Bills to improve health care, protect consumers, ban the use of credit scoring , streamline the licensing of agents and brokers, and broadening the definition of what’s considered “emergency care” are all on Washington’s Office of the Insurance Commissioner’s (OIC) legislative agenda for 2010.
Following are some of the OIC’s proposals:
Health reform: Regardless of what happens at the federal level, the OIC has proposed a health plan for all Washingtonians that would cover basic preventive care and full protection from catastrophic medical costs over $10,000 a year. Whatever the specifics from Congress, it’s clear that states will play a major role in implementing reform nationally. We’re ready to help.
Credit scoring: The OIC is seeking to prohibit the use of credit history, education and income for rating and underwriting personal insurance. Most insurance companies use credit as a key factor in setting rates. Insurance Commissioner Mike Kreidler believes that this is unfair and inherently discriminatory, especially when families are already struggling due to the recent economic downturn, the OIC said in a statement.
The legislation would still allow discounts for good students and people who complete driver’s training. To view the draft bill, visit http://www.insurance.wa.gov/legislative/oic_agenda/Z-0842.2.pdf.
Joint Underwriting Authority: Concerns about potential flooding below Washington’s Howard Hanson Dam have made it difficult for some businesses to find needed flood coverage in the Green River Valley. The area is a key engine for the state’s economy, which relies on businesses being able to shield themselves from catastrophic risk.
In such cases, one of the most effective tools can be a “joint underwriting association,” or JUA, the OIC said. These are publicly-sponsored, temporary, not-for-profit insurers of last resort, stepping in to provide insurance when certain types of coverage become unavailable on the open market.
Medical malpractice law: In 2006, Washington lawmakers voted to reform health care liability laws. Among the changes are that some people handling medical malpractice claims are required to report some data to the state insurance commissioner. Unfortunately, many of the groups required to report claims data have failed to do so, despite repeated urging by the OIC. Others wait until the last minute to report their data, which leaves little time for the OIC to analyze the data and report to the Legislature. Consequently, the department said it would like to improve compliance by creating penalties for failing to report the claims data.
Conversion coverage: When an employer’s health insurance is canceled, workers have 31 days to take out a replacement — or “conversion” — policy from the employer’s former insurer. Sometimes, however, workers learn about the cancellation too late to qualify for new coverage. When that happens, the employees may be subject to exclusions for pre-existing conditions and other medical underwriting that may make it very difficult or expensive to find meaningful coverage. To avoid that, the OIC wants the law to indicate that the 31-day window begins when the employee is notified that the policy’s been canceled.
Receiverships: Financially troubled insurers can be placed into receivership to try to rehabilitate them or, if necessary, to dissolve the company in a fair and orderly manner. But a question has arisen over whether the participation of the OIC in managing these receiverships renders the receivership a public agency, and thus subject to public disclosure laws. The OIC believes that insurers in receivership should be entitled to the same business confidentiality protections provided to all other companies under state law. Disclosure of the company’s business records could put the company at a great competitive disadvantage, making it less likely that the company could be rehabilitated.
Emergency services: Washington’s insurance law defines “emergency services” as only those provided in a hospital emergency department. The OIC would like to broaden that definition so that other emergency care would be included in that definition.
Licensing: Washington law currently requires out-of-state agents and brokers to submit fingerprints and maintain bonds here. They typically already have to do the same thing in their home states. To streamline the process, and for the sake of interstate reciprocity in licensing, the OIC would like to eliminate Washington’s fingerprinting and bonding requirements for out of state agents and brokers.
Technical changes and corrections: The OIC is proposing some changes to streamline administrative procedures and fix some technical errors in the state’s insurance laws.
For more information on the OIC’s legislative agenda for 2010, visit http://www.insurance.wa.gov/legislative/index.shtml.
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