Report Title:

Insurance

Description:

Allows health insurers to treat a trade association and its members as a single group for the purpose of issuing a health insurance policy, while allowing members of the trade association to opt out and obtain their own insurance. Prohibits the health insurer from requiring the association to offer only that insurer's plan.

HOUSE OF REPRESENTATIVES

H.B. NO.

2408

TWENTY-SECOND LEGISLATURE, 2004

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO INSURANCE.

 

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

SECTION 1. Chapter 431, Hawaii Revised Statutes, is amended by adding to part VI of article 10A a new section to be appropriately designated and to read as follows:

"431:10A- Trade associations. (a) At the option of a trade association, an insurer that sells health insurance to the trade association shall treat the trade association and its members as a group for the purpose of issuing a health insurance policy, provided that:

(1) The trade association shall have been formed for purposes other than obtaining insurance;

(2) The insurer shall be prohibited from restricting, in any manner, the number or types of health plans issued by another insurance entity that the trade association may offer to its members, including but not limited to such restrictions as clauses that reduce competition between insurers or clauses that require a trade association to allow an insurer to match the price or terms offered by another insurer;

(3) Each member of the trade association shall not be required to be insured under the group policy; and

(4) This requirement shall be inapplicable if less than two persons from the trade association seek to be insured under the group policy.

(b) As used in this section:

"Trade association" means an association of persons organized to promote common interests and comprised of persons engaged in a business, trade, or profession."

SECTION 2. Chapter 432, Hawaii Revised Statutes, is amended by adding to part I a new section to be appropriately designated and to read as follows:

"432- Trade associations. (a) At the option of a trade association, a mutual benefit society that operates a health plan and sells health insurance to the trade association shall treat the trade association and its members as a group for the purpose of issuing a health insurance policy, provided that:

(1) The trade association shall have been formed for purposes other than obtaining insurance;

(2) The mutual benefit society shall be prohibited from restricting, in any manner, the number or types of health plans issued by another insurance entity that the trade association may offer to its members, including but not limited to such restrictions as clauses that reduce competition between insurers or clauses that require a trade association to allow an insurer to match the price or terms offered by another insurer;

(3) Each member of the trade association shall not be required to be insured under the group policy; and

(4) This requirement shall be inapplicable if less than two persons from the trade association seek to be insured under the group policy.

(b) As used in this section:

"Trade association" means an association of persons organized to promote common interests and comprised of persons engaged in a business, trade or profession."

SECTION 3. Chapter 432D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"432D- Trade associations. (a) At the option of a trade association, a health maintenance organization that sells health insurance to the trade association shall treat the trade association and its members as a group for the purpose of issuing a health insurance policy, provided that:

(1) The trade association shall have been formed for purposes other than obtaining insurance;

(2) The health maintenance organization shall be prohibited from restricting, in any manner, the number or types of health plans issued by another insurance entity that the trade association may offer to its members, including but not limited to such restrictions as clauses that reduce competition between insurers or clauses that require a trade association to allow an insurer to match the price or terms offered by another insurer;

(3) Each member of the trade association shall not be required to be insured under the group policy; and

(4) This requirement shall be inapplicable if less than two persons from the trade association seek to be insured under the group policy.

(b) As used in this section:

"Trade association" means an association of persons organized to promote common interests and comprised of persons engaged in a business, trade or profession."

SECTION 4. New statutory material is underscored.

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

INTRODUCED BY:

_____________________________

BY REQUEST