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HOUSE BILL NO. 108
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-THIRD LEGISLATURE - FIRST SESSION
BY REPRESENTATIVE MCCABE
Introduced: 3/13/23
Referred: Health and Social Services, Labor and Commerce
A BILL
FOR AN ACT ENTITLED
1 "An Act relating to a health care insurance policy incentive program; relating to health
2 care services; and providing for an effective date."
3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
4 * Section 1. AS 21.06.110 is amended to read:
5 Sec. 21.06.110. Director's annual report. As early in each calendar year as is
6 reasonably possible, the director shall prepare and deliver an annual report to the
7 commissioner, who shall notify the legislature that the report is available, showing,
8 with respect to the preceding calendar year,
9 (1) a list of the authorized insurers transacting insurance in this state,
10 with a summary of their financial statement as the director considers appropriate;
11 (2) the name of each insurer whose certificate of authority was
12 surrendered, suspended, or revoked during the year and the cause of surrender,
13 suspension, or revocation;
14 (3) the name of each insurer authorized to do business in this state
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1 against which delinquency or similar proceedings were instituted and, if against an
2 insurer domiciled in this state, a concise statement of the facts with respect to each
3 proceeding and its present status;
4 (4) a statement in regard to examination of rating organizations,
5 advisory organizations, joint underwriters, and joint reinsurers as required by
6 AS 21.39.120;
7 (5) the receipts [RECEIPT] and expenses of the division for the year;
8 (6) recommendations of the director as to amendments or
9 supplementation of laws affecting insurance or the office of the director;
10 (7) statistical information regarding health insurance, including the
11 number of individual and group policies sold or terminated in the state; this paragraph
12 does not authorize the director to require an insurer to release proprietary information;
13 (8) the annual percentage of health claims paid in the state that meet
14 [MEETS] the requirements of AS 21.36.495(a) and (d);
15 (9) the total amount of contributions reported and the total amount of
16 credit claimed under AS 21.96.070;
17 (10) the total number of public comments received and the director's
18 efforts, to the extent allowable by law, to improve or maintain public access to
19 information on individual health insurance rate filings before they become effective;
20 [AND]
21 (11) the most recent incentive program report compiled under
22 AS 21.96.260; and
23 (12) other pertinent information and matters the director considers
24 proper.
25 * Sec. 2. AS 21.36.100 is amended to read:
26 Sec. 21.36.100. Rebates. Except as provided in AS 21.96.220 or otherwise
27 expressly provided by law, a person may not knowingly permit or offer to make or
28 make a contract of life insurance, life annuity or health insurance, or agreement under
29 the contract other than as plainly expressed in the contract, or pay, allow, give or offer
30 to pay, allow, or give, directly or indirectly, as inducement to the insurance, or
31 annuity, a rebate of premiums payable on the contract, or a special favor or advantage
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1 in the dividends or other benefits, or paid employment or contract for services of any
2 kind, or any valuable consideration or inducement whatever not specified in the
3 contract; or directly or indirectly give, sell, purchase or offer to agree to give, sell,
4 purchase, or allow as inducement to the insurance or annuity or in connection
5 therewith, whether or not to be specified in the policy or contract, an agreement of any
6 form or nature promising returns, profits, stocks, bonds, or other securities, or interest
7 present or contingent in the contract or as measured by the contract, of an insurance
8 company or other corporation, association, or partnership, or dividends or profits
9 accrued or to accrue under the contract; or offer, promise, or give anything of value
10 that is not specified in the contract.
11 * Sec. 3. AS 21.96 is amended by adding new sections to read:
12 Article 2. Health Care Insurance Policy Incentive Program.
13 Sec. 21.96.210. Access to payment information. A health care insurer that
14 offers a health care insurance policy in the group or individual market shall provide
15 comprehensive comparison guidance by telephone and make available on the Internet
16 website of the insurer a price comparison tool that, to the extent practicable, allows an
17 individual enrolled in or covered under a health care insurance policy to compare the
18 amount of cost sharing that the individual would be responsible for paying under the
19 policy for a specific item or service provided in the same policy year and geographic
20 region by each provider participating in the policy. At a minimum, the health care
21 insurer shall comply with 42 U.S.C. 300gg-114.
22 Sec. 21.96.220. Incentive program. (a) A health care insurer that offers a
23 health care insurance policy in the group or individual market shall develop and
24 implement a program that provides a monetary incentive for a covered person enrolled
25 in a health care insurance policy to elect to receive a covered health care service under
26 the health care insurance policy from a health care provider that charges less than the
27 median contracted rate recognized by the health care insurer for that health care
28 service.
29 (b) A health care insurer that offers a health care insurance policy in the group
30 or individual market shall provide an incentive payment to a covered person as
31 provided in this subsection. An incentive may be calculated as a percentage of the
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1 difference in price as a flat dollar amount or by another reasonable methodology
2 adopted by the director by regulation. Except as provided in (e) of this section, the
3 total amount of incentive payments a health care insurer provides to a covered person
4 in a calendar year under this subsection may not exceed the amount of the covered
5 person's cost sharing in the calendar year by more than five percent. A health care
6 insurer is not required to provide an incentive payment to a covered person if the cost
7 saved by the health care insurer is $200 or less.
8 (c) If a covered person receives coverage under a group health care insurance
9 policy offered by an employer, a health care insurer shall provide the covered person
10 with an incentive as provided in this subsection. Except as provided in this subsection
11 and (e) of this section, the incentive a health care insurer provides the covered person
12 must be at least 33.4 percent of the costs saved by the health care insurer resulting
13 from the covered person's election to receive a health care service from a health care
14 provider that charges less than the median of the contracted rates recognized by the
15 health care insurer for that health care service. Except as provided in (e) of this
16 section, the incentive a health care insurer provides to a covered person in a calendar
17 year under this subsection may not exceed the amount of the covered person's cost
18 sharing in the calendar year. The health care insurer shall provide the employer with at
19 least 33.3 percent of the costs saved by the health care insurer resulting from the
20 covered person's election.
21 (d) If a covered person receives coverage under a health care insurance policy
22 offered in the individual market, a health care insurer shall provide the covered person
23 with an incentive of at least 50 percent of the costs saved by the health care insurer
24 resulting from the covered person's election.
25 (e) For a dental insurance policy or a vision insurance policy, the incentives a
26 health care insurer provides to a covered person in a calendar year may not exceed the
27 amount of the dental benefits or vision benefits provided to the covered person under
28 the dental insurance policy or the vision insurance policy.
29 (f) An incentive payment to a covered person under this section is not
30 (1) a violation of AS 21.36.100; or
31 (2) an administrative expense of the health care insurer for rate
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1 development or rate filing purposes.
2 Sec. 21.96.230. Availability of program; notice. A health care insurer that
3 offers a health care insurance policy in the group or individual market shall make an
4 incentive program under AS 21.96.220 available as a component of a health care
5 insurance policy offered in this state. Annually, at enrollment or renewal, a health care
6 insurer shall provide notice about the availability of the program to a person covered
7 under a health care insurance policy eligible for the program.
8 Sec. 21.96.240. Filing requirements. Before offering an incentive program
9 under AS 21.96.220, a health care insurer that offers a health care insurance policy in
10 the group or individual market shall file a description of the program with the director
11 in the manner determined by the director. The director may review the filing to
12 determine whether the incentive program complies with the requirements of
13 AS 21.96.210 - 21.96.300.
14 Sec. 21.96.250. Out-of-network health care providers. If a covered person
15 participates in an incentive program under AS 21.96.220 and elects to receive a health
16 care service under AS 21.96.220(a) from an out-of-network health care provider that
17 results in a savings for the health care insurer, the health care insurer shall apply the
18 amount paid for the health care service toward the cost sharing owed by the covered
19 person as specified in the applicable health care insurance policy as if the health care
20 services were provided by an in-network health care provider.
21 Sec. 21.96.260. Reporting requirements. (a) A health care insurer shall, at the
22 request of the director, annually provide information to the director relating to an
23 incentive program under AS 21.96.220 for the most recent calendar year that includes
24 (1) the total number of incentive payments;
25 (2) information on the use of the incentive program by category of
26 service;
27 (3) the total amount of incentive payments;
28 (4) the average amount of each incentive payment for each category of
29 service;
30 (5) the total savings achieved below the average price of the health
31 care service in each category of service; and
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1 (6) the total number and percentage of covered persons who
2 participated in the incentive program.
3 (b) The director shall include the information provided under this section in
4 the director's annual report under AS 21.06.110 and shall submit the annual report to
5 the chairs of the committee in each house of the legislature with jurisdiction over labor
6 and commerce.
7 Sec. 21.96.270. Applicability. (a) Except as provided in (b) of this section,
8 AS 21.96.210 - 21.96.300 apply to a health care insurance policy or contract but do
9 not apply to excepted benefits.
10 (b) AS 21.96.210 - 21.96.300 apply to excepted benefits provided under a
11 dental insurance policy or a vision insurance policy.
12 (c) In this section, "excepted benefits" has the meaning given in AS 21.54.160.
13 Sec. 21.96.300. Definitions. In AS 21.96.210 - 21.96.300,
14 (1) "cost sharing" means a deductible, coinsurance, copayment, or
15 similar expense owed by a covered person under the terms of the covered person's
16 health care insurance policy;
17 (2) "health care insurance" has the meaning given in AS 21.12.050;
18 (3) "health care insurer" has the meaning given in AS 21.54.500;
19 (4) "health care provider" has the meaning given in AS 18.23.400(n);
20 (5) "health care service" has the meaning given in AS 18.23.400(n);
21 (6) "policy" has the meaning given in AS 21.97.900.
22 * Sec. 4. AS 29.10.200 is amended by adding a new paragraph to read:
23 (68) AS 29.35.142 (disclosure and reporting of health care services and
24 price information).
25 * Sec. 5. AS 29.35 is amended by adding a new section to read:
26 Sec. 29.35.142. Regulation of disclosure and reporting of health care
27 services and price information. (a) The authority to regulate the disclosure or
28 reporting of price information for health care services by health care providers, health
29 care facilities, or health care insurers is reserved to the state, and, except as
30 specifically provided by statute, a municipality may not enact or enforce an ordinance
31 regulating the disclosure or reporting of price information for health care services by
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1 health care providers, health care facilities, or health care insurers.
2 (b) This section applies to home rule and general law municipalities.
3 (c) In this section,
4 (1) "health care facility" has the meaning given in AS 18.23.400(n);
5 (2) "health care insurer" has the meaning given in AS 21.54.500;
6 (3) "health care provider" has the meaning given in AS 18.23.400(n);
7 (4) "health care service" has the meaning given in AS 18.23.400(n).
8 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to
9 read:
10 DEPARTMENT OF ADMINISTRATION ANALYSIS; REPORT TO
11 LEGISLATURE. The Department of Administration shall analyze whether the state or
12 employees covered by a group health care insurance policy for a participating governmental
13 unit would benefit if a group health care insurance policy obtained or provided under
14 AS 39.30.090 or 39.30.091 were required to comply with the provisions of AS 21.96.210 -
15 21.96.300, added by sec. 3 of this Act. The Department of Administration shall complete the
16 analysis and compile the information into a report to the legislature, submit the report to the
17 senate secretary and chief clerk of the house of representatives before January 31, 2024, and
18 notify the legislature that the report is available.
19 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section to
20 read:
21 TRANSITION: REGULATIONS. The director of the division of insurance may adopt
22 regulations necessary to implement this Act. The regulations take effect under AS 44.62
23 (Administrative Procedure Act), but not before the effective d