AN ACT Relating to
modifying the definition of small employers for insurance purposes; and
amending RCW 48.43.005.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:
Sec. 1. RCW 48.43.005 and 2000 c
79 s 18 are each amended to read as follows:
Unless otherwise
specifically provided, the definitions in this section apply throughout this
chapter.
(1) "Adjusted
community rate" means the rating method used to establish the premium for
health plans adjusted to reflect actuarially demonstrated differences in
utilization or cost attributable to geographic region, age, family size, and
use of wellness activities.
(2) "Basic health
plan" means the plan described under chapter 70.47 RCW, as revised from
time to time.
(3) "Basic health
plan services" means that schedule of covered health services, including
the description of how those benefits are to be administered, that are required
to be delivered to an enrollee under the basic health plan, as revised from
time to time.
(4) "Catastrophic
health plan" means:
(a) In the case of a
contract, agreement, or policy covering a single enrollee, a health benefit
plan requiring a calendar year deductible of, at a minimum, one thousand five
hundred dollars and an annual out-of-pocket expense required to be paid under
the plan (other than for premiums) for covered benefits of at least three
thousand dollars; and
(b) In the case of a
contract, agreement, or policy covering more than one enrollee, a health
benefit plan requiring a calendar year deductible of, at a minimum, three
thousand dollars and an annual out-of-pocket expense required to be paid under
the plan (other than for premiums) for covered benefits of at least five
thousand five hundred dollars; or
(c) Any health benefit
plan that provides benefits for hospital inpatient and outpatient services,
professional and prescription drugs provided in conjunction with such hospital
inpatient and outpatient services, and excludes or substantially limits
outpatient physician services and those services usually provided in an office
setting.
(5)
"Certification" means a determination by a review organization that
an admission, extension of stay, or other health care service or procedure has
been reviewed and, based on the information provided, meets the clinical
requirements for medical necessity, appropriateness, level of care, or
effectiveness under the auspices of the applicable health benefit plan.
(6) "Concurrent
review" means utilization review conducted during a patient's hospital
stay or course of treatment.
(7) "Covered
person" or "enrollee" means a person covered by a health plan
including an enrollee, subscriber, policyholder, beneficiary of a group plan,
or individual covered by any other health plan.
(8)
"Dependent" means, at a minimum, the enrollee's legal spouse and
unmarried dependent children who qualify for coverage under the enrollee's
health benefit plan.
(9) "Eligible
employee" means an employee who works on a full-time basis with a normal
work week of thirty or more hours. The term includes a self-employed
individual, including a sole proprietor, a partner of a partnership, and may
include an independent contractor, if the self-employed individual, sole
proprietor, partner, or independent contractor is included as an employee under
a health benefit plan of a small employer, but does not work less than thirty
hours per week and derives at least seventy-five percent of his or her income
from a trade or business through which he or she has attempted to earn taxable income
and for which he or she has filed the appropriate internal revenue service
form. Persons covered under a health benefit plan pursuant to the consolidated
omnibus budget reconciliation act of 1986 shall not be considered eligible
employees for purposes of minimum participation requirements of chapter 265,
Laws of 1995.
(10) "Emergency
medical condition" means the emergent and acute onset of a symptom or
symptoms, including severe pain, that would lead a prudent layperson acting
reasonably to believe that a health condition exists that requires immediate
medical attention, if failure to provide medical attention would result in
serious impairment to bodily functions or serious dysfunction of a bodily organ
or part, or would place the person's health in serious jeopardy.
(11) "Emergency
services" means otherwise covered health care services medically necessary
to evaluate and treat an emergency medical condition, provided in a hospital
emergency department.
(12) "Enrollee
point-of-service cost-sharing" means amounts paid to health carriers
directly providing services, health care providers, or health care facilities
by enrollees and may include copayments, coinsurance, or deductibles.
(13)
"Grievance" means a written complaint submitted by or on behalf of a
covered person regarding: (a) Denial of payment for medical services or
nonprovision of medical services included in the covered person's health
benefit plan, or (b) service delivery issues other than denial of payment for
medical services or nonprovision of medical services, including dissatisfaction
with medical care, waiting time for medical services, provider or staff
attitude or demeanor, or dissatisfaction with service provided by the health
carrier.
(14) "Health care
facility" or "facility" means hospices licensed under chapter
70.127 RCW, hospitals licensed under chapter 70.41 RCW, rural health care
facilities as defined in RCW 70.175.020, psychiatric hospitals licensed under
chapter 71.12 RCW, nursing homes licensed under chapter 18.51 RCW, community
mental health centers licensed under chapter 71.05 or 71.24 RCW, kidney disease
treatment centers licensed under chapter 70.41 RCW, ambulatory diagnostic,
treatment, or surgical facilities licensed under chapter 70.41 RCW, drug and
alcohol treatment facilities licensed under chapter 70.96A RCW, and home health
agencies licensed under chapter 70.127 RCW, and includes such facilities if
owned and operated by a political subdivision or instrumentality of the state
and such other facilities as required by federal law and implementing
regulations.
(15) "Health care
provider" or "provider" means:
(a) A person regulated
under Title 18 or chapter 70.127 RCW, to practice health or health-related
services or otherwise practicing health care services in this state consistent
with state law; or
(b) An employee or
agent of a person described in (a) of this subsection, acting in the course and
scope of his or her employment.
(16) "Health care
service" means that service offered or provided by health care facilities
and health care providers relating to the prevention, cure, or treatment of
illness, injury, or disease.
(17) "Health
carrier" or "carrier" means a disability insurer regulated under
chapter 48.20 or 48.21 RCW, a health care service contractor as defined in RCW
48.44.010, or a health maintenance organization as defined in RCW 48.46.020.
(18) "Health
plan" or "health benefit plan" means any policy, contract, or
agreement offered by a health carrier to provide, arrange, reimburse, or pay
for health care services except the following:
(a) Long-term care
insurance governed by chapter 48.84 RCW;
(b) Medicare
supplemental health insurance governed by chapter 48.66 RCW;
(c) Limited health care
services offered by limited health care service contractors in accordance with
RCW 48.44.035;
(d) Disability income;
(e) Coverage incidental
to a property/casualty liability insurance policy such as automobile personal
injury protection coverage and homeowner guest medical;
(f) Workers'
compensation coverage;
(g) Accident only
coverage;
(h) Specified disease
and hospital confinement indemnity when marketed solely as a supplement to a
health plan;
(i) Employer-sponsored
self-funded health plans;
(j) Dental only and vision
only coverage; and
(k) Plans deemed by the
insurance commissioner to have a short-term limited purpose or duration, or to
be a student-only plan that is guaranteed renewable while the covered person is
enrolled as a regular full-time undergraduate or graduate student at an
accredited higher education institution, after a written request for such
classification by the carrier and subsequent written approval by the insurance
commissioner.
(19) "Material
modification" means a change in the actuarial value of the health plan as
modified of more than five percent but less than fifteen percent.
(20) "Preexisting
condition" means any medical condition, illness, or injury that existed
any time prior to the effective date of coverage.
(21)
"Premium" means all sums charged, received, or deposited by a health
carrier as consideration for a health plan or the continuance of a health
plan. Any assessment or any "membership," "policy,"
"contract," "service," or similar fee or charge made by a
health carrier in consideration for a health plan is deemed part of the
premium. "Premium" shall not include amounts paid as enrollee
point-of-service cost-sharing.
(22) "Review
organization" means a disability insurer regulated under chapter 48.20 or
48.21 RCW, health care service contractor as defined in RCW 48.44.010, or
health maintenance organization as defined in RCW 48.46.020, and entities
affiliated with, under contract with, or acting on behalf of a health carrier
to perform a utilization review.
(23) "Small employer"
or "small group" means any person, firm, corporation, partnership,
association, political subdivision ((except school districts)), or
self-employed individual that is actively engaged in business that, on at least
fifty percent of its working days during the preceding calendar quarter,
employed no more than fifty eligible employees, with a normal work week of
thirty or more hours, the majority of whom were employed within this state, and
is not formed primarily for purposes of buying health insurance and in which a
bona fide employer-employee relationship exists. In determining the number of
eligible employees, companies that are affiliated companies, or that are
eligible to file a combined tax return for purposes of taxation by this state,
shall be considered an employer. Subsequent to the issuance of a health plan
to a small employer and for the purpose of determining eligibility, the size of
a small employer shall be determined annually. Except as otherwise
specifically provided, a small employer shall continue to be considered a small
employer until the plan anniversary following the date the small employer no
longer meets the requirements of this definition. The term "small
employer" includes a self-employed individual or sole proprietor. The term
"small employer" also includes a self-employed individual or sole
proprietor who derives at least seventy-five percent of his or her income from
a trade or business through which the individual or sole proprietor has
attempted to earn taxable income and for which he or she has filed the
appropriate internal revenue service form 1040, schedule C or F, for the
previous taxable year.
(24) "Utilization
review" means the prospective, concurrent, or retrospective assessment of
the necessity and appropriateness of the allocation of health care resources
and services of a provider or facility, given or proposed to be given to an
enrollee or group of enrollees.
(25)
"Wellness activity" means an explicit program of an activity
consistent with department of health guidelines, such as, smoking cessation,
injury and accident prevention, reduction of alcohol misuse, appropriate weight
reduction, exercise, automobile and motorcycle safety, blood cholesterol
reduction, and nutrition education for the purpose of improving enrollee health
status and reducing health service costs.
