(5) The institution business office shall disburse release account funds in accordance with s.
DOC 309.48.
SECTION 3. DOC 309.48 (title) is amended to read:
DOC 309.48 Procedure for inmate requests for disbursements of general inmate account funds.
SECTION 4. DOC 309.49 (title) is amended to read:
DOC 309.49 (title) Disbursement of general inmate account funds.
SECTION 5. DOC 309.49 (4m) is created to read:
DOC 309.49 (4m) An inmate may request that the institution business office disburse release account funds. The institution business office shall disburse release account funds only for reasons consistent with the purposes under s.
DOC 309.466 or subject to a lawful court order.
Small Business Impact
The Department of Corrections has determined that the rule will not have a significant economic impact on a substantial number of small businesses since the rule does not regulate small businesses as that term is defined in s.
227.114, Stats.
Fiscal Estimate
Summary
Under the current administrative rule for inmate release accounts an inmate is required to deposit 15% of their earned or received income (received income is from a personal source) up to a maximum of $500. The Department uses a declining balance approach for all outstanding debt based on the order deductions are to be applied and the percentage used. However, if an inmate has a FIFO (first in/first out) noted on his or her account, those debts must be met prior to any other outstanding obligations, including an inmate's release account. FIFO covers over draft payments, institution loans, medical co-payments, and victim witness obligations. Also, inmates that receive income from a personal source are not always obligated to pay outstanding debt with these funds. In some court cases a judge orders that income received from a personal source cannot be used towards outstanding debt. If that happens, the inmate receives these funds in full without any deductions applied.
The new administrative rule reduces the required deduction from 15% to 10% and increases the maximum amount from $500 to $5,000. The new rule also expands what an inmate can request out of his or her release account prior to release. Currently an inmate can only request funds for street clothing and out-of-state travel. Under this rule an inmate will be able to request funds prior to release to be used for re-entry purposes into the community as well as reimbursement costs related to incarceration, such as legal loans or restitution. The release of these funds must be authorized by the Department; otherwise the funds will be distributed upon release from prison.
The new rule also provides an adjustment to the maximum savings every five years based on the consumer price index percentage. The consumer price index increase should increase the total amount an inmate can save into their release account.
Based on Department inmate release collection data from FY07-09 (3-years) an average of $210.65 was saved per inmate during that time period. The proposal reduces the savings percentage from 15% to 10% of an inmate's earned or received income .The result of this change would be reduced savings by ($10.53) or $200.12 per inmate over a three year period. Based on the new average savings amount it would take an inmate 75 years to accumulate $5,000. Currently, it takes 7 years of incarceration to reach $500.
The procedural changes are not expected to have any state fiscal impact.
State fiscal effect
None.
Local government fiscal effect
None.
Agency Contact Person
Kathryn R. Anderson, Chief Legal Counsel
Department of Corrections
3099 East Washington Avenue, P.O. Box 7925
Madison, WI 53707-7925
Phone: (608) 240-5049; FAX (608) 240-3306
Notice of Hearing
Insurance
NOTICE IS HEREBY GIVEN that pursuant to the authority granted under s.
601.41 (3), Stats., and the procedures set forth in under s.
227.18, Stats. The Office of the Commissioner of Insurance (OCI) will hold a public hearing to consider the adoption of a proposed rule revising section
Ins 3.39, Wis. Adm. Code, relating to guarantee issue and affecting small business.
Hearing Information
Date: October 15, 2009
Time: 10:00 a.m., or as soon thereafter as the matter
may be reached
Place: OCI, Room 227
125 South Webster St. — 2nd Floor
Madison, WI
Submission of Written Comments
Written comments can be mailed to:
Julie E. Walsh
Legal Unit - OCI Rule Comment for Rule Ins 33934
Office of the Commissioner of Insurance
PO Box 7873
Madison WI 53707-7873
Written comments can be hand delivered to:
Julie E. Walsh
Legal Unit - OCI Rule Comment for Rule Ins 33934
Office of the Commissioner of Insurance
125 South Webster St – 2nd Floor
Madison WI 53703-3474
Comments can be emailed to:
Julie E. Walsh
Comments submitted through the Wisconsin Administrative Rule Web site at: http://adminrules. wisconsin.gov on the proposed rule will be considered.
The deadline for submitting comments is 4:00 p.m. on the 7th day after the date for the hearing stated in this Notice of Hearing.
Agency Contact Person and Copies of Proposed Rule
A copy of the full text of the proposed rule changes, analysis and fiscal estimate may be obtained from the OCI internet Web site at
http://oci.wi.gov/ocirules.htm or by contacting Inger Williams, Public Information and Communications, OCI, at:
inger.williams@wisconsin.gov, (608) 264-8110, 125 South Webster Street — 2
nd Floor, Madison WI or PO Box 7873, Madison WI 53707-7873.
Analysis Prepared by the Office of the Commissioner of Insurance (OCI)
Statutes interpreted
ss.
185.983 (1m),
600.03,
601.01 (2),
609.01 (1g) (b),
625.16,
628.34 (12),
628.38,
631.20 (2),
632.73 (2m),
632.76 (2) (b) and
632.81,
632.895 (6) and
(9), Wis. Stats.
Statutory authority
Explanation of agency authority
The statutes all relate to the commissioner's authority to promulgate rules regulating the business of insurance as it relates to Medicare supplement and Medicare replacement insurance products. Specifically, ss.
601.41,
625.16,
628.38,
632.73,
632.76, and
632.81, Wis. Stats., permit the commissioner to promulgate rules regulating various aspects of Medicare supplement and Medicare replacement products while s.
628.34, Wis. Stats., authorizes the commissioner to promulgate rules governing disclosure requirements and unfair marketing practices for disability policies, which includes Medicare supplement and Medicare replacement products.
Related statutes or rules
The Centers for Medicare & Medicaid Services (CMS) required the National Association of Insurance Commissioners (NAIC) to make conforming changes to the Medigap model regulation and delegated the function of implementing the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA, Public Law 110-175) to NAIC. CMS delegates enforcement of MIPPA and the underlying Medicare supplement and Medicare replacement insurance products to the states that have incorporated the NAIC Model Act into the state's insurance regulations. To date Wisconsin has passed several NAIC Model Acts through statute including the most recent modification to the NAIC Medigap Model. In Wisconsin Medicare supplement and Medicare replacement products are currently regulated through s.
Ins 3.39, Wis. Adm. Code, inclusive of the appendices. The proposed rule modifies and adds to s.
Ins 3.39, Wis. Adm. Code in order to comply with the MIPPA and the NAIC requirements, to the extent necessary, and updates the appendices to reflect those changes.
Plain language analysis and summary of the proposed rule
The proposed rule amends portions of the rule to more closely reflect the benefits provided by the NAIC Medicare Supplement Insurance Minimum Standards Model Act and reintroduces the use of high deductible Medicare supplement plans. Further, during prior rule-making the Board on Aging and Long-term Care requested broadening of the guarantee issue eligibility rights. The commissioner convened an advisory work group to assist in the review of existing guarantee issue rights and to determine whether revisions were warranted. The proposed rule includes two modifications to Ins. 3.39, Wis. Adm. Code, that arose from the recommendation of the advisory work group specific to guarantee issue rights.
Regarding modifications clarifying NAIC Model regulations relating to the two new plans that should lower premiums by requiring insureds to pay either 50% of hospital inpatient charges or copayments for office and emergency room visits. The proposed rule limits availability combinations of riders that can be used with the newer benefits as certain combinations would make any premium savings illusory. Specifically, issuers cannot issue both the Medicare Part A Deductible Rider and the Medicare 50% Part A Deductible Rider to the same insured for the same period of coverage. Similarly, issuers cannot issue both the Medicare Part B Deductible Rider and the Medicare Part B Copayments or Coinsurance Rider to the same insured for the same period of coverage.
The proposed rule further delineates that the Medicare Part B Copayment or Coinsurance Rider requires that the insured's copayment or coinsurance be the lesser of $20.00 per office visit or the Medicare Part B coinsurance amount, with emergency room visits covered at the lesser of $50.00 or the Medicare Part B coinsurance amount. The emergency room copayment or coinsurance amount shall be waived if the insured is admitted to any hospital and the emergency visit is subsequently covered as a Medicare Part A expense.
In addition to corrections, the proposed rule reintroduces the high-deductible Medicare supplement plan previously sunset. The reintroduction is in response to repeated requests from the industry and supported by the Board on Aging and Long-term Care. This permits insureds flexibility to purchase a product best suited to medical and financial needs. The product complies with the NAIC Model regulation is proposed to have policy effective on June 1, 2010 to permit issuers time to develop and have policy forms and advertising material approved by the office. The proposed rule also modified Appendix 3 to reflect these changes.
The annual high deductible shall be $1,900.00 for 2010, and will be adjusted annually thereafter to reflect changes in the Consumer Price Index in the twelve-month period ending with August of the preceding year, rounded to the nearest multiple of $10.00. The annual high deductible consists of out-of-pocket expenses, other than premiums, listed above and is in addition to any other specific benefit deductibles. An issuer must continue to make available for purchase any policy form or certificate form issued after May 31, 2010 that has been approved by the commissioner. A policy or certificate form will not be considered to by available for purchase unless the issuer actively offered it for sale within the previous twelve months. This is changed from an issue date of August 1, 1992.
Finally, the proposed rule also expands the category of eligible persons who are guaranteed issuance of Medicare supplements or Medicare replacement policies to those whose payments for coverage substantially increase or to those whose plans terminate or cease to provide some or all such supplemental health benefits. The amount an individual pays for coverage under the plan is considered to substantially increase if the amount the individual pays for coverage under the plan increases by more than 25% from one 12-month period to the subsequent 12-month period, and the new payment for the employer-sponsored coverage is greater than the premium charged under the Medicare supplement plan for which the individual is applying. An issuer may require reasonable documentation to substantiate the increase of the cost of the coverage to the individual.
A second new guaranteed issue time period will arise when a hospitals leaves a Medicare Select network. The issuer shall notify the insured that a hospital is leaving the Medicare Select network and that there is no other hospital within a 30-minute or 30-mile radius of the policyholder. This will trigger a guarantee issue opportunity for the insured affected by the change in network to purchase a new Medicare supplemental policy without being newly underwritten by the issuer.
Comparison with federal regulations
The proposed rule amendments will bring the rule in closer compliance with the NAIC Model Act. There are no existing or proposed federal regulations relating to the proposed changes in guarantee issue eligibility.
Comparison of similar rules in adjacent states
Illinois
Illinois has adopted the NAIC Model regulation creating the new Medigap plans M and N, and to incorporate the hospice care benefit as well as the new and innovative benefit requirements as required by MIPPA. No other state has the guarantee issue provisions as revised or access requirements.
Iowa
Iowa makes available to its Medicare beneficiaries Medigap policies A through J as required by the Medicare reform provisions under OBRA 1990 and the prior NAIC Model Regulation. Iowa has adopted the NAIC Model regulation as required. No other state has the guarantee issue provisions as revised or access requirements.
Michigan
Michigan makes available to its Medicare beneficiaries Medigap policies A through J as required by the Medicare reform provisions under OBRA 1990 and the prior NAIC Model Regulation. Michigan has not yet passed legislation to create new Medigap plans M and N, and to incorporate the hospice care benefit as well as the new and innovative benefit requirements as required by MIPPA. No other state has the guarantee issue provisions as revised or access requirements.
Minnesota
Minnesota, like Wisconsin, received a waiver from the federal standardization regulations. Minnesota makes available to its Medicare beneficiaries two standardized policies (basic and extended basic). Minnesota has adopted the GINA requirements of the NAIC Model regulation but as a waived state will not promulgate the MIPPA changes. No other state has the guarantee issue provisions as revised or access requirements.
Summary of factual data and analytical methodologies
CMS data indicate that Medicare currently covers 40 million Americans, 814,183 of whom are Wisconsin residents as of 2004. An estimated 27 percent of Medicare beneficiaries are covered by Medigap policies.
Information collected by the OCI indicates that 75 insurance companies offer Medicare supplement, Medicare cost and Medicare select (Medigap) policies to Wisconsin consumers eligible for Medicare due to age or disability. In addition, there are 25 insurance companies that have Medigap policyholders although the companies no longer market Medigap coverage in Wisconsin. At year end 2007, there were 247,142 Wisconsin Medicare beneficiaries with Medigap policies. The majority of these Wisconsin Medicare beneficiaries have Medigap policies that will be affected by the Medigap reforms under the MIPPA.
A 2000 report by CMS, Office of Research, Development, and Information, based on 2007 Medicare data indicates that Medicare paid 54-56% of the health care expenses of persons 65 or over, and private health insurance, including Medicare supplement policies paid 16% of these health care expenses. The report indicated that overall annual medical expenses in 2005 per Medicare beneficiary equaled $6,697.
Analysis and supporting documents used to determine rule's effect on small businesses
OCI reviewed financial statements and other reports filed by life, accident and health issuers and determined that none qualifies as a small business. Wisconsin currently has 75 insurance companies offering Medicare supplement, Medicare cost and Medicare select insurance plans. None of these issuers meets the definition of a small business under s.
227.114, Wis. Stats.
