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.
