LRB 0921

DATE:		September 24, 2009
TO:		All Legislators
FROM:		Representative Leah Vukmir
RE:		CoSponsorship - LRB 0921/1 – Out-of-state Health Insurance Providers (Across State Lines)
Under this legislation, out-of-state health insurers would be allowed to offer plans in Wisconsin that comply with their own state’s health insurance coverage mandates. The Commissioner of Insurance would be responsible for evaluating the financial solvency and legal status of out-of-state insurers who wish to offer policies in Wisconsin. These insurers would also need to be in good standing with their own commissioner of insurance. Much like automobile, life and homeowners insurers, out-of-state insurers wishing to offer health insurance in Wisconsin would have to obtain a certificate of authority from the commissioner and would be subject to the oversight functions of Wisconsin’s commissioner. Out-of-state insurers would also have to abide by our fair marketing and medical privacy laws. If they do not have an independent claims review process, they would be required to adopt Wisconsin’s statutory provisions to create one for Wisconsin enrollees. The policies would also be required to conform to Wisconsin’s version of the federal HIPAA requirements, particularly the provisions that apply to portability and renewability – even in the individual market. This means that people who want to have fewer mandates would be able to purchase a policy being offered for example – from an Idaho insurer which has 15 mandates or from more expansive benefits required in states like Maryland with 63 mandates; or Minnesota with 64 mandates. To maintain the competitiveness of Wisconsin’s insurers, the commissioner could waive the state mandates to allow a Wisconsin insurer to offer comparable policies to those being offered by the out-of state provider.     Analysis by the Legislative Reference Bureau           Current law specifies how an insurer that is domiciled in another state (a foreign insurer) may transact an insurance business in this state. If the insurer satisfies certain specified requirements, the insurer will be issued a certificate of authority and may offer insurance policies in this state. Generally, unless a specific exemption applies, a foreign insurer that provides insurance coverage to a person or entity in this state is subject to the insurance laws and other requirements of this state. This bill provides that a foreign insurer may offer health care plans to groups and individuals in this state. Both the insurer and the health care plans offered are exempt from all insurance laws and requirements of this state except for certain specified ones. To be able to offer these health care plans, a foreign insurer must be in compliance with all the laws and regulations of the insurer’s domiciliary state that apply to the insurer, must have been issued a certificate of authority by this state to transact an insurance business in this state, must be in compliance with the laws and requirements of this state that do apply to the insurer, and must offer coverage in its domiciliary state under any health care plan that it intends to offer in this state and that health care plan must be in compliance with the laws and regulations of the insurer’s domiciliary state. If there is a conflict between a law of the insurer’s domiciliary state and a law of this state that applies to the insurer or the health care plan, the law of this state takes precedence unless the Commissioner of Insurance (commissioner) exempts the insurer from this state’s law. A foreign insurer offering health care plans under the bill would be subject to the taxation requirements in this state that apply to insurers in general and would be required to pay the assessments that health insurers pay to help fund the Health Insurance Risk-Sharing Plan (HIRSP). Wisconsin statutes and any administrative rules promulgated under those statutes that specifically apply to the foreign insurer and health care plans offered by the insurer include: requirements relating to the disclosure of personal medical information; prohibitions on various unfair marketing practices; requiring insurers to provide notice of an insured’s right to file a complaint with the Office of the Commissioner of Insurance; prohibitions on certain actions relating to whether an applicant or insured has obtained a test, and what the results were, for the presence of human immunodeficiency virus (HIV); preexisting condition, portability, and contract renewability requirements and discrimination prohibitions that apply to employer group health care plans under the federal Health Insurance Portability and Accountability Act of 1996; contract renewability requirements for individual health insurance policies; and prohibitions on a health care plan from refusing to cover the services of certain health care professionals if the health care plan covers the same services when provided by a different type of health care professional. Every application for, and policy of, a health care plan offered by a foreign insurer must include plain language disclosing: 1) the differences between that health care plan and one that is issued in compliance with all of the Wisconsin insurance statutes and rules; and 2) which state’s laws govern the issuance and requirements under the health care plan. The bill also provides that a domestic health insurer may request, and the commissioner must order, an exemption from the Wisconsin insurance laws, as determined by the commissioner, that would allow the insurer to provide health care plans with plan designs that are comparable to those that a foreign insurer may offer under the bill. If you would like to be added as a co-sponsor of LRB 0921/1, please contact the Vukmir office at 6-9180, or reply to this email by 5:00 pm on Monday, October 12th, 2009.
Read LRB 0921/1