Division of the Budget
Landon State Office Building Phone: (785) 296-2436
900 SW Jackson Street, Room 504 larry.campbell@ks.gov
Topeka, KS 66612 Division of the Budget http://budget.kansas.gov
Larry L. Campbell, Director Laura Kelly, Governor


January 28, 2019


The Honorable Jene Vickrey, Chairperson
House Committee on Insurance
Statehouse, Room 276-W
Topeka, Kansas 66612
Dear Representative Vickrey:
SUBJECT: Fiscal Note for HB 2055 by House Committee on Insurance
In accordance with KSA 75-3715a, the following fiscal note concerning HB 2055 is
respectfully submitted to your committee.
HB 2055 would remove “any other qualified trade, merchant, retail, or professional
association or business” from the list of entities that are not subject to the jurisdiction of the
Commissioner of Insurance. The bill would also remove the requirement that an association must
be in existence for at least five calendar years and that an association must have at least five
employees. In addition, the bill would make several technical amendments to current statute.
The Insurance Department indicates that enactment of HB 2055 may result in entities
converting fully-insured health plans to new association health plans. This likely would result in
a decline in premium tax collections because the carriers of fully-insured plans pay a premium tax
of 2.0 percent or 5.77 percent whereas the carriers of association health plans pay a 1.0 percent
premium tax. However, the fiscal effect cannot be estimated as the number of entities that would
convert fully-insured health plans to association health plans is unknown. Any fiscal effect
associated with HB 2055 is not reflected in The FY 2020 Governor’s Budget Report.

Sincerely,

Larry L. Campbell
Director of the Budget

cc: Glenda Haverkamp, Insurance


Statutes affected:
As introduced: 40-2222, 40-2222b, 40-2222a