H. B. 2806
(By Delegates Kelley and Mezzatesta)
[Introduced February 17, 1999; referred to the
Committee on Finance.]
A BILL to amend and reenact article sixteen-a, chapter five of
the code of West Virginia, one thousand nine hundred
thirty-one, as amended, relating to creating a health
insurance program for small business employers; providing
for administration through the public employees insurance
agency; creating a special revenue fund; defining which
small business employers may participate; authorizing
legislative rules for implementation and administration of
the plan; and directing agency development of a plan for
uninsured West Virginia residents.
Be it enacted by the Legislature of West Virginia:
That article sixteen-a, chapter five of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended and reenacted to read as follows:
ARTICLE 16A. THE WEST VIRGINIA HEALTH CARE INSURANCE ACT.
§5-16A-1. Short title.
This article may be cited as "The West Virginia Small
Business Health Care Insurance Act."
§5-16A-3 2. Insurance plan; purpose; planning; development and
implementation.
(a) On the first day of July, one thousand nine hundred
eighty-nine ninety-nine, a small business health care insurance
plan in the state shall be commenced and administered by the
public employees insurance agency. and the resources available
to it solely through the West Virginia health care insurance fund
with the advice and assistance of the legislative task force on
uncompensated health care and medicaid expenditures The purpose
of the plan shall be is to make available affordable health
insurance available by pooling in a group for health insurance
purposes groups of small businesses to provide for purposes of
purchasing acute and primary health care services to working
citizens of the state and for employees and their dependents and
for West Virginia residents and their dependents. who are
without health insurance benefits offered in connection with
their employment as well as to any citizen who is unable to
obtain health insurance coverage The public employees insurance
agency shall be responsible for the development and implementation of the plan. In so doing, the agency may seek the
advice and assistance of the legislative task force on
uncompensated health care and medicaid expenditures.
(b) The plan is available for any business corporation
maintaining its home office in this state and employing no more
than fifty persons. Any amount paid by an employer as payment
for all or any portion of a premium is subject to adjustment
under the provisions of subsection (c), section six, article
twenty-four, chapter eleven of this code.
§5-16A-
4 3. Funding.
Notwithstanding any other provision of this code to the
contrary, any moneys assessed and collected from small business
employers and nonstate employers and West Virginia residents
shall be deposited into the same special revenue fund that is
used for payment by state agencies.
§5-16A-5 4. Rules; contents.
(a) The public employees insurance agency shall develop and
implement the plan through rules promulgated in accordance with
the provisions of chapter twenty-nine-a of this code. The
legislative task force on uncompensated health care and medicaid
expenditures shall share with the public employees insurance
agency any and all pertinent data, studies, reports, analyses,
research, summaries, information collected, filed or developed now or in the future in order to effect the development and
implementation of the plan contemplated herein. Upon request,
in the planning, development and implementation of the plan the
insurance commissioner and the commissioner of human services
shall cooperate with advice and assistance.
(b) The rules shall provide for the establishment of an
insurance pool for the provision of basic acute and primary
health care insurance coverage with measurable cost containment
provisions to small business employers, and their employees of
small businesses and individuals in this state and their
respective dependents; shall develop a definition for "small
business" which definition shall include that includes nonprofit
organizations and nonprofit corporations having nineteen fifty or
fewer employees; shall permit bids from qualified and licensed
insurance companies or carriers, who may wish to offer plans or
reinsurance for the insurance coverage desired; shall address
incentives for small business participation in the plan, and a
variety of effective cost controls; shall provide for an
appropriate application form for participation and procedures for
application; shall ensure accurate and appropriate marketing of
the health insurance coverage to small businesses throughout the
state; and shall establish criteria for monitoring the
effectiveness of the insurance pool.
(c) The rules shall provide that the plan will be available to small business employers with nineteen employees or less and
to individuals who can demonstrate that they have been without
health insurance coverage for a period of at least six months
prior to enrollment, except that persons who are not eligible for
the COBRA provisions for the unemployed and who can demonstrate
that their lack of health insurance is due to a reduction in
workforce will be eligible. Beginning on the first day of April,
one thousand nine hundred ninety, families that no longer qualify
for AFDC but do qualify for Medicaid under the Family Support Act
of 1988 will be eligible to participate in the program, and the
plan may include a premium for those families.
(d) (c) The rules shall provide that health care provided
pursuant to the plan be through an exclusive provider
organization consisting of acute care hospitals, primary care
centers, clinics, physician groups and physicians. Inpatient
care shall be provided by hospitals at a discounted rate which
will be at or below cost. Primary care and outpatient services
shall be provided on a per capita basis to be negotiated with
providers or provider groups and such payment may be made in
advance of services rendered. A formulary prescription drug
program shall also be included on a near cost basis. Health care
provided outside the exclusive provider organization will
generally not be covered by the plan. Outpatient services shall
include a quality assurance component to ensure that the level of care is adequate and appropriate. Appropriate provisions may be
included to ensure that health care providers participating in
the plan do not realize a financial windfall from such
participation and that subsequent charges reflect the income
received therefrom.
(e) The rules shall provide that benefit design and premium
structures be developed with recommendations from the legislative
task force on uncompensated health care and medicaid
expenditures.
(d) The plan shall provide for differing premium and
benefit structures based upon the enrollee's level of income. To
the extent feasible, the plan will limit enrollment to those
individuals who have incomes at or below two hundred percent of
the federal poverty level. Premium structures may include cost
sharing methods including employer and employee sharing of cost
and a sliding scale based on ability to pay. Provisions shall be
included for a minimum two hundred fifty dollar annual deductible
for inpatient acute care and a lifetime cap of two hundred fifty
thousand dollars, per individual, for all benefits provided under
the plan. The plan may provide for the subsidization of premiums
for employees and individuals whose income is below the federal
poverty rate but above medicaid payment standards. The plan may
include such provisions as are necessary to allow full advantage
to be taken of the provisions of the Family Support Act of 1988.
(f) (e) The plan shall begin with a three-year pilot program
which shall include, at a minimum, two thousand subscribers. The
program will be established in two pilot areas in the state. One
pilot area will be located in an urban area defined as a
metropolitan statistical area and one in a rural area, defined as
a nonmetropolitan statistical area. The plan authorized pursuant
to this section is a pilot plan only, and may be discontinued or
terminated at the end thereof without further liability on behalf
of the state of West Virginia or any small businesses that are
participating.
(g) The rules may provide that medical underwriting will
take place after, rather than prior, to enrollment in the plan,
although all participants will be required to complete a medical
screen. Those who do not pass the medical screen may be able to
participate. Premiums for such individuals may be at a rate
higher than those established for other participants. The cost
of the high risk participants' health care insurance premiums may
be partially subsidized by the health care insurance fund. The
rules shall provide for a schedule of the subsidization, which
shall be based on need, cost and funds available.
(h) The rules shall contain provisions that limit any
assistance provided pursuant to the plan to that which can be
provided within the funds available.
§5-16A-6 5. Legislative report.
The public employees insurance agency with the advice and
assistance of the legislative task force on uncompensated health
care and medicaid expenditures, shall cooperate to will prepare
and submit annual reports to the Legislature before it convenes
in the years, one thousand nine hundred ninety, one thousand nine
hundred ninety-one and one thousand nine hundred ninety-two, with
studies, beginning on the first day of January, two thousand,
which includes findings, conclusions and recommendations,
including any recommendations for legislation, all relating to
the purpose and effect of the health care insurance plan created
herein. Said report shall be in addition to any report prepared
by the legislative task force on uncompensated health care and
medicaid expenditures pursuant to the provisions of article
twenty-nine-c, chapter sixteen of this code.
§5-16A-7 6. Availability of data of bureau of employment
programs.
In furtherance of the purposes of this article, the bureau
of employment programs shall, notwithstanding the provisions of
section eleven, article ten, chapter twenty-one-a of this code,
cooperate to make available to the public employees insurance
agency and the legislative task force on uncompensated health
care and medicaid expenditures such any information as they may
request requested for purposes consistent with this article to identify and facilitate contact with small business employers who
may be eligible for participation in the plan. The provisions of
this section shall be liberally construed by the bureau of
employment programs in order to effectuate the development of the
small business health care insurance plan.
Information thus obtained by the public employees insurance
agency and the legislative task force on uncompensated health
care and medicaid expenditures shall be maintained as strictly
confidential and shall be exempt from disclosure to the public.
§5-16A-8 7. Exemption from state antitrust laws and insurance
laws.
The health care insurance plan and those responsible for
developing and implementing it under the provisions of this
article are exempted from the provisions of section five, article
eighteen, chapter forty-seven of this code and any otherwise
applicable provisions of chapter thirty-three of this code.
§5-16A-9 8. Termination of health care insurance plan.
The health care insurance plan shall be terminated pursuant
to the provisions of article ten, chapter four of this code on
the first day of July, one two thousand nine hundred ninety-two
four, unless continued or reestablished pursuant to the
provisions of that article.
§5-16A-10 9. Misrepresentation by employee or provider; penalty.
Any person who knowingly secures or attempts to secure
benefits payable under this article to which the person is not
entitled, or willfully misrepresents any material fact relating
to any other information requested by the public employees
insurance agency, or who willfully overcharges for services
provided, or who willfully misrepresents the diagnosis or nature
of the service provided, may be found to be overpaid and shall be
civilly liable for any overpayment. In addition to the civil
remedy provided herein, the public employees insurance agency
shall withhold payment of any benefits due to that person until
any overpayment has been recovered or may directly set off, after
holding internal administrative proceedings to assure due
process, any such overcharges or improperly derived payment
against benefits due such person hereunder. Nothing in this
section shall be construed to limit any other remedy or civil or
criminal penalty provided by law.
§5-16A-11 10. Exceptions.
Even though a state agency or various state agencies may
implement this insurance program, the employers and individuals
provided insurance coverage by this article are not entitled to
access to health care providers as presently mandated in article
twenty-nine-d, chapter sixteen of this code.
Health care providers may be given the right to treat
individuals under this plan but shall may not be required to provide health care service to any firm or individual under the
insurance plan provided in this article.
§5-16A-11. Development of plan for unemployed, uninsured West
Virginia residents.
(a) On or before the first day of January, two thousand and
one, the public employees insurance agency shall develop an
insurance plan for uninsured West Virginia residents, regardless
of their employment status, which plan shall be presented to the
governor and Legislature prior to implementation. For purposes
of this section, "uninsured" includes West Virginia residents who
are not eligible for COBRA, have exhausted COBRA benefits or
whose COBRA coverage will cost more than twenty percent of their
family income.
(b) The plan is to include recommendations for eligibility,
enrollment, which may be incremental, benefit limits,
underwriting, and financing. The plan may include
recommendations for the subsidization of premiums for
individuals whose income is below the federal poverty rate but
above medicaid payment standards.
(c) Upon specific direction and appropriation, the plan may
be implemented with a cost-sharing by plan participants and a
subsidization of premiums through appropriations, grants,
donations, and any federal moneys available for uninsured individuals.
NOTE: The purpose of this bill is to allow small business
employers who employ less than fifty persons to purchase health
insurance for their employees and dependants through the PEIA and
to provide health insurance coverage for individual West Virginia
residents. The original section 2 of this article has been
deleted; section 4 has been deleted and completely rewritten; and
the remaining sections have been renumbered.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.