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HOUSE BILL NO. 47
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-THIRD LEGISLATURE - FIRST SESSION
BY REPRESENTATIVE MCCABE
Introduced: 1/25/23
Referred: Health and Social Services, Labor and Commerce
A BILL
FOR AN ACT ENTITLED
"An Act relating to insurance; relating to direct health care agreements; and relating to 1
unfair trade practices." 2
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 3
* Section 1. AS 21.03 is amended by adding a new section to read: 4
Sec. 21.03.025. Direct health care agreements. (a) A direct health care 5
agreement is a written agreement between a health care provider or health care 6
business and a patient or the representative of a patient to provide health care services 7
in exchange for payment of a periodic fee. A patient is not eligible to enter into a 8
direct health care agreement under this section if the patient is eligible to receive 9
assistance under AS 47.07 (Medical Assistance for Needy Persons) or AS 47.08 10
(Assistance for Catastrophic Illness and Chronic or Acute Medical Conditions). 11
(b) A direct health care agreement must 12
(1) describe the health care services that the health care provider or 13
health care business makes available to the patient in exchange for payment of a 14 33-LS0324\A
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periodic fee and each location at which the health care services are available; 1
(2) specify 2
(A) the amount of the periodic fee a patient or the 3
representative of a patient pays in exchange for the health care services that the 4
health care provider or health care business makes available to the patient; 5
(B) the period covered by the periodic fee under (A) of this 6
paragraph; and 7
(C) additional fees that the health care provider or health care 8
business may charge in addition to the periodic fee, including cancellation 9
fees; 10
(3) identify and include contact information for a representative of the 11
health care provider or health care business that is responsible for receiving and 12
addressing a complaint made by a patient relating to the agreement; 13
(4) prominently state that the agreement is not health insurance and 14
does not meet an individual or other health insurance mandate that may be required by 15
federal law; and 16
(5) prominently state that the patient is not entitled to the protections 17
under AS 21.07 (Patient Protections Under Health Care Insurance Policies) or 18
AS 21.36 (Trade Practices and Frauds). 19
(c) A direct health care agreement must allow a patient or the representative of 20
a patient to terminate the agreement in writing within 30 days after entering into the 21
agreement. If a patient or representative terminates an agreement under this 22
subsection, the health care provider or health care business shall, not later than 30 days 23
after the patient or representative terminates the agreement, refund to the patient or 24
representative payments made under the agreement, less payments made for services 25
the health care provider or health care business has already performed that are not 26
included in the periodic fee. The health care provider or health care business may 27
charge a termination fee for termination of an agreement under this subsection, not to 28
exceed an amount equal to one month's cost of the periodic fee. 29
(d) A direct health care agreement must allow a health care provider, a health 30
care business, a patient, or the representative of a patient to terminate the agreement in 31 33-LS0324\A
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writing after at least 30 days' notice. The agreement must require that the patient pay 1
the health care provider or health care business the periodic fee, prorated through the 2
date of termination of the agreement, and that the patient pay any additional fees for 3
services the health care provider or health care business has already performed that are 4
not included in the periodic fee. The health care provider or health care business may 5
charge a termination fee for termination of an agreement under this subsection by a 6
patient or representative, not to exceed an amount equal to one month's cost of the 7
periodic fee. 8
(e) A health care provider or health care business may not change the periodic 9
fee under the agreement more than once a year and shall provide at least 45 days' 10
written notice of a change in the periodic fee. 11
(f) A health care provider or health care business may bill a patient or the 12
representative of a patient for the periodic fee only after the end of the period to which 13
the periodic fee applies. 14
(g) A patient's employer may pay the periodic fee and additional fees the 15
patient owes a health care provider or health care business under a direct health care 16
agreement. A payment by the employer under this subsection does not constitute 17
engaging in the business of insurance or underwriting in this state, and the employer is 18
not an insurer, a health maintenance organization, a health care insurer, or a medical 19
service corporation by virtue of the payment. 20
(h) A health care provider or health care business may immediately terminate 21
a direct health care agreement if 22
(1) a patient repeatedly fails to comply with the treatment plan for the 23
patient recommended by the health care provider or health care business; 24
(2) a patient's behavior threatens the safety of the health care provider, 25
the staff of the health care provider or health care business, or other patients of the 26
health care provider or health care business; or 27
(3) a patient engages in disrespectful, derogatory, or prejudiced 28
behavior that is within the patient's control and the patient does not stop the behavior 29
even after the health care provider or the staff of the health care provider or health care 30
business requests the patient to stop the behavior. 31 33-LS0324\A
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(i) A health care provider or a health care business may immediately terminate 1
a direct health care agreement if a patient or the representative of a patient breaches 2
the terms of the agreement. A patient or representative may immediately terminate a 3
direct health care agreement if a health care provider or a health care business 4
breaches the terms of the agreement. 5
(j) A direct health care agreement and health care services provided under a 6
direct health care agreement are not subject to AS 21.07 (Patient Protections Under 7
Health Care Insurance Policies) or AS 21.36 (Trade Practices and Frauds), but are 8
subject to other consumer protection statutes and regulations, including AS 45.45.915. 9
(k) Offering or executing a direct health care agreement does not constitute 10
engaging in the business of insurance or underwriting in this state, and, except as 11
provided in this section, a direct health care agreement and health care services 12
provided under a direct health care agreement are exempt from regulation by the 13
division under this title. A direct health care agreement is not insurance, health 14
insurance, health care insurance, or a health care insurance policy. A health care 15
provider or health care business is not an insurer, a health maintenance organization, a 16
health care insurer, or a medical service corporation by virtue of the offering or 17
execution of a direct health care agreement or the provision of health care services 18
under a direct health care agreement. A certificate of authority or license to market, 19
sell, or offer to sell a direct health care agreement or health care services under a direct 20
health care agreement is not required to offer or execute a direct health care agreement 21
or provide health care services under a direct health care agreement. 22
(l) In this section, 23
(1) "health care business" means a business licensed by the state that is 24
entirely owned by health care providers; 25
(2) "health care insurance" has the meaning given in AS 21.12.050(b); 26
(3) "health care insurer" has the meaning given in AS 21.54.500; 27
(4) "health care provider" has the meaning given in AS 21.07.250; 28
(5) "health care service" 29
(A) means a health care service or procedure that is provided in 30
person or remotely by telemedicine or other means by a health care provider 31 33-LS0324\A
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for the care, prevention, diagnosis, or treatment of a physical or mental illness, 1
health condition, disease, or injury; 2
(B) does not include "emergency services" as defined in 3
AS 21.07.250; 4
(6) "health insurance" has the meaning given in AS 21.12.050; 5
(7) "health maintenance organization" has the meaning given in 6
AS 21.86.900; 7
(8) "medical service corporation" has the meaning given in 8
AS 21.87.330. 9
* Sec. 2. AS 45.45 is amended by adding a new section to read: 10
Sec. 45.45.915. Direct health care agreements. (a) A health care provider or 11
health care business may not decline to enter into a direct health care agreement with a 12
new patient or terminate a direct health care agreement with an existing patient solely 13
because of the patient's race, religion, color, national origin, age, sex, physical or 14
mental disability, marital status, change in marital status, pregnancy, parenthood, or 15
any other characteristic of a class of persons protected by a state law that prohibits 16
discrimination. 17
(b) A health care provider or health care business may decline to enter into a 18
direct health care agreement with a new patient if the health care provider or health 19
care business 20
(1) is unable to provide to the patient the health care services the 21
patient requires; or 22
(2) does not have the capacity to accept new patients. 23
(c) A health care provider or health care business may terminate a direct 24
health care agreement with an existing patient based on the patient's health status only 25
if the health care provider is unable to provide to the patient the health care services 26
the patient requires or in accordance with AS 21.03.025. 27
(d) In this section, 28
(1) "direct health care agreement" means an agreement described in 29
AS 21.03.025; 30
(2) "health care business" has the meaning given in AS 21.03.025(l); 31 33-LS0324\A
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(3) "health care provider" has the meaning given in AS 21.07.250; 1
(4) "health care service" has the meaning given in AS 21.03.025(l). 2
* Sec. 3. AS 45.50.471(b) is amended by adding a new paragraph to read: 3
(58) violating AS 45.45.915 (direct health care agreements). 4