BILL REPORT

HB 99

BYRepresentatives Niemi, Cantwell, Vekich, Braddock, Fisch and Brekke

Creating the Washington state health insurance pool.

House Committe on Health Care

Majority Report:     The substitute bill be substituted therefor and the substitute bill do pass.  (11)

     Signed by Representatives Braddock, Chair; Day, Vice Chair; Bristow, Brooks, Bumgarner, Cantwell, Lewis, Lux, D. Sommers, Sprenkle and Vekich.

House Staff:Bill Hagens (786-7131)

AS REPORTED BY COMMITTEE ON HEALTH CARE FEBRUARY 13, 1987

BACKGROUND:

In the state of Washington there are roughly 720,000 persons under the age of 65 who are uninsured.  Three hundred and ten thousand of that number have income in excess of 200 percent of the federal poverty level.  A subset of that group of people, estimated up to 30,000, do not have coverage because of denial for poor health or because available coverage is very expensive with restrictive exclusions for existing conditions.

The Washington Health Care Project Commission, in its report outlining recommendations for a basic health plan, raised the need for "the creation of an insurance pool for the medically uninsurable with incomes over 200% of the poverty level."

SUMMARY:

SUBSTITUTE BILL:  A non-profit comprehensive insurance pool is created that shall include all health insurers, health care service contractors, and health maintenance organizations.  Provisions are made to include self-funded programs in the pool, if permitted by federal law in the future.

A board is created to develop an insurance pool plan and submit it to the insurance commissioner for review and approval.

The board shall select a plan administrator through a competitive bid process.

Eligible persons shall be:  state residents who have been rejected for coverage, or have had related problems obtaining coverage within a six month period prior to application.

The package of benefits shall be comprehensive including:  in-patient and out-patient care, drugs, nursing home care, etc.

The plan shall have:

(1) Two deductible options of $500 and $1,000, with related caps on out of pocket expenses;

(2)  Coinsurance of 20 percent of benefits provided;

(3)  Maximum coverage of $500,000; and

(4)  Premiums set at 150 percent of the standard group rate set for groups up to ten persons.

Cost of providing care beyond premiums, deductibles, and co-payments collected shall be assessed among pool members on an per capita basis.

The bill exempts premiums of the pool from premium taxes and provides certain deductions of assessment from business and occupation (B&O) taxes.

SUBSTITUTE BILL COMPARED TO ORIGINAL:  The number of board members appointed by the insurance commissioner is limited to three, instead of up to nine.  Language is added that would include self-insurers to the pool, if permitted by federal law.  Method of setting the premiums is changed from 150 percent of the standard individual rate to 150 percent of the standard group rate for groups up to ten persons.  A legislative report is added.

Fiscal Note:    Attached.

House Committee ‑ Testified For:     Matthew Lommers; Susan Lommers; Hilary Tresner; Morris Rosenberg, Cystic Fibrosis Foundation; Sue Zimmerman, Cystic Fibrosis Foundation; Jim Holm, Dorian Group; Terry Gonye-Magee, American Diabetes Association; Rick Horsman, American Diabetes Association; Carl Knirk, American Diabetes Association; Colin Kippen, American Diabetes Association; Lois Fink, National Foundation for Ileitis and Colitis; Donna Portuesi, National Foundation for Ileitis and Colitis; Pam Batchelor, National Hospital Union L1199.

House Committee - Testified Against: None Presented.

House Committee - Testimony For:     This coverage is needed to provide for persons who are unable to obtain coverage because of poor health.

House Committee - Testimony Against: None Presented.