AB394: Bill Text

LRB-2576/1

PJK:jld:nwn

2007 - 2008 LEGISLATURE

2007 Assembly BILL 394

June 7, 2007 - Introduced by Representatives Nygren, Albers, Ballweg, Bies, Davis, Friske, Gunderson, Hahn, Hines, Hubler, Kerkman, Kestell, F. Lasee, LeMahieu, Mursau, A. Ott, J. Ott, Petrowski, Strachota, Vos and Wood, cosponsored by Senators Harsdorf, Cowles, Darling, Grothman, A. Lasee, Roessler and Schultz. Referred to Committee on Insurance.

AB394,1,4 An Act to amend 149.12 (3) (a), 149.14 (1) (a), 149.14 (2) (a) and 149.14 (2) (c) 1.; and to create 149.12 (3) (br) and 149.14 (2) (d) of the statutes; relating to: providing a health savings account option under the Health Insurance Risk-Sharing Plan.

Analysis by the Legislative Reference Bureau

Under current law, the Health Insurance Risk-Sharing Plan (HIRSP) Authority administers HIRSP, which provides health insurance coverage for persons who are covered under Medicare because they are disabled, persons who have tested positive for human immunodeficiency virus (HIV), persons who have been refused coverage, or coverage at an affordable price, in the private health insurance market because of their mental or physical health condition, and persons (called "eligible individuals" in the statutes) who do not currently have health insurance coverage, but who were covered under certain types of health insurance coverage (creditable coverage) for at least 18 months in the past. HIRSP is funded by premiums paid by covered persons, insurer assessments, and provider payment discounts.

HIRSP provides coverage in individual policies and, because HIRSP does not pay for services that are covered under Medicare, offers different coverage for persons who are eligible for Medicare from the coverage offered for persons who are not eligible for Medicare. Under current law, HIRSP is required to offer at least two different coverage options for persons who are not eligible for Medicare.

This bill requires HIRSP to offer to eligible persons who are not eligible for Medicare an additional option of coverage under a high deductible health plan, as that term is defined under federal law, in conjunction with a health savings account. Under federal law, a high deductible health plan providing individual coverage is one that has an annual deductible of not less than $1,000 and under which the total amount of the annual deductible and other out-of-pocket expenses, excluding the premium, does not exceed $5,000. A health savings account allows an individual to make tax-deductible contributions to the account of up to $2,250 (or higher if the individual is 55 years of age or older) or the amount of the deductible under the high deductible health plan, whichever is less, and withdraw the money from the account tax-free to pay for routine and preventive medical care.

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

AB394, s. 1 Section 1. 149.12 (3) (a) of the statutes is amended to read:

AB394,2,7 149.12 (3) (a) Except as provided in pars. (b) and, (bm), and (br), no person is eligible for coverage under the plan for whom a premium, deductible, or coinsurance amount is paid or reimbursed by a federal, state, county, or municipal government or agency as of the first day of any term for which a premium amount is paid or reimbursed and as of the day after the last day of any term during which a deductible or coinsurance amount is paid or reimbursed.

AB394, s. 2 Section 2. 149.12 (3) (br) of the statutes is created to read:

AB394,2,11 149.12 (3) (br) Persons receiving a federal tax deduction for amounts paid to a health savings account under 26 USC 223 are not ineligible for coverage under the plan by reason of such a tax deduction.

AB394, s. 3 Section 3. 149.14 (1) (a) of the statutes is amended to read:

AB394,3,2 149.14 (1) (a) The Subject to sub. (2) (d), the plan shall offer coverage for each eligible person in an annually renewable policy. If an eligible person is also eligible for Medicare coverage, the plan shall not pay or reimburse any person for expenses paid for by Medicare. If an eligible person is eligible for a type of medical assistance specified in s. 149.12 (2) (f) 2., the plan shall not pay or reimburse the person for expenses paid for by Medical Assistance.

AB394, s. 4 Section 4. 149.14 (2) (a) of the statutes is amended to read:

AB394,3,8 149.14 (2) (a) The Subject to pars. (c) and (d), the plan shall provide every eligible person who is not eligible for Medicare with major medical expense coverage. Major medical expense coverage offered under the plan under this section shall pay an eligible person's covered expenses, subject to deductible, copayment, and coinsurance payments, up to a lifetime limit of $1,000,000 per covered individual.

AB394, s. 5 Section 5. 149.14 (2) (c) 1. of the statutes is amended to read:

AB394,3,13 149.14 (2) (c) 1. In Subject to par. (d), in addition to the coverage under pars. par. (a) and (b), the plan shall offer to all eligible persons who are not eligible for Medicare a choice of coverage, as described in section 2744 (a) (1) (C), P.L. 104-191. Any such choice of coverage shall be major medical expense coverage.

AB394,3,22 (e) An eligible person who is not eligible for Medicare may elect once each year, at the time and according to procedures established by the authority, among the coverages offered under this paragraph and par. pars. (a), (c), and (d). If an eligible person elects new coverage, any preexisting condition exclusion imposed under the new coverage is met to the extent that the eligible person has been previously and continuously covered under the plan. No preexisting condition exclusion may be imposed on an eligible person who elects new coverage if the person was an eligible individual when first covered under the plan and the person remained continuously covered under the plan up to the time of electing the new coverage.

AB394, s. 6 Section 6. 149.14 (2) (d) of the statutes is created to read:

AB394,4,2 149.14 (2) (d) 1. In addition to the coverages under pars. (a) and (c), to the extent allowable under and consistent with federal law, the plan shall offer to eligible persons who are not eligible for Medicare a high deductible health plan, as defined in 26 USC 223 (c) (2), in conjunction with a health savings account option.

AB394,4,5 2. Premium reductions under s. 149.165 and deductible subsidies and prescription drug copayment subsidies under s. 149.14 (5) do not apply to the coverage offered under this paragraph.

AB394,4,6 (End)