Amendment ASA1-AB416

LRBs0130/1

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1995 - 1996 LEGISLATURE

ASSEMBLY SUBSTITUTE AMENDMENT 1, To 1995 ASSEMBLY BILL 416

May 30, 1995 - Offered by Representative Robson.

AB416-ASA1,1,13 An Act to repeal subchapter I of chapter 635 [precedes 635.01], subchapter II (title) of chapter 635 [precedes 635.20] and 635.26 (1s); to amend 15.735 (1), 111.70 (1) (a), 185.981 (4t), 185.983 (1) (intro.), 185.983 (1g), 600.01 (2) (b), 619.12 (1) (intro.), 619.12 (2) (e) 2. (intro.), 619.12 (2) (e) 2. b., 625.03 (6), 625.12 (2), 625.15 (1), 625.22 (1), 625.22 (4), 628.36 (2) (b) 1., 3. and 5., 631.01 (4), 632.70, 632.76 (2) (a), 632.896 (4), 632.897 (2) (d), 632.897 (9) (c), chapter 635 (title), 635.20 (intro.), 635.20 (10), 635.25 (1) (a) (intro.), 635.25 (1) (b), 635.25 (1m), 635.254 (1), 635.254 (3), 635.28, 635.29, 635.31 and 646.35 (5); to repeal and recreate 635.20 (1c), 635.20 (1m) and 635.20 (13); and to create 20.145 (1) (h), 111.70 (4) (m), 601.424, 628.34 (3) (c), 632.727, 632.745, 632.746, 632.7465, 632.747, 632.748, 632.749 and 632.83 of the statutes; relating to: health insurance market reform, granting rule-making authority and making an appropriation.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB416-ASA1, s. 1 Section 1. 15.735 (1) of the statutes is amended to read:

AB416-ASA1,2,10 15.735 (1) Small employer insurance board. There is created a small employer insurance board which is attached to the office of the commissioner of insurance under s. 15.03. The board shall consist of 11 members. Notwithstanding s. 15.07 (2) (intro.), one member shall be the commissioner of insurance, or his or her designee, who shall be a nonvoting member and who shall serve permanently as chairperson of the board. The other 10 members shall be nominated by the governor, and with the advice and consent of the senate appointed, for 3-year terms. Five members shall represent employers that are eligible to participate in the plan under subch. II of ch. 635, and 5 members shall represent employes of employers that are eligible to participate in the plan under subch. II of ch. 635.

AB416-ASA1, s. 2 Section 2. 20.145 (1) (h) of the statutes is created to read:

AB416-ASA1,2,14 20.145 (1) (h) Risk adjustment mechanism. All moneys received from risk adjustment assessments against health insurers for risk adjustment reimbursements to health insurers under rules promulgated under s. 632.747 (4).

AB416-ASA1, s. 3 Section 3. 111.70 (1) (a) of the statutes is amended to read:

AB416-ASA1,3,11 111.70 (1) (a) "Collective bargaining" means the performance of the mutual obligation of a municipal employer, through its officers and agents, and the representatives of its employes, to meet and confer at reasonable times, in good faith, with the intention of reaching an agreement, or to resolve questions arising under such an agreement, with respect to wages, hours and conditions of employment, and with respect to a requirement of the municipal employer for a municipal employe to perform law enforcement and fire fighting services under s. 61.66, except as provided in sub. (4) (m) and s. 40.81 (3) and except that a municipal employer shall not meet and confer with respect to any proposal to diminish or abridge the rights guaranteed to municipal employes under ch. 164. The duty to bargain, however, does not compel either party to agree to a proposal or require the making of a concession. Collective bargaining includes the reduction of any agreement reached to a written and signed document. The employer shall not be required to bargain on subjects reserved to management and direction of the governmental unit except insofar as the manner of exercise of such functions affects the wages, hours and conditions of employment of the employes. In creating this subchapter the legislature recognizes that the public employer must exercise its powers and responsibilities to act for the government and good order of the municipality, its commercial benefit and the health, safety and welfare of the public to assure orderly operations and functions within its jurisdiction, subject to those rights secured to public employes by the constitutions of this state and of the United States and by this subchapter.

AB416-ASA1, s. 4 Section 4. 111.70 (4) (m) of the statutes is created to read:

AB416-ASA1,3,16 111.70 (4) (m) Health insurance market reform requirements. A municipal employer that is an employer under the definition specified in s. 632.745 (1) (b) 2. is prohibited from bargaining collectively with respect to the health insurance requirements under ss. 632.745 to 632.749.

AB416-ASA1, s. 5 Section 5. 185.981 (4t) of the statutes is amended to read:

AB416-ASA1,3,20 185.981 (4t) A sickness care plan operated by a cooperative association is subject to ss. 252.14, 631.89, 632.72 (2), 632.745 to 632.749, 632.87 (2m), (3), (4) and (5), 632.895 (10) and 632.897 (10) and ch. 155.

AB416-ASA1, s. 6 Section 6. 185.983 (1) (intro.) of the statutes is amended to read:

AB416-ASA1,4,2 185.983 (1) (intro.)  Every such voluntary nonprofit sickness care plan shall be exempt from chs. 600 to 646, with the exception of ss. 601.04, 601.13, 601.31, 601.41, 601.42, 601.43, 601.44, 601.45, 611.67, 619.04, 628.34 (10), 631.89, 631.93, 632.72 (2), 632.745 to 632.749, 632.775, 632.79, 632.795, 632.87 (2m), (3), (4) and (5), 632.895 (5), (9) and (10), 632.896 and 632.897 (10), subch. II of ch. 619 and chs. 609, 630, 635, 645 and 646, but the sponsoring association shall:

AB416-ASA1, s. 7 Section 7. 185.983 (1g) of the statutes is amended to read:

AB416-ASA1,4,7 185.983 (1g) A cooperative association that is a small employer insurer, as defined in s. 635.02 (8) 635.20 (13), is subject to the health insurance mandates, as defined in s. 601.423 (1), to the same extent as any other small employer insurer, as defined in s. 635.02 (8) 635.20 (13).

AB416-ASA1, s. 8 Section 8. 600.01 (2) (b) of the statutes is amended to read:

AB416-ASA1,4,10 600.01 (2) (b) Group or blanket insurance described in sub. (1) (b) 3. and 4. is not exempt from ss. 632.745 to 632.749 or ch. 633 or 635.

AB416-ASA1, s. 9 Section 9. 601.424 of the statutes is created to read:

AB416-ASA1,4,18 601.424 Reports on market reform impact on the health insurance risk-sharing plan. The commissioner shall study the effects of the health insurance market reforms under ss. 632.745 to 632.749 on enrollment under, and other aspects of, the health insurance risk-sharing plan under subch. II of ch. 619. The commissioner shall annually submit a report on the effects and any recommendations to the legislature under s. 13.172 (2) commencing on October 1, 1997.

AB416-ASA1, s. 10 Section 10. 619.12 (1) (intro.) of the statutes is amended to read:

AB416-ASA1,5,2 619.12 (1) (intro.) Except as provided in subs. (1m) and (2) to (3), the board or administering carrier shall certify as eligible a person who is covered by medicare because he or she is disabled under 42 USC 423, a person who submits evidence that he or she has tested positive for the presence of HIV, antigen or nonantigenic products of HIV or an antibody to HIV, and any person who receives and submits any of the following based wholly or partially on medical underwriting considerations within 9 months prior to making application for coverage by the plan:

AB416-ASA1, s. 11 Section 11. 619.12 (2) (e) 2. (intro.) of the statutes is amended to read:

AB416-ASA1,5,6 619.12 (2) (e) 2. (intro.) Subdivision 1 does not apply to a person who is eligible for health care benefits under the small employer health insurance plan under subch. II of ch. 635 if all of the following apply:

AB416-ASA1, s. 12 Section 12. 619.12 (2) (e) 2. b. of the statutes is amended to read:

AB416-ASA1,5,10 619.12 (2) (e) 2. b. The board determines that the coverage under the small employer health insurance plan under subch. II of ch. 635 is not substantially equivalent to or greater than the coverage under the plan.

AB416-ASA1, s. 13 Section 13. 625.03 (6) of the statutes is amended to read:

AB416-ASA1,5,14 625.03 (6) Group and blanket accident and sickness insurance other than credit accident and sickness insurance, except as provided in s. 625.22 with regard to s. 632.746 and any rules promulgated under s. 632.7465.

AB416-ASA1, s. 14 Section 14. 625.12 (2) of the statutes is amended to read:

AB416-ASA1,5,25 625.12 (2) Classification. Risks Subject to s. 632.746 and any rules promulgated under s. 632.7465, risks may be classified in any reasonable way for the establishment of rates and minimum premiums, except that no such classifications may be based on race, color, creed or national origin, and classifications in automobile insurance may not be based on physical condition or developmental disability as defined in s. 51.01 (5). Subject to s. ss. 632.365 and 632.746 and any rules promulgated under s. 632.7465, rates thus produced may be modified for individual risks in accordance with rating plans or schedules that establish reasonable standards for measuring probable variations in hazards, expenses, or both. Rates may also be modified for individual risks under s. 625.13 (2).

AB416-ASA1, s. 15 Section 15. 625.15 (1) of the statutes is amended to read:

AB416-ASA1,6,10 625.15 (1) Rate making. An insurer may itself establish rates and supplementary rate information for one or more market segments based on the factors in s. 625.12 and, subject to s. 632.365 if the rates are for motor vehicle liability insurance, subject to s. 632.365, or s. 632.746 and any rules promulgated under s. 632.7465 if the rates are for health benefit plans, as defined in s. 632.745 (1) (d). In the alternative, the insurer may use rates and supplementary rate information prepared by a rate service organization, with average expense factors determined by the rate service organization or with such modification for its own expense and loss experience as the credibility of that experience allows.

AB416-ASA1, s. 16 Section 16. 625.22 (1) of the statutes is amended to read:

AB416-ASA1,6,15 625.22 (1) Order in event of violation. If the commissioner finds after a hearing that a rate is not in compliance with s. 625.11 or 632.746 or rules promulgated under s. 632.7465, the commissioner shall order that its use be discontinued for any policy issued or renewed after a date specified in the order.

AB416-ASA1, s. 17 Section 17. 625.22 (4) of the statutes is amended to read:

AB416-ASA1,7,2 625.22 (4) Interim rates. Whenever an insurer has no legally effective rates as a result of the commissioner's disapproval of rates or other act, the commissioner shall on request specify interim rates for the insurer that are high enough to protect the interests of all parties, and that comply with s. 632.746 and any rules promulgated under s. 632.7465 if the rates are for health benefit plans, as defined in s. 632.745 (1) (d), and may order that a specified portion of the premiums be placed in an escrow account approved by the commissioner. When new rates become legally effective, the commissioner shall order the escrowed funds or any overcharge in the interim rates to be distributed appropriately, except that refunds to policyholders that are trifling shall not be required.

AB416-ASA1, s. 18 Section 18. 628.34 (3) (c) of the statutes is created to read:

AB416-ASA1,7,5 628.34 (3) (c) Paragraphs (a) and (b) do not apply to coverage under a health benefit plan, as defined in s. 632.745 (1) (d), which is subject to ss. 632.745 to 632.749.

AB416-ASA1, s. 19 Section 19. 628.36 (2) (b) 1., 3. and 5. of the statutes are amended to read:

AB416-ASA1,7,12 628.36 (2) (b) 1. Except for health maintenance organizations, preferred provider plans, limited service health organizations and the small employer health insurance plan under subch. II of ch. 635, no health care plan may prevent any person covered under the plan from choosing freely among providers who have agreed to participate in the plan and abide by its terms, except by requiring the person covered to select primary providers to be used when reasonably possible.

AB416-ASA1,7,17 3. Except as provided in subd. 4., no provider may be denied the opportunity to participate in a health care plan, other than a health maintenance organization, a limited service health organization, a preferred provider plan or the small employer health insurance plan under subch. II of ch. 635, under the terms of the plan.

AB416-ASA1,7,21 5. Except for the small employer health insurance plan under subch. II of ch. 635 to the extent determined by the small employer insurance board under s. 635.23 (1) (b), all health care plans, including health maintenance organizations, limited service health organizations and preferred provider plans are subject to s. 632.87 (3).

AB416-ASA1, s. 20 Section 20. 631.01 (4) of the statutes is amended to read:

AB416-ASA1,8,7 631.01 (4) Group policies and annuities for eleemosynary institutions. This chapter, ch. 632 and the health insurance mandates under ch. 632 that apply to the plan under subch. II of ch. 635 do not apply to group policies or annuities provided on a basis as uniform nationally as state statutes permit to educational, scientific research, religious or charitable institutions organized without profit to any person, for the benefit of employes of such institutions. The commissioner may by order subject such contracts issued by a particular insurer to this chapter, ch. 632 or the health insurance mandates under ch. 632 that apply to the plan under subch. II of ch. 635 or any portion of those provisions upon a finding, after a hearing, that the interests of Wisconsin insureds or creditors or the public of this state so require.

AB416-ASA1, s. 21 Section 21. 632.70 of the statutes is amended to read:

AB416-ASA1,8,12 632.70 Exemption for plan under ch. 635. The health insurance mandates, as defined in s. 601.423 (1), that are provided under this subchapter apply to the small employer health insurance plan under subch. II of ch. 635 only to the extent determined by the small employer insurance board under s. 635.23 (1) (b).