2005 - 2006 LEGISLATURE
January 23, 2006 - Introduced by Senators Harsdorf, Cowles, Darling, Decker,
Erpenbach, Hansen, Leibham, Miller, Risser and Roessler, cosponsored by
Representatives Gielow, Davis, Ott, Nelson, Ainsworth, Albers, Freese,
Friske, Gronemus, Gunderson, Hahn, Hines, Hubler, Hundertmark,
Jeskewitz, Kaufert, Krawczyk, Kreibich, Loeffelholz, Montgomery,
Musser, Nischke, Pettis, Staskunas, Suder, Van Roy, Vos, Vruwink, Gard,
Towns and Moulton. Referred to Committee on Agriculture and Insurance.
SB517,1,4
1An Act to renumber 635.02 (7);
to amend 185.99 (2) (b), 185.99 (2) (c) 2., 185.99
2(4) (a) (intro.) and 185.99 (4) (b); and
to create 185.99 (4) (c) and 635.02 (7) (b)
3of the statutes;
relating to: group health care plans offered by health benefit
4purchasing cooperatives.
Analysis by the Legislative Reference Bureau
Under current law, nonstock health benefit purchasing cooperatives
(cooperative) may be organized in geographic areas of the state designated by the
Commissioner of Insurance by order. The purpose of the cooperatives is to provide
health care benefits to the employees, members, and officers of the members of each
cooperative and to their dependents. Each cooperative may establish membership
criteria, but membership in a cooperative is generally open to any business entity,
trade or labor organization, municipality, or self-employed individual doing
business in, or residing in, the designated geographic area of the cooperative.
Current law provides that each cooperative must be designed so that all members
purchase their health care benefits from the same insurer. Each cooperative must
negotiate the benefits, and enter into a three-year contract, with the insurer that
will provide the health care benefits.
This bill clarifies that the health care benefits provided by a cooperative must
be provided in a single group health care policy or plan; that the contract under which
the benefits are provided is between the cooperative and the insurer, rather than
between the individual members and the insurer; and that the cooperative
employees and members and their dependents receive their health care benefits as
a single group under the group health care policy or plan.
Also under current law, a small employer, for purposes of insurance coverage
under group health benefit plans, is generally defined as an employer with between
2 and 50 employees. An insurer that offers group health benefit plans to one or more
small employers in the state is defined as a small employer insurer. With respect to
group health benefit plans offered and sold to small employers, small employer
insurers are subject to certain marketing standards, certain restrictions on premium
rates that may be charged, and certain requirements to accept for coverage any small
employer in the state that applies for coverage. This bill provides that: 1) any
cooperative that provides health care benefits for more than 50 individuals who are
members or employees of members, and any member of such a cooperative, is not a
small employer for purposes of the insurance requirements related to group health
benefit plans offered and sold to small employers; and 2) any insurer that contracts
with a cooperative that provides health care benefits for more than 50 individuals
who are members or employees of one or more members is not a small employer
insurer with respect to the contract with that cooperative.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB517, s. 1
1Section
1. 185.99 (2) (b) of the statutes is amended to read:
SB517,2,62
185.99
(2) (b) The purpose of a health benefit purchasing cooperative is to
3provide health care benefits for the individuals specified in sub. (4) (a) 1. to 3.,
under
4a single group health care policy or plan through a contract
with between the health
5benefit purchasing cooperative and an insurer authorized to do business in this state
6in one or more lines of insurance that includes health insurance.
SB517, s. 2
7Section
2. 185.99 (2) (c) 2. of the statutes is amended to read:
SB517,2,108
185.99
(2) (c) 2. All members
purchase
receive their health care benefits
from
9the same insurer under the group health care policy or plan negotiated under sub.
10(4) (a).
SB517, s. 3
11Section
3. 185.99 (4) (a) (intro.) of the statutes is amended to read:
SB517,3,312
185.99
(4) (a) (intro.) The health care benefits offered by a health benefit
13purchasing cooperative shall be negotiated between the health benefit purchasing
1cooperative and the insurer
and shall be offered in a single group health care policy
2or plan. The insurer must offer coverage
under the group health care policy or plan 3to all of the following:
SB517, s. 4
4Section
4. 185.99 (4) (b) of the statutes is amended to read:
SB517,3,145
185.99
(4) (b) The contract between the
members of a health benefit
6purchasing cooperative and an insurer shall be for a term of 3 years. Upon
7enrollment in the insurer's
group health
benefit care policy or plan, each member
8shall pay to the health benefit purchasing cooperative an amount determined by the
9health benefit purchasing cooperative that is not less than the member's applicable
10premium for the 36th month of coverage under the contract. If a member withdraws
11from the health benefit purchasing cooperative before the end of the contract term,
12the health benefit purchasing cooperative may retain, as a penalty, an amount
13specified by the health benefit purchasing cooperative that is not less than the
14premium that the member paid for the 36th month of coverage.
SB517, s. 5
15Section
5. 185.99 (4) (c) of the statutes is created to read:
SB517,3,2016
185.99
(4) (c) An insurer that contracts under this section with a health benefit
17purchasing cooperative that provides health care benefits for more than 50
18individuals who are members or employees of one or more members is not a small
19employer insurer, as defined in s. 635.02 (8), with respect to the contract between the
20insurer and the health benefit purchasing cooperative.
SB517, s. 6
21Section
6. 635.02 (7) of the statutes is renumbered 635.02 (7) (a).
SB517, s. 7
22Section
7. 635.02 (7) (b) of the statutes is created to read:
SB517,3,2423
635.02
(7) (b) Notwithstanding par. (a), "small employer" does not include any
24of the following:
SB517,4,3
11. A health benefit purchasing cooperative under s. 185.99 that provides health
2care benefits for more than 50 individuals who are members or employees of one or
3more members.
SB517,4,44
2. A member of a cooperative specified in subd. 1.