Report Title:

Prepaid Health Care

 

Description:

Mandates that the prepaid health care advisory council not include a member from the insurance industry. Creates temporary commission to create a federal legislative package. (SD1)

 

THE SENATE

S.B. NO.

2086

TWENTY-FIRST LEGISLATURE, 2002

S.D. 1

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO prepaid health care PLAN.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Current law in section 393-7(a), Hawaii Revised Statutes, relating to approval of prepaid health care plans, requires the director of labor and industrial relations, after advice by the prepaid health care advisory council, to determine whether or not a prepaid health care plan is qualified under Hawaii law to offer benefits under chapter 393, Hawaii Revised Statutes, relating to the prepaid health care Act. The legislature finds that new health plans seeking entry into Hawaii, particularly employer-sponsored health plans, have had difficulty obtaining approval from the advisory council. This gatekeeper process, though well intended, has resulted in a lack of competition in the marketplace for prepaid health care plans, with a probable impact on health insurance rates.

The federal Employee Retirement Income Security Act (ERISA), title 29 United States Code section 1144, as amended, supersedes any amendment to the Prepaid Health Care Act enacted after September 2, 1974, that provides for "more than the effective administration of such Act....". This Act does not amend substantive provisions of the Prepaid Health Care Act or impose new obligations upon employers; therefore, it is not affected by the ERISA preemption.

The purpose of this Act is to provide for more effective administration of the Prepaid Health Care Act by mandating that the prepaid health care advisory council shall not include a member from the insurance industry.

SECTION 2. Section 393-7, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) The prepaid health care advisory council shall be appointed by the director and shall include representatives of the medical and public health professions, representatives of consumer interests, and persons experienced in prepaid health care protection. The council shall not include a member representing the insurance industry. The membership of the council shall not exceed seven individuals."

SECTION 3. Temporary prepaid health care plan legislative commission. (a) There is established within the department of labor and industrial relations, for administrative purposes, a temporary prepaid health care plan legislative commission to create federal legislation to be submitted for consideration to the United States Congress. The commission shall be composed of nine members to be appointed by the governor, as follows:

(1) Three members shall represent the labor industry;

(2) Three members shall represent private business interests; and

(3) Three members shall otherwise represent the government of the State of Hawaii.

(b) The temporary commission shall develop legislation to be submitted for consideration to the United States Congress. The package developed by the commission shall include measures regarding:

(1) Employee contributions to a prepaid health care plan;

(2) Mandated benefits;

(3) The effect of an employer's size on participation in a prepaid health care plan; and

(4) Participation by part-time employees in a prepaid health care plan.

(c) The commission shall report to the legislature, including submission of all proposed federal legislation, at least twenty days prior to convening of the regular session of 2003.

(d) The commission created by this section shall cease to exist on June 30, 2003.

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.