Mandated Health Coverage Review Panel
Creates a mandated health care service coverage review panel to assess the social, financial, and medical impacts of mandated health insurance coverage. Repeals the state auditor's duty to review such proposals.
HOUSE OF REPRESENTATIVES
TWENTY-SECOND LEGISLATURE, 2003
STATE OF HAWAII
A BILL FOR AN ACT
relating to health insurance.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that there is a continued interest in requiring that health carriers offer certain health coverages, and that the resulting improved access to health care services may have beneficial consequences for society in general.
The legislature finds, however, that the growing cost of these mandated health care service coverages is of continuing concern, and that the merits of a particular benefit must be balanced against consequences that extend far beyond the impact that mandating the benefit will have on the cost of health insurance.
The legislature therefore finds and declares that a systematic review of proposed mandated health care service coverages that explores all the ramifications of the proposed legislation will assist the legislature in determining whether mandating a particular coverage will be in the public interest.
The purpose of this Act is to replace the existing procedure for reviewing proposed mandatory health insurance coverage under section 23-51, Hawaii Revised Statutes, with a chapter that provides a more comprehensive assessment of these proposed coverages, and their social, financial, and medical costs and benefits.
SECTION 2. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
MANDATED HEALTH CARE SERVICE COVERAGE REVIEW
§ -1 Definitions. As used in this chapter, unless the context clearly requires otherwise:
(1) An insurer under article 10A of chapter 431;
(2) A mutual benefit society organized under article 1 of chapter 432;
(3) A health maintenance organization established under chapter 432D; or
(4) Any other person who provides health benefit plans subject to regulation by the State.
"Mandated health care service coverage" means coverage of:
(1) A particular health care service; or
(2) A category of health provider
that a carrier or other organization authorized to provide health benefit plans in the State is required by state law to include in its plans.
"Review panel" means the review panel on mandated health care service coverage.
§ -2 Review panel on mandated health care service coverage. (a) There is created the review panel on mandated health care service coverage within the department of commerce and consumer affairs for administrative purposes only.
(b) The review panel shall be composed of the following fifteen members, of which the last eight shall be appointed by the governor pursuant to section 26-34:
(1) The insurance commissioner or commissioner's designee;
(2) The auditor or auditor's designee;
(3) The director of health or director's designee;
(4) The chairperson of the senate committee on ways and means, or chairperson's designee;
(5) The chairperson of the house committee on finance, or chairperson's designee;
(6) The chairperson of the senate committee on health, or the chairperson's designee;
(7) The chairperson of the house committee on health, or chairperson's designee;
(8) A licensed registered nurse;
(9) A licensed physician;
(10) A health economist with expertise in the planning, delivery, and economic aspects of health care, including knowledge of the operation of health care delivery systems;
(11) A medical ethicist; and/or a health and elder law expert;
(12) A representative of a mutual benefit society organized under article 1 of chapter 432; and
(13) Three members who represent the business community.
(c) Each member appointed by the governor shall serve for a term of three years; provided that the governor shall initially appoint three members to serve for one year, three members to serve for two years, and three members to serve for three years.
(d) Vacancies occurring before the expiration of a member's term shall be filled by election of the review panel. Individuals elected to fill a vacancy shall serve only for the remainder of the unexpired term. If five vacancies exist at any one time, no remaining member shall resign until at least one vacancy has been filled in accordance with this section.
A member whose term has expired may continue to serve as a holdover member until a successor is elected; provided that the holdover shall not serve beyond the end of the second regular legislative session following the expiration of the member's term of office.
(e) The insurance commissioner shall serve as chairperson of the review panel. The review panel shall appoint from its members a vice chairperson and secretary and any other officers that the review panel may deem necessary or desirable to carry out its functions. Eight members shall constitute a quorum, whose affirmative vote shall be necessary for all actions by the panel.
(f) Members shall serve without compensation, but may be reimbursed for expenses, including travel expenses, necessarily incurred in the performance of their duties.
(g) No person shall serve on the review panel who has any actual or potential conflict of interest as defined in section 84-14.
§ -3 Review panel meetings. All review panel meetings shall be open to the public pursuant to section 92-3. However, when it is necessary for the review panel to receive information that is proprietary or confidential, the review panel may enter into closed executive meeting pursuant to sections 92-4 and 92-5.
§ -4 Duties of the review panel. (a) The review panel shall establish a baseline for assessment of proposed mandated health care service coverages through the review and evaluation of the extent and cost of health care services provided to consumers of health insurance benefits in this State. The review panel shall determine:
(1) The average premium cost of health insurance benefits as a percentage of the average annual wage, as determined by the department of human resources development assisted by the department of accounting and general services;
(2) The portion of the premium cost attributable to benefits that would be provided regardless of statutory mandates; and
(3) The portion of the premium cost attributable to mandated health care service coverages.
(b) The review panel shall assess the financial and social impact of each proposed mandated health care service coverage by considering:
(1) Financial impact including:
(A) The extent to which mandating coverage will increase or decrease the cost of the service;
(B) The extent to which mandating coverage will increase use of the service and attendant costs;
(C) The extent to which the mandated service will be used as a substitute for a more expensive service and result in cost savings;
(D) The extent to which mandating coverage will increase or decrease the administrative expenses of carriers, and the premiums and administrative expenses of policyholders, members of mutual benefit societies, and subscribers of health maintenance organizations;
(E) The effect of mandating coverage on the total cost of health care; and
(F) The effect of mandating coverage on consumer access to health insurance, and on employers' ability to purchase health benefits policies to meet their employees' needs;
(2) Social impact including:
(A) The extent to which the service is used;
(B) The level of public demand for the service;
(C) The extent to which coverage is already generally available, and if coverage is not generally available, the extent to which the lack of coverage:
(i) Results in individuals avoiding necessary health care treatment; or
(ii) Results in unreasonable hardship;
(D) The level of public demand for the coverage;
(E) The level of interest of collective bargaining agents in negotiating privately for inclusion of this coverage in group contracts; and
(F) The social benefits of providing the mandated health insurance service, including an assessment of the extent to which there is evidence of the efficacy of the health care service to be mandated;
(3) Medical impact, or evidence of health care service efficacy including:
(A) The extent to which the mandated benefit will enhance the general health status of consumers of health insurance benefits;
(B) If the services of a category of health providers are to be mandated, the extent to which there are professionally accepted controlled trials demonstrating the health consequences of the services of this category of provider; and
(C) If a service other than those of a specific category of health care providers is to be mandated, the extent to which there are professionally controlled trials demonstrating the health consequences of that service, and comparing the health consequences of that service to those of alternative services, or no service.
§ -5 Proposed mandated health care service coverages. Every person or organization that seeks to establish a mandated health care service coverage shall, at least ninety days prior to the regular legislative session at which the legislation will be introduced, submit a mandated health care service coverage assessment to the review panel. The assessment shall include the financial and social impact, and evidence of health care service efficacy of the proposed coverage in strict adherence to the criteria in section -4.
§ -6 Initial assessment of cost of existing mandated coverages; recurrent evaluations. The review panel shall conduct an initial assessment of the cost of all mandated health insurance service coverages that have been established by law for a minimum of five years and submit its findings to the governor and the legislature no later than twenty days prior to the convening of the regular session of 2007 and every five years thereafter.
§ -7 Annual assessment of proposed mandated coverages. The review panel shall submit a report of its assessment of proposed mandated health care service coverages to the governor and the legislature no later than twenty days prior to the convening of each regular session.
§ -8 Carriers to submit data. The review panel may make reasonable requests of carriers to submit data on the use or cost of a mandated health care service or other information needed to carry out the purposes of this chapter.
§ -9 Staff services. The office of the insurance commissioner shall provide staff support to the review panel and may contract for actuarial services and other professional services to carry out the purposes of this chapter."
SECTION 3. Section 23-51, Hawaii Revised Statutes, is repealed.
"[PART IV.] SOCIAL AND FINANCIAL ASSESSMENT OF
PROPOSED MANDATORY HEALTH INSURANCE COVERAGE
§23-51 Proposed mandatory health insurance coverage; impact assessment report. Before any legislative measure that mandates health insurance coverage for specific health services, specific diseases, or certain providers of health care services as part of individual or group health insurance policies, can be considered, there shall be concurrent resolutions passed requesting the auditor to prepare and submit to the legislature a report that assesses both the social and financial effects of the proposed mandated coverage. The concurrent resolutions shall designate a specific legislative bill that: (1) Has been introduced in the legislature; and (2) Includes, at a minimum, information identifying the: (A) Specific health service, disease, or provider that would be covered; (B) Extent of the coverage; (C) Target groups that would be covered; (D) Limits on utilization, if any; and (E) Standards of care.
For purposes of this part, mandated health insurance coverage shall not include mandated optionals."]
SECTION 4. Statutory material to be repealed is bracketed and stricken.
SECTION 5. This Act shall take effect on July 1, 2003.