Report Title:

Group Health Insurance; Small Business

 

Description:

Prohibits group health insurers from imposing certain requirements on employers.  Clarifies the definition of "small employer", when applying the Health Insurance Portability and Accountability Act of 1996 or state law that provides greater health benefits or coverage.

 

THE SENATE

S.B. NO.

978

TWENTY-FOURTH LEGISLATURE, 2007

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to health insurance support for Small businesses.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Section 431:2-201.5, Hawaii Revised Statutes, is amended to read as follows:

     "§431:2-201.5  Conformity to federal law.  (a)  The provisions of Title 42 United States Code section 300gg, et seq., as they relate to group and individual health insurance shall apply to title 24, except:

     (1)  Where state law provides greater health benefits or coverage than Title 42 United States Code section 300gg, et seq., state law shall be applicable; and

     (2)  This section shall not apply to or affect life insurance, endowment, or annuity contracts, or any supplemental contract thereto, described in section 431:10A-101(4).

     (b)  The following definitions shall be used when applying Title 42 United States Code section 300gg, et seq.:

     "Employee" means an employee who works on a full-time basis or a part-time employee with a normal workweek of twenty hours or more.

     "Group health issuer" means all persons offering health insurance coverage to any group or association, but shall not include those persons offering benefits exempted from Title I of the Health Insurance Portability and Accountability Act of 1996, P.L. 104-191 under sections 732(c) and 733(c) of Title I of the Employee Retirement Income Security Act of 1974 and sections 2747 and 2791(c) of the Public Health Service Act.

     "Small employer" means an employer who employs [between one and] no more than fifty employees[.], including sole proprietors or self employed individuals with no employees, without regard to whether the employer is:

     (1)  A specific type of legal entity;

     (2)  Required to provide health care coverage pursuant to               chapter 393; or

     (3)  Required to obtain worker's compensation insurance,            temporary disability insurance, or unemployment                    insurance.

     (c)  All group health issuers shall offer all small group health plans to all small employers whose employees live, work, or reside in the group health issuer's service areas; provided that the commissioner may exempt a group health issuer if the commissioner determines that the group health issuer does not have the capacity to deliver services adequately to enrollees of additional groups given its obligation to existing employer groups.

     (d)  A group health issuer shall be prohibited from imposing any preexisting condition exclusion.

     (e)  A group health issuer shall not impose limits on eligibility for a group health insurance program based upon:

     (1)  The number of hours an employee or self employed person works or the amount of pay received;

     (2)  The age of the employer or employee;

     (3)  Whether the employer is a specific type of legal entity;

     (4)  Whether the employer employs less than five employees;

     (5)  The length of time that the employer has been in business; or

     (6)  The type of business, nature of income, or where the income is earned.

     (f)  A group health issuer shall not require an employer to verify eligibility for a group health insurance program by providing an employer identification number, tax identification number, or tax documents.

     [(e)] (g)  The commissioner may adopt rules to implement, clarify, or conform title 24 to Title 42 United States Code section 300gg, et seq.

     [(f)] (h)  The adoption of the Health Insurance Portability and Accountability Act of 1996, P.L. 104-191, for the purposes of title 24 is not an adoption for any purposes for income taxes under chapter 235.

     [(g)] (i)  The State shall have jurisdiction over any matter that Title 42 United States Code section 300gg, et seq., permits, including jurisdiction over enforcement.

     [(h)] (j)  As used in this section, "small group health plans" means the medical plans currently offered, advertised, or marketed by a group health issuer for small employers."

     SECTION 2.  Section 431:10A-603, Hawaii Revised Statutes, is amended to read as follows:

     "§431:10A-603  Self-employed persons, exemption.  The requirements of this article related to mandated coverages for persons insured under individual accident and health or sickness policies shall not apply to accident and health or sickness policies for self-employed persons in this State; provided that this exemption shall apply only to those portions of the individual accident and health or sickness policies that cover self-employed persons in this State and individuals included in the self-employed person's family coverage."

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on October 1, 2007.

 

INTRODUCED BY:

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