House passed S.B. 87 and referred the measure back to the Senate for concurrence. This bill, which was sponsored by Senator Henry last session, would require insurance coverage of all FDA-approved prescription contraceptive drugs and devices.

Representative Prieguez’s bill, Florida H.B. 399, was sent to the Governor’s desk on May 22, 2000. This legislation requires certain insurers and managed care entities to provide coverage for newborn hearing screening services and referrals for ongoing treatment if needed.

Maryland S.B. 516 was signed into law on May 11, 2000. This legislation prohibits certain health insurance carriers and HMOs from excluding coverage of in vitro fertilization if the patient and her spouse meet certain specified conditions. An exemption from the mandate exists if the couple’s infertility is caused by certain factors.

Representative Taylor introduced Pennsylvania H.B. 2566 on May 18, 2000. This legislation would establish that any health insurance policy that provides coverage for FDA-approved drugs could not exclude coverage of an FDA-approved drug lawfully prescribed by a health professional for an enrollee who has a chronic, disabling or life-threatening illness, even if the drug is not approved for marketing for that particular indication. However, the drug therapy would have to meet other specified conditions for the coverage mandate to take effect.

Medical Savings Accounts

On May 18, 2000 in New Hampshire, H.B. 1510, sponsored by Representative Wendleboe, failed to pass the Senate. This measure would have established a medical savings account program for state employees. Funds contributed to the medical savings account would have to have been used exclusively for qualifying medical or surgical care. This program would have been contingent on the passage of federal legislation authorizing the expansion of access to medical savings accounts.

Mental Health and Substance Abuse Parity

Parity legislation was addressed recently in California, South Carolina and Vermont. California S.B. 1764, introduced by Senator Chesbro on February 23, 2000, would require specified health insurance contracts, disability policies and self-insured employee welfare benefit plans to provide enrollees with coverage for certain types of alcohol and/or drug abuse treatment services. This legislation was assigned to the Senate Committee Appropriation’s suspense file on May 15, 2000.

In South Carolina, Senator McConnell introduced legislation on January 18, 2000 that would require certain health insurers to provide coverage for mental health and substance abuse treatment. Insurers would be prohibited from placing any access restrictions or cost-sharing requirements on mental health and/or substance abuse treatment that were greater than those imposed on the treatment of other physical illnesses. S.B. 1041 passed the House Ways and Means Committee as amended on May 17, 2000.

Vermont H.B. 628, sponsored by Representative Alfano, was signed by the Governor on May 17, 2000. This new law will require each health insurance carrier in the state to annually file a report with the state Commissioner of Banking, Insurance, Securities and Health Administration concerning quality measures for mental health and substance abuse services. The report will have to include the company’s loss ratio for mental health and substance abuse treatment expenses.

Single-Payer

In New York, Assembly Member Gottfried’s bill, A.B. 3571/S.B. 5611, which would establish a single-payer health system in New York, passed the Assembly Health Committee and was assigned to the Assembly Committee on Ways and Means on May 16, 2000.