Florida Senate - 2005 COMMITTEE AMENDMENT
Bill No. SB 1660
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CHAMBER ACTION
Senate House
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11 The Committee on Banking and Insurance (Fasano) recommended
12 the following substitute for amendment (605288):
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14 Senate Amendment (with title amendment)
15 Delete everything after the enacting clause
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17 and insert:
18 Section 1. Paragraph (l) of subsection (3) of section
19 408.05, Florida Statutes, is amended to read:
20 408.05 State Center for Health Statistics.--
21 (3) COMPREHENSIVE HEALTH INFORMATION SYSTEM.--In order
22 to produce comparable and uniform health information and
23 statistics, the agency shall perform the following functions:
24 (l) Develop, in conjunction with the State
25 Comprehensive Health Information System Advisory Council, and
26 implement a long-range plan for making available performance
27 outcome and financial data that will allow consumers to
28 compare health care services. The performance outcomes and
29 financial data the agency must make available shall include,
30 but is not limited to, pharmaceuticals, physicians, health
31 care facilities, and health plans and managed care entities.
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1 The agency shall submit the initial plan to the Governor, the
2 President of the Senate, and the Speaker of the House of
3 Representatives by January March 1, 2006 2005, and shall
4 update the plan and report on the status of its implementation
5 annually thereafter. The agency shall also make the plan and
6 status report available to the public on its Internet website.
7 As part of the plan, the agency shall identify the process and
8 timeframes for implementation, any barriers to implementation,
9 and recommendations of changes in the law that may be enacted
10 by the Legislature to eliminate the barriers. As preliminary
11 elements of the plan, the agency shall:
12 1. Make available performance outcome and patient
13 charge data collected from health care facilities pursuant to
14 s. 408.061(1)(a) and (2). The agency shall determine which
15 conditions and procedures, performance outcomes, and patient
16 charge data to disclose based upon input from the council.
17 When determining which conditions and procedures are to be
18 disclosed, the council and the agency shall consider variation
19 in costs, variation in outcomes, and magnitude of variations
20 and other relevant information. When determining which
21 performance outcomes to disclose, the agency:
22 a. Shall consider such factors as volume of cases;
23 average patient charges; average length of stay; complication
24 rates; mortality rates; and infection rates, among others,
25 which shall be adjusted for case mix and severity, if
26 applicable.
27 b. May consider such additional measures that are
28 adopted by the Centers for Medicare and Medicaid Studies,
29 National Quality Forum, the Joint Commission on Accreditation
30 of Healthcare Organizations, the Agency for Healthcare
31 Research and Quality, or a similar national entity that
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1 establishes standards to measure the performance of health
2 care providers, or by other states.
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4 When determining which patient charge data to disclose, the
5 agency shall consider such measures as average charge, average
6 net revenue per adjusted patient day, average cost per
7 adjusted patient day, and average cost per admission, among
8 others.
9 2. Make available performance measures, benefit
10 design, and premium cost data from health plans licensed
11 pursuant to chapter 627 or chapter 641. The agency shall
12 determine which performance outcome and member and subscriber
13 cost data to disclose, based upon input from the council. When
14 determining which data to disclose, the agency shall consider
15 information that may be required by either individual or group
16 purchasers to assess the value of the product, which may
17 include membership satisfaction, quality of care, current
18 enrollment or membership, coverage areas, accreditation
19 status, premium costs, plan costs, premium increases, range of
20 benefits, copayments and deductibles, accuracy and speed of
21 claims payment, credentials of physicians, number of
22 providers, names of network providers, and hospitals in the
23 network. Health plans shall make available to the agency any
24 such data or information that is not currently reported to the
25 agency or the office.
26 3. Determine the method and format for public
27 disclosure of data reported pursuant to this paragraph. The
28 agency shall make its determination based upon input from the
29 Comprehensive Health Information System Advisory Council. At a
30 minimum, the data shall be made available on the agency's
31 Internet website in a manner that allows consumers to conduct
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1 an interactive search that allows them to view and compare the
2 information for specific providers. The website must include
3 such additional information as is determined necessary to
4 ensure that the website enhances informed decisionmaking among
5 consumers and health care purchasers, which shall include, at
6 a minimum, appropriate guidance on how to use the data and an
7 explanation of why the data may vary from provider to
8 provider. The data specified in subparagraph 1. shall be
9 released no later than March 1, 2005. The data specified in
10 subparagraph 2. shall be released no later than March 1, 2006.
11 Section 2. Paragraph (b) of subsection (3) of section
12 408.909, Florida Statutes, is amended to read:
13 408.909 Health flex plans.--
14 (3) PROGRAM.--The agency and the office shall each
15 approve or disapprove health flex plans that provide health
16 care coverage for eligible participants. A health flex plan
17 may limit or exclude benefits otherwise required by law for
18 insurers offering coverage in this state, may cap the total
19 amount of claims paid per year per enrollee, may limit the
20 number of enrollees, or may take any combination of those
21 actions. A health flex plan offering may include the option of
22 a catastrophic plan supplementing the health flex plan.
23 (b) The office shall develop guidelines for the review
24 of health flex plan applications and provide regulatory
25 oversight of health flex plan advertisement and marketing
26 procedures. The office shall disapprove or shall withdraw
27 approval of plans that:
28 1. Contain any ambiguous, inconsistent, or misleading
29 provisions or any exceptions or conditions that deceptively
30 affect or limit the benefits purported to be assumed in the
31 general coverage provided by the health flex plan;
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1 2. Provide benefits that are unreasonable in relation
2 to the premium charged or contain provisions that are unfair
3 or inequitable or contrary to the public policy of this state,
4 that encourage misrepresentation, or that result in unfair
5 discrimination in sales practices; or
6 3. Cannot demonstrate that the health flex plan is
7 financially sound and that the applicant is able to underwrite
8 or finance the health care coverage provided; or
9 4. Cannot demonstrate that the applicant and its
10 management are in compliance with the standards required under
11 s. 624.404(3).
12 Section 3. Subsection (6) is added to section 627.413,
13 Florida Statutes, to read:
14 627.413 Contents of policies, in general;
15 identification.--
16 (6) Notwithstanding any other provision of the Florida
17 Insurance Code that is in conflict with federal requirements
18 for a health savings account qualified high-deductible health
19 plan, an insurer, or a health maintenance organization subject
20 to part I of chapter 641, which is authorized to issue health
21 insurance in this state may offer for sale an individual or
22 group policy or contract that provides for a high-deductible
23 plan that meets the federal requirements of a health savings
24 account plan and which is offered in conjunction with a health
25 savings account.
26 Section 4. Paragraph (b) of subsection (3) of section
27 627.6487, Florida Statutes, is amended to read:
28 627.6487 Guaranteed availability of individual health
29 insurance coverage to eligible individuals.--
30 (3) For the purposes of this section, the term
31 "eligible individual" means an individual:
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1 (b) Who is not eligible for coverage under:
2 1. A group health plan, as defined in s. 2791 of the
3 Public Health Service Act;
4 2. A conversion policy or contract issued by an
5 authorized insurer or health maintenance organization under s.
6 627.6675 or s. 641.3921, respectively, offered to an
7 individual who is no longer eligible for coverage under either
8 an insured or self-insured employer plan;
9 3. Part A or part B of Title XVIII of the Social
10 Security Act; or
11 4. A state plan under Title XIX of such act, or any
12 successor program, and does not have other health insurance
13 coverage; or
14 5. The Florida Health Insurance Plan as specified in
15 s. 627.64872 and such plan is accepting new enrollments.
16 However, a person whose previous coverage was under the
17 Florida Health Insurance Plan as specified in s. 627.64872 is
18 not an eligible individual as defined in s. 627.6487(3)(a).
19 Section 5. Paragraphs (b), (c), and (n) of subsection
20 (2) and subsections (3), (6), (9), and (15) of section
21 627.64872, Florida Statutes, are amended, subsection (20) of
22 that section is renumbered as subsection (21), and a new
23 subsection (20) is added to that section, to read:
24 627.64872 Florida Health Insurance Plan.--
25 (2) DEFINITIONS.--As used in this section:
26 (b) "Commissioner" means the Commissioner of Insurance
27 Regulation.
28 (c) "Dependent" means a resident spouse or resident
29 unmarried child under the age of 19 years, a child who is a
30 student under the age of 25 years and who is financially
31 dependent upon the parent, or a child of any age who is
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1 disabled and dependent upon the parent.
2 (c) "Director" means the Director of the Office of
3 Insurance Regulation.
4 (n) "Resident" means an individual who has been
5 legally domiciled in this state for a period of at least 6
6 months and who physically resides in this state not less than
7 185 days per year.
8 (3) BOARD OF DIRECTORS.--
9 (a) The plan shall operate subject to the supervision
10 and control of the board. The board shall consist of the
11 commissioner director or his or her designated representative,
12 who shall serve as a member of the board and shall be its
13 chair, and an additional eight members, five of whom shall be
14 appointed by the Governor, at least two of whom shall be
15 individuals not representative of insurers or health care
16 providers, one of whom shall be appointed by the President of
17 the Senate, one of whom shall be appointed by the Speaker of
18 the House of Representatives, and one of whom shall be
19 appointed by the Chief Financial Officer.
20 (b) The term to be served on the board by the
21 commissioner Director of the Office of Insurance Regulation
22 shall be determined by continued employment in such position.
23 The remaining initial board members shall serve for a period
24 of time as follows: two members appointed by the Governor and
25 the members appointed by the President of the Senate and the
26 Speaker of the House of Representatives shall serve a term of
27 2 years; and three members appointed by the Governor and the
28 Chief Financial Officer shall serve a term of 4 years.
29 Subsequent board members shall serve for a term of 3 years. A
30 board member's term shall continue until his or her successor
31 is appointed.
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1 (c) Vacancies on the board shall be filled by the
2 appointing authority, such authority being the Governor, the
3 President of the Senate, the Speaker of the House of
4 Representatives, or the Chief Financial Officer. The
5 appointing authority may remove board members for cause.
6 (d) The commissioner director, or his or her
7 recognized representative, shall be responsible for any
8 organizational requirements necessary for the initial meeting
9 of the board which shall take place no later than September 1,
10 2004.
11 (e) Members shall not be compensated in their capacity
12 as board members but shall be reimbursed for reasonable
13 expenses incurred in the necessary performance of their duties
14 in accordance with s. 112.061.
15 (f) The board shall submit to the Financial Services
16 Commission a plan of operation for the plan and any amendments
17 thereto necessary or suitable to ensure the fair, reasonable,
18 and equitable administration of the plan. The plan of
19 operation shall ensure that the plan qualifies to apply for
20 any available funding from the Federal Government that adds to
21 the financial viability of the plan. The plan of operation
22 shall become effective upon approval in writing by the
23 Financial Services Commission consistent with the date on
24 which the coverage under this section must be made available.
25 If the board fails to submit a suitable plan of operation
26 within 1 year after implementation the appointment of the
27 board of directors, or at any time thereafter fails to submit
28 suitable amendments to the plan of operation, the Financial
29 Services Commission shall adopt such rules as are necessary or
30 advisable to effectuate the provisions of this section. Such
31 rules shall continue in force until modified by the office or
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1 superseded by a plan of operation submitted by the board and
2 approved by the Financial Services Commission.
3 (6) INTERIM REPORT; ANNUAL REPORT.--
4 (a) By no later than December 1, 2004, the board shall
5 report to the Governor, the President of the Senate, and the
6 Speaker of the House of Representatives the results of an
7 actuarial study conducted by the board to determine,
8 including, but not limited to:
9 1. The impact the creation of the plan will have on
10 the small group insurance market and the individual market on
11 premiums paid by insureds. This shall include an estimate of
12 the total anticipated aggregate savings for all small
13 employers in the state.
14 2. The number of individuals the pool could reasonably
15 cover at various funding levels, specifically, the number of
16 people the pool may cover at each of those funding levels.
17 3. A recommendation as to the best source of funding
18 for the anticipated deficits of the pool.
19 4. The effect on the individual and small group market
20 by including in the Florida Health Insurance Plan persons
21 eligible for coverage under s. 627.6487, as well as the cost
22 of including these individuals.
23
24 The board shall take no action to implement the Florida Health
25 Insurance Plan, other than the completion of the actuarial
26 study authorized in this paragraph, until funds are
27 appropriated for startup cost and any projected deficits.
28 (b) No later than December 1, 2005, and annually
29 thereafter, the board shall submit to the Governor, the
30 President of the Senate, the Speaker of the House of
31 Representatives, and the substantive legislative committees of
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1 the Legislature a report which includes an independent
2 actuarial study to determine, including, but not be limited
3 to:
4 (a)1. The impact the creation of the plan has on the
5 small group and individual insurance market, specifically on
6 the premiums paid by insureds. This shall include an estimate
7 of the total anticipated aggregate savings for all small
8 employers in the state.
9 (b)2. The actual number of individuals covered at the
10 current funding and benefit level, the projected number of
11 individuals that may seek coverage in the forthcoming fiscal
12 year, and the projected funding needed to cover anticipated
13 increase or decrease in plan participation.
14 3. A recommendation as to the best source of funding
15 for the anticipated deficits of the pool.
16 (c)4. A summarization of the activities of the plan in
17 the preceding calendar year, including the net written and
18 earned premiums, plan enrollment, the expense of
19 administration, and the paid and incurred losses.
20 (d)5. A review of the operation of the plan as to
21 whether the plan has met the intent of this section.
22 (9) ELIGIBILITY.--
23 (a) Any individual person who is and continues to be a
24 resident of this state shall be eligible for coverage under
25 the plan if:
26 1. Evidence is provided that the person received
27 notices of rejection or refusal to issue substantially similar
28 coverage for health reasons from at least two health insurers
29 or health maintenance organizations. A rejection or refusal by
30 an insurer offering only stop-loss, excess of loss, or
31 reinsurance coverage with respect to the applicant shall not
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1 be sufficient evidence under this paragraph;.
2 2. The person is enrolled in the Florida Comprehensive
3 Health Association as of the date the plan is implemented; or.
4 3. Is an eligible individual as defined in s.
5 627.6487(3), excluding s. 627.6487(3)(b)5.
6 (b) Each resident dependent of a person who is
7 eligible for coverage under the plan shall also be eligible
8 for such coverage.
9 (c) Except for persons made eligible by paragraph (a),
10 a person shall not be eligible for coverage under the plan if:
11 1. The person has or obtains health insurance coverage
12 substantially similar to or more comprehensive than a plan
13 policy, or would be eligible to obtain such coverage, unless a
14 person may maintain other coverage for the period of time the
15 person is satisfying any preexisting condition waiting period
16 under a plan policy or may maintain plan coverage for the
17 period of time the person is satisfying a preexisting
18 condition waiting period under another health insurance policy
19 intended to replace the plan policy;.
20 2. The person is determined to be eligible for health
21 care benefits under Medicaid, Medicare, the state's children's
22 health insurance program, or any other federal, state, or
23 local government program that provides health benefits;
24 3. The person voluntarily terminated plan coverage
25 unless 12 months have elapsed since such termination;
26 4. The person is an inmate or resident of a public
27 institution; or
28 5. The person's premiums are paid for or reimbursed
29 under any government-sponsored program, or by any government
30 agency or health care provider, or by any organization
31 sponsored by or affiliated with a health care provider.
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1 (d) Coverage shall cease:
2 1. On the date a person is no longer a resident of
3 this state;
4 2. On the date a person requests coverage to end;
5 3. Upon the death of the covered person;
6 4. On the date state law requires cancellation or
7 nonrenewal of the policy; or
8 5. At the option of the plan, 30 days after the plan
9 makes any inquiry concerning the person's eligibility or place
10 of residence to which the person does not reply; or.
11 6. Upon failure of the insured to pay for continued
12 coverage.
13 (e) Except under the circumstances described in this
14 subsection, coverage of a person who ceases to meet the
15 eligibility requirements of this subsection shall be
16 terminated at the end of the policy period for which the
17 necessary premiums have been paid.
18 (15) FUNDING OF THE PLAN.--
19 (a) Premiums.--
20 1. The plan shall establish premium rates for plan
21 coverage as provided in this section. Separate schedules of
22 premium rates based on age, sex, and geographical location may
23 apply for individual risks. Premium rates and schedules shall
24 be submitted to the office for approval prior to use.
25 2. Initial rates for plan coverage shall be limited to
26 no more than 200 percent 300 percent of rates established for
27 individual standard risks as specified in s. 627.6675(3)(c).
28 Subject to the limits provided in this paragraph, subsequent
29 rates shall be established to provide fully for the expected
30 costs of claims, including recovery of prior losses, expenses
31 of operation, investment income of claim reserves, and any
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1 other cost factors subject to the limitations described
2 herein, but in no event shall premiums exceed the 200-percent
3 300-percent rate limitation provided in this section.
4 Notwithstanding the 200-percent 300-percent rate limitation,
5 sliding scale premium surcharges based upon the insured's
6 income may apply to all enrollees, except those made eligible
7 for coverage by paragraph (9)(a).
8 (b) Sources of additional revenue.--Any deficit
9 incurred by the plan shall be primarily funded through amounts
10 appropriated by the Legislature from general revenue sources,
11 including, but not limited to, a portion of the annual growth
12 in existing net insurance premium taxes in an amount not less
13 than the anticipated losses and reserve requirements for
14 existing policyholders. The board shall operate the plan in
15 such a manner that the estimated cost of providing health
16 insurance during any fiscal year will not exceed total income
17 the plan expects to receive from policy premiums and funds
18 appropriated by the Legislature, including any interest on
19 investments. After determining the amount of funds
20 appropriated to the board for a fiscal year, the board shall
21 estimate the number of new policies it believes the plan has
22 the financial capacity to insure during that year so that
23 costs do not exceed income. The board shall take steps
24 necessary to ensure that plan enrollment does not exceed the
25 number of residents it has estimated it has the financial
26 capacity to insure.
27 (c) In the event of inadequate funding, the board may
28 cancel existing policies on a nondiscriminatory basis as
29 necessary to remedy the situation. No policy may be canceled
30 if a covered individual is currently making a claim.
31 (20) PROVIDER REIMBURSEMENT.--Notwithstanding any
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1 other provision of law, the maximum reimbursement rate to
2 health care providers for all covered, medically necessary
3 services shall be 100 percent of Medicare's allowed payment
4 amount for that particular provider and service. All licensed
5 providers in this state shall accept assignment of plan
6 benefits and consider the Medicare allowed payment amount as
7 payment in full.
8 Section 6. Section 627.65626, Florida Statutes, is
9 amended to read:
10 627.65626 Insurance rebates for healthy lifestyles.--
11 (1) Any rate, rating schedule, or rating manual for a
12 health insurance policy that provides credible coverage as
13 defined in s. 627.6561(5) filed with the office shall provide
14 for an appropriate rebate of premiums paid in the last policy
15 calendar year when the majority of members of a health plan
16 have enrolled and maintained participation in any health
17 wellness, maintenance, or improvement program offered by the
18 group policyholder employer. The group employer must provide
19 evidence of demonstrative maintenance or improvement of the
20 enrollees' health status as determined by assessments of
21 agreed-upon health status indicators between the policyholder
22 employer and the health insurer, including, but not limited
23 to, reduction in weight, body mass index, and smoking
24 cessation. Any rebate provided by the health insurer is
25 presumed to be appropriate unless credible data demonstrates
26 otherwise, or unless the rebate program requires the insured
27 to incur costs to qualify for the rebate which equal or
28 exceeds the value of the rebate, but the rebate may shall not
29 exceed 10 percent of paid premiums.
30 (2) The premium rebate authorized by this section
31 shall be effective for an insured on an annual basis unless
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1 the number of participating members on the policy renewal
2 anniversary employees becomes less than the majority of the
3 members employees eligible for participation in the wellness
4 program.
5 Section 7. Paragraphs (d) and (j) of subsection (5) of
6 section 627.6692, Florida Statutes, are amended to read:
7 627.6692 Florida Health Insurance Coverage
8 Continuation Act.--
9 (5) CONTINUATION OF COVERAGE UNDER GROUP HEALTH
10 PLANS.--
11 (d)1. A qualified beneficiary must give written notice
12 to the insurance carrier within 63 30 days after the
13 occurrence of a qualifying event. Unless otherwise specified
14 in the notice, a notice by any qualified beneficiary
15 constitutes notice on behalf of all qualified beneficiaries.
16 The written notice must inform the insurance carrier of the
17 occurrence and type of the qualifying event giving rise to the
18 potential election by a qualified beneficiary of continuation
19 of coverage under the group health plan issued by that
20 insurance carrier, except that in cases where the covered
21 employee has been involuntarily discharged, the nature of such
22 discharge need not be disclosed. The written notice must, at a
23 minimum, identify the employer, the group health plan number,
24 the name and address of all qualified beneficiaries, and such
25 other information required by the insurance carrier under the
26 terms of the group health plan or the commission by rule, to
27 the extent that such information is known by the qualified
28 beneficiary.
29 2. Within 14 days after the receipt of written notice
30 under subparagraph 1., the insurance carrier shall send each
31 qualified beneficiary by certified mail an election and
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1 premium notice form, approved by the office, which form must
2 provide for the qualified beneficiary's election or
3 nonelection of continuation of coverage under the group health
4 plan and the applicable premium amount due after the election
5 to continue coverage. This subparagraph does not require
6 separate mailing of notices to qualified beneficiaries
7 residing in the same household, but requires a separate
8 mailing for each separate household.
9 (j) Notwithstanding paragraph (b), if a qualified
10 beneficiary in the military reserve or National Guard has
11 elected to continue coverage and is thereafter called to
12 active duty and the coverage under the group plan is
13 terminated by the beneficiary or the carrier due to the
14 qualified beneficiary becoming eligible for TRICARE (the
15 health care program provided by the United States Defense
16 Department), the 18-month period or such other applicable
17 maximum time period for which the qualified beneficiary would
18 otherwise be entitled to continue coverage is tolled during
19 the time that he or she is covered under the TRICARE program.
20 Within 63 30 days after the federal TRICARE coverage
21 terminates, the qualified beneficiary may elect to continue
22 coverage under the group health plan, retroactively to the
23 date coverage terminated under TRICARE, for the remainder of
24 the 18-month period or such other applicable time period,
25 subject to termination of coverage at the earliest of the
26 conditions specified in paragraph (b).
27 Section 8. Paragraph (a) of subsection (4), paragraph
28 (c) of subsection (5), and paragraphs (b) and (j) of
29 subsection (11) of section 627.6699, Florida Statutes, are
30 amended, and paragraph (o) is added to subsection (11) of that
31 section, to read:
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1 627.6699 Employee Health Care Access Act.--
2 (4) APPLICABILITY AND SCOPE.--
3 (a)1. This section applies to a health benefit plan
4 that provides coverage to employees of a small employer in
5 this state, unless the coverage policy is marketed directly to
6 the individual employee, and the employer does not contribute
7 directly or indirectly to participate in the collection or
8 distribution of premiums or facilitate the administration of
9 the coverage policy in any manner. For the purposes of this
10 paragraph, an employer is not deemed to be contributing to the
11 premiums or facilitating the administration of coverage if the
12 employer does not contribute to the premium and merely
13 collects the premiums for coverage from an employee's wages or
14 salary through payroll deduction and submits payment for the
15 premiums of one or more employees in a lump sum to a carrier.
16 2. A carrier authorized to issue group or individual
17 health benefit plans under this chapter or chapter 641 may
18 offer coverage as described in this paragraph to individual
19 employees without being subject to this section if the
20 employer has not had a group health benefit plan in place in
21 the prior 12 months. A carrier authorized to issue group or
22 individual health benefit plans under this chapter or chapter
23 641 may offer coverage as described in this paragraph to
24 employees that are not eligible employees as defined in this
25 section, whether or not the small employer has a group health
26 benefit plan in place. A carrier that offers coverage as
27 described in this paragraph must provide a cancellation notice
28 to the primary insured at least 10 days prior to canceling the
29 coverage for nonpayment of premium.
30 (5) AVAILABILITY OF COVERAGE.--
31 (c) Every small employer carrier must, as a condition
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1 of transacting business in this state:
2 1. Offer and issue all small employer health benefit
3 plans on a guaranteed-issue basis to every eligible small
4 employer, with 2 to 50 eligible employees, that elects to be
5 covered under such plan, agrees to make the required premium
6 payments, and satisfies the other provisions of the plan. A
7 rider for additional or increased benefits may be medically
8 underwritten and may only be added to the standard health
9 benefit plan. The increased rate charged for the additional or
10 increased benefit must be rated in accordance with this
11 section.
12 2. In the absence of enrollment availability in the
13 Florida Health Insurance Plan, offer and issue basic and
14 standard small employer health benefit plans and a
15 high-deductible plan that meets the requirements of a health
16 savings account plan or health reimbursement account as
17 defined by federal law, on a guaranteed-issue basis, during a
18 31-day open enrollment period of August 1 through August 31 of
19 each year, to every eligible small employer, with fewer than
20 two eligible employees, which small employer is not formed
21 primarily for the purpose of buying health insurance and which
22 elects to be covered under such plan, agrees to make the
23 required premium payments, and satisfies the other provisions
24 of the plan. Coverage provided under this subparagraph shall
25 begin on October 1 of the same year as the date of enrollment,
26 unless the small employer carrier and the small employer agree
27 to a different date. A rider for additional or increased
28 benefits may be medically underwritten and may only be added
29 to the standard health benefit plan. The increased rate
30 charged for the additional or increased benefit must be rated
31 in accordance with this section. For purposes of this
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1 subparagraph, a person, his or her spouse, and his or her
2 dependent children constitute a single eligible employee if
3 that person and spouse are employed by the same small employer
4 and either that person or his or her spouse has a normal work
5 week of less than 25 hours. Any right to an open enrollment of
6 health benefit coverage for groups of fewer than two
7 employees, pursuant to this section, shall remain in full
8 force and effect in the absence of the availability of new
9 enrollment into the Florida Health Insurance Plan.
10 3. This paragraph does not limit a carrier's ability
11 to offer other health benefit plans to small employers if the
12 standard and basic health benefit plans are offered and
13 rejected.
14 (11) SMALL EMPLOYER HEALTH REINSURANCE PROGRAM.--
15 (b)1. The program shall operate subject to the
16 supervision and control of the board.
17 2. Effective upon this act becoming a law, the board
18 shall consist of the director of the office or his or her
19 designee, who shall serve as the chairperson, and 13
20 additional members who are representatives of carriers and
21 insurance agents and are appointed by the director of the
22 office and serve as follows:
23 a. Five members shall be representatives of health
24 insurers licensed under chapter 624 or chapter 641. Two
25 members shall be agents who are actively engaged in the sale
26 of health insurance. Four members shall be employers or
27 representatives of employers. One member shall be a person
28 covered under an individual health insurance policy issued by
29 a licensed insurer in this state. One member shall represent
30 the Agency for Health Care Administration and shall be
31 recommended by the Secretary of Health Care Administration.
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1 The director of the office shall include representatives of
2 small employer carriers subject to assessment under this
3 subsection. If two or more carriers elect to be risk-assuming
4 carriers, the membership must include at least two
5 representatives of risk-assuming carriers; if one carrier is
6 risk-assuming, one member must be a representative of such
7 carrier. At least one member must be a carrier who is subject
8 to the assessments, but is not a small employer carrier.
9 Subject to such restrictions, at least five members shall be
10 selected from individuals recommended by small employer
11 carriers pursuant to procedures provided by rule of the
12 commission. Three members shall be selected from a list of
13 health insurance carriers that issue individual health
14 insurance policies. At least two of the three members selected
15 must be reinsuring carriers. Two members shall be selected
16 from a list of insurance agents who are actively engaged in
17 the sale of health insurance.
18 b. A member appointed under this subparagraph shall
19 serve a term of 4 years and shall continue in office until the
20 member's successor takes office, except that, in order to
21 provide for staggered terms, the director of the office shall
22 designate two of the initial appointees under this
23 subparagraph to serve terms of 2 years and shall designate
24 three of the initial appointees under this subparagraph to
25 serve terms of 3 years.
26 3. The director of the office may remove a member for
27 cause.
28 4. Vacancies on the board shall be filled in the same
29 manner as the original appointment for the unexpired portion
30 of the term.
31 5. The director of the office may require an entity
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1 that recommends persons for appointment to submit additional
2 lists of recommended appointees.
3 (j)1. Before July March 1 of each calendar year, the
4 board shall determine and report to the office the program net
5 loss for the previous year, including administrative expenses
6 for that year, and the incurred losses for the year, taking
7 into account investment income and other appropriate gains and
8 losses.
9 2. Any net loss for the year shall be recouped by
10 assessment of the carriers, as follows:
11 a. The operating losses of the program shall be
12 assessed in the following order subject to the specified
13 limitations. The first tier of assessments shall be made
14 against reinsuring carriers in an amount which shall not
15 exceed 5 percent of each reinsuring carrier's premiums from
16 health benefit plans covering small employers. If such
17 assessments have been collected and additional moneys are
18 needed, the board shall make a second tier of assessments in
19 an amount which shall not exceed 0.5 percent of each carrier's
20 health benefit plan premiums. Except as provided in paragraph
21 (n), risk-assuming carriers are exempt from all assessments
22 authorized pursuant to this section. The amount paid by a
23 reinsuring carrier for the first tier of assessments shall be
24 credited against any additional assessments made.
25 b. The board shall equitably assess carriers for
26 operating losses of the plan based on market share. The board
27 shall annually assess each carrier a portion of the operating
28 losses of the plan. The first tier of assessments shall be
29 determined by multiplying the operating losses by a fraction,
30 the numerator of which equals the reinsuring carrier's earned
31 premium pertaining to direct writings of small employer health
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1 benefit plans in the state during the calendar year for which
2 the assessment is levied, and the denominator of which equals
3 the total of all such premiums earned by reinsuring carriers
4 in the state during that calendar year. The second tier of
5 assessments shall be based on the premiums that all carriers,
6 except risk-assuming carriers, earned on all health benefit
7 plans written in this state. The board may levy interim
8 assessments against carriers to ensure the financial ability
9 of the plan to cover claims expenses and administrative
10 expenses paid or estimated to be paid in the operation of the
11 plan for the calendar year prior to the association's
12 anticipated receipt of annual assessments for that calendar
13 year. Any interim assessment is due and payable within 30 days
14 after receipt by a carrier of the interim assessment notice.
15 Interim assessment payments shall be credited against the
16 carrier's annual assessment. Health benefit plan premiums and
17 benefits paid by a carrier that are less than an amount
18 determined by the board to justify the cost of collection may
19 not be considered for purposes of determining assessments.
20 c. Subject to the approval of the office, the board
21 shall make an adjustment to the assessment formula for
22 reinsuring carriers that are approved as federally qualified
23 health maintenance organizations by the Secretary of Health
24 and Human Services pursuant to 42 U.S.C. s. 300e(c)(2)(A) to
25 the extent, if any, that restrictions are placed on them that
26 are not imposed on other small employer carriers.
27 3. Before July March 1 of each year, the board shall
28 determine and file with the office an estimate of the
29 assessments needed to fund the losses incurred by the program
30 in the previous calendar year.
31 4. If the board determines that the assessments needed
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1 to fund the losses incurred by the program in the previous
2 calendar year will exceed the amount specified in subparagraph
3 2., the board shall evaluate the operation of the program and
4 report its findings, including any recommendations for changes
5 to the plan of operation, to the office within 180 90 days
6 following the end of the calendar year in which the losses
7 were incurred. The evaluation shall include an estimate of
8 future assessments, the administrative costs of the program,
9 the appropriateness of the premiums charged and the level of
10 carrier retention under the program, and the costs of coverage
11 for small employers. If the board fails to file a report with
12 the office within 180 90 days following the end of the
13 applicable calendar year, the office may evaluate the
14 operations of the program and implement such amendments to the
15 plan of operation the office deems necessary to reduce future
16 losses and assessments.
17 5. If assessments exceed the amount of the actual
18 losses and administrative expenses of the program, the excess
19 shall be held as interest and used by the board to offset
20 future losses or to reduce program premiums. As used in this
21 paragraph, the term "future losses" includes reserves for
22 incurred but not reported claims.
23 6. Each carrier's proportion of the assessment shall
24 be determined annually by the board, based on annual
25 statements and other reports considered necessary by the board
26 and filed by the carriers with the board.
27 7. Provision shall be made in the plan of operation
28 for the imposition of an interest penalty for late payment of
29 an assessment.
30 8. A carrier may seek, from the office, a deferment,
31 in whole or in part, from any assessment made by the board.
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1 The office may defer, in whole or in part, the assessment of a
2 carrier if, in the opinion of the office, the payment of the
3 assessment would place the carrier in a financially impaired
4 condition. If an assessment against a carrier is deferred, in
5 whole or in part, the amount by which the assessment is
6 deferred may be assessed against the other carriers in a
7 manner consistent with the basis for assessment set forth in
8 this section. The carrier receiving such deferment remains
9 liable to the program for the amount deferred and is
10 prohibited from reinsuring any individuals or groups in the
11 program if it fails to pay assessments.
12 (o) The board shall advise the office, the agency, the
13 department, and other executive and legislative entities on
14 health insurance issues. Specifically, the board shall:
15 1. Provide a forum for stakeholders, consisting of
16 insurers, employers, agents, consumers, and regulators, in the
17 private health insurance market in this state.
18 2. Review and recommend strategies to improve the
19 functioning of the health insurance markets in this state with
20 a specific focus on market stability, access, and pricing.
21 3. Make recommendations to the office for legislation
22 addressing health insurance market issues and provide comments
23 on health insurance legislation proposed by the office.
24 4. Meet at least three times each year. One meeting
25 shall be held to hear reports and to secure public comment on
26 the health insurance market, to develop any legislation needed
27 to address health insurance market issues, and to provide
28 comments on health insurance legislation proposed by the
29 office.
30 5. By September 1 each year, issue a report to the
31 office on the state of the health insurance market. The report
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1 shall include recommendations for changes in the health
2 insurance market, results from implementation of previous
3 recommendations, and information on health insurance markets.
4 Section 9. Subsection (1) of section 641.27, Florida
5 Statutes, is amended to read:
6 641.27 Examination by the department.--
7 (1) The office shall examine the affairs,
8 transactions, accounts, business records, and assets of any
9 health maintenance organization as often as it deems it
10 expedient for the protection of the people of this state, but
11 not less frequently than once every 5 3 years. In lieu of
12 making its own financial examination, the office may accept an
13 independent certified public accountant's audit report
14 prepared on a statutory accounting basis consistent with this
15 part. However, except when the medical records are requested
16 and copies furnished pursuant to s. 456.057, medical records
17 of individuals and records of physicians providing service
18 under contract to the health maintenance organization shall
19 not be subject to audit, although they may be subject to
20 subpoena by court order upon a showing of good cause. For the
21 purpose of examinations, the office may administer oaths to
22 and examine the officers and agents of a health maintenance
23 organization concerning its business and affairs. The
24 examination of each health maintenance organization by the
25 office shall be subject to the same terms and conditions as
26 apply to insurers under chapter 624. In no event shall
27 expenses of all examinations exceed a maximum of $50,000
28 $20,000 for any 1-year period. Any rehabilitation,
29 liquidation, conservation, or dissolution of a health
30 maintenance organization shall be conducted under the
31 supervision of the department, which shall have all power with
25
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1 respect thereto granted to it under the laws governing the
2 rehabilitation, liquidation, reorganization, conservation, or
3 dissolution of life insurance companies.
4 Section 10. Subsection (40) of section 641.31, Florida
5 Statutes, is amended to read:
6 641.31 Health maintenance contracts.--
7 (40)(a) Any group rate, rating schedule, or rating
8 manual for a health maintenance organization policy filed with
9 the office shall provide for an appropriate rebate of premiums
10 paid in the last contract calendar year when the majority of
11 members of a health individual covered by such plan have is
12 enrolled in and maintained maintains participation in any
13 health wellness, maintenance, or improvement program offered
14 by the group contract holder approved by the health plan. The
15 group individual must provide evidence of demonstrative
16 maintenance or improvement of the group's his or her health
17 status as determined by assessments of agreed-upon health
18 status indicators between the group individual and the health
19 insurer, including, but not limited to, reduction in weight,
20 body mass index, and smoking cessation. Any rebate provided by
21 the health maintenance organization insurer is presumed to be
22 appropriate unless credible data demonstrates otherwise, or
23 unless the rebate program requires the insured to incur costs
24 to qualify for the rebate which equals or exceeds the value of
25 the rebate but the rebate may shall not exceed 10 percent of
26 paid premiums.
27 (b) The premium rebate authorized by this section
28 shall be effective for a subscriber an insured on an annual
29 basis, unless the number of participating members on the
30 contract renewal anniversary becomes fewer than the majority
31 of the members eligible for participation in the wellness
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1 program individual fails to maintain or improve his or her
2 health status while participating in an approved wellness
3 program, or credible evidence demonstrates that the individual
4 is not participating in the approved wellness program.
5 Section 11. (1) An 11-member high-deductible health
6 insurance plan study group is created, to be composed of:
7 (a) Three representatives of employers offering
8 high-deductible health plans to their employees, one of whom
9 shall be a small employer as defined in s. 627.6699, Florida
10 Statutes, who shall be appointed by the Florida Chamber of
11 Commerce.
12 (b) Three representatives of commercial health plans,
13 to be appointed by the Florida Insurance Council.
14 (c) Three representatives of hospitals, to be
15 appointed by the Florida Hospital Association.
16 (d) The Secretary of the Agency for Health Care
17 Administration, or the secretary's designee, who shall serve
18 as co-chair.
19 (e) The Director of the Office of Insurance
20 Regulation, or the director's designee, who shall serve as
21 co-chair.
22 (2) The study group shall study the following issues
23 related to high-deductible health insurance plans, including,
24 but not limited to, health savings accounts and health
25 reimbursement arrangements:
26 (a) The impact of high deductibles on access to health
27 care services and pharmaceutical benefits.
28 (b) The impact of high deductibles on utilization of
29 health care services and overutilization of health care
30 services.
31 (c) The impact on hospitals' inability to collect
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1 deductibles and copayments.
2 (d) The ability of hospitals and insureds to
3 determine, prior to service delivery, the level of deductible
4 and copayment required of the insured.
5 (e) Methods to assist hospitals and insureds in
6 determining prior to service delivery the status of the
7 insured in meeting annual deductible requirements and any
8 subsequent copayments.
9 (f) Methods to assist hospitals in the collection of
10 deductibles and copayments, including electronic payments.
11 (g) Alternative approaches to the collection of
12 deductibles and copayments when either the extent of patient
13 financial responsibility is unknown in advance or there are no
14 funds electronically available from the patient to pay for the
15 deductible and any associated copayment.
16 (3) The study group shall also study the following
17 issues in addition to those specified in subsection (2):
18 (a) The assignment of benefits attestations and
19 contract provisions that nullify the attestations of insureds.
20 (b) The standardization of insured or subscriber
21 identifications cards.
22 (c) The standardization of claim edits or insuring
23 that claim edits comply with nationally recognized editing
24 guidelines.
25 (4) The study group shall meet by August 1, 2005, and
26 shall submit recommendations to the Governor, the President of
27 the Senate, and the Speaker of the House of Representatives by
28 January 1, 2006.
29 Section 12. Section 627.6402, Florida Statutes, is
30 repealed.
31 Section 13. The sum of $5 million is appropriated from
28
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1 the General Revenue Fund to the Florida Health Insurance Plan
2 for the purposes of implementing the plan.
3 Section 14. This act shall take effect July 1, 2005,
4 and shall apply to all policies or contracts issued or renewed
5 on or after July 1, 2005.
6
7
8 ================ T I T L E A M E N D M E N T ===============
9 And the title is amended as follows:
10 Delete everything before the enacting clause
11
12 and insert:
13 A bill to be entitled
14 An act relating to health insurance; amending
15 s. 408.05, F.S.; changing the due date for a
16 report from the Agency for Health Care
17 Administration regarding the State Center for
18 Health Statistics; amending s. 408.909, F.S.;
19 providing an additional criterion for the
20 Office of Insurance Regulation to disapprove or
21 withdraw approval of health flex plans;
22 amending s. 627.413, F.S.; authorizing insurers
23 and health maintenance organizations to offer
24 policies or contracts providing for a
25 high-deductible plan meeting federal
26 requirements and in conjunction with a health
27 savings account; amending s. 627.6487, F.S.;
28 revising the definition of the term "eligible
29 individual" for purposes of obtaining coverage
30 in the Florida Health Insurance Plan; amending
31 s. 627.64872, F.S.; revising definitions;
29
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1 changing references to the Director of the
2 Office of Insurance Regulation to the
3 Commissioner of Insurance Regulation; deleting
4 obsolete language; providing additional
5 eligibility criteria; reducing premium rate
6 limitations; revising requirements for sources
7 of additional revenue; authorizing the board to
8 cancel policies under inadequate funding
9 conditions; providing a limitation; specifying
10 a maximum provider reimbursement rate;
11 requiring licensed providers to accept
12 assignment of plan benefits and consider
13 certain payments as payments in full; amending
14 s. 627.65626, F.S.; providing insurance rebates
15 for healthy lifestyles; amending s. 627.6692,
16 F.S.; extending a time period within which
17 eligible employees may apply for continuation
18 of coverage; amending s. 627.6699, F.S.;
19 revising standards for determining
20 applicability of the Employee Health Care
21 Access Act; prescribing acts that may be
22 performed by an employer without being
23 considered contributing to premiums or
24 facilitating administration of a policy;
25 authorizing certain carriers to offer coverage
26 to certain employees without being subject to
27 the act under certain circumstances; requiring
28 a carrier who offers such coverage to provide
29 notice to the primary insured prior to
30 cancellation for nonpayment of premium;
31 revising an availability of coverage provision
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1 of the Employee Health Care Access Act;
2 including high-deductible plans meeting federal
3 health savings account plan requirements;
4 revising membership of the board of the small
5 employer health reinsurance program; revising
6 certain reporting dates relating to program
7 losses and assessments; requiring the board to
8 advise executive and legislative entities on
9 health insurance issues; providing
10 requirements; amending s. 641.27, F.S.;
11 increasing the interval at which the office
12 examines health maintenance organizations;
13 deleting authorization for the office to accept
14 an audit report from a certified public
15 accountant in lieu of conducting its own
16 examination; increasing an expense limitation;
17 amending s. 641.31, F.S.; providing for an
18 insurance rebate for members in a health
19 wellness program; providing for the rebate to
20 cease under certain conditions; creating a
21 high-deductible health insurance plan study
22 group; specifying membership; requiring the
23 study group to investigate certain issues
24 relating to high-deductible health insurance
25 plans; requiring the group to meet and submit
26 recommendations to the Governor and
27 Legislature; repealing s. 627.6402, F.S.,
28 relating to authorized insurance rebates for
29 healthy lifestyles; providing application;
30 providing an appropriation; providing an
31 effective date.
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