Report Title:

Prepaid Health Care Advisory Council

Description:

Prohibits the appointment of certain health care professionals to the Prepaid Health Care Advisory Council.

THE SENATE

S.B. NO.

1377

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO THE PREPAID HEALTH CARE ADVISORY COUNCIL

 

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

SECTION 1. The legislature finds that there exists an appearance of unfair advantage in the current composition of the prepaid healthcare advisory council, as two members have historically been, and are currently, prepaid health care contractors.

Currently, 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 qualifies 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, 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 preempted by the Employee Retirement Income Security Act.

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 persons 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[.]; provided that a person representing a health maintenance organization under chapter 432D, mutual benefit society issuing individual and group hospital or medical service plans under chapter 432, or any other health care organization shall not be a member. The membership of the council shall not exceed seven individuals."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

BY REQUEST