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HOUSE CS FOR CS FOR SENATE BILL NO. 45(L&C)
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-THIRD LEGISLATURE - FIRST SESSION
BY THE HOUSE LABOR AND COMMERCE COMMITTEE
Offered: 5/15/23
Referred: Rules
Sponsor(s): SENATORS WILSON, Hughes, Myers, Kaufman
A BILL
FOR AN ACT ENTITLED
"An Act relating to insurance; relating to direct health care agreements; relating to the 1
duties of the director of the division of insurance in the Department of Commerce, 2
Community, and Economic Development; and providing for an effective date." 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 4
* Section 1. AS 21.03 is amended by adding a new section to read: 5
Sec. 21.03.025. Direct health care agreements. (a) A health care provider or 6
health care business and a patient or the representative of a patient may enter into a 7
direct health care agreement. Health care services provided under a direct health care 8
agreement are limited to the type of health care services that a primary care provider 9
may provide to a patient. A patient is not eligible to enter into a direct health care 10
agreement under this section if the patient is eligible to receive assistance under 11
AS 47.07 (Medical Assistance for Needy Persons) or AS 47.08 (Assistance for 12
Catastrophic Illness and Chronic or Acute Medical Conditions). 13
(b) To be eligible to enter into a direct health care agreement under this 14 33-LS0211\Y
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section, a health care provider or health care business must 1
(1) accept new patients who are enrolled in the Medicare program; or 2
(2) maintain a practice in which 20 percent or more of the patients 3
(A) are enrolled in the Medicare program; or 4
(B) do not have health insurance. 5
(c) A direct health care agreement must 6
(1) describe the health care services that the health care provider or 7
health care business makes available to the patient in exchange for payment of a 8
periodic fee and each location at which the health care services are available; 9
(2) specify 10
(A) the amount of the periodic fee a patient or the 11
representative of a patient pays in exchange for the health care services that the 12
health care provider or health care business makes available to the patient; 13
(B) the period covered by the periodic fee under (A) of this 14
paragraph; and 15
(C) additional fees that the health care provider or health care 16
business may charge in addition to the periodic fee, including termination fees; 17
and 18
(3) identify and include contact information for a representative of the 19
health care provider or health care business that is responsible for receiving and 20
addressing 21
(A) a complaint made by a patient relating to the agreement; 22
and 23
(B) a request made by a patient to amend the agreement, 24
including a patient's request to change the name of the representative of the 25
patient or the patient's mailing address, physical address, telephone number, 26
electronic mail address, or other personal information. 27
(d) The amount of the periodic fee may not be based solely on the patient's 28
health status or sex. 29
(e) A health care provider or health care business may not decline to enter into 30
a direct health care agreement with a new patient or terminate a direct health care 31 33-LS0211\Y
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agreement with an existing patient solely because of the patient's race, religion, color, 1
national origin, age, sex, physical or mental disability, marital status, change in marital 2
status, pregnancy, parenthood, or any other characteristic of a class of persons 3
protected by a state law that prohibits discrimination. 4
(f) A health care provider or health care business may decline to enter into a 5
direct health care agreement with a new patient if the health care provider or health 6
care business 7
(1) is unable to provide to the patient the health care services the 8
patient requires; or 9
(2) does not have the capacity to accept new patients. 10
(g) A health care provider or health care business may terminate a direct 11
health care agreement with an existing patient based on the patient's health status only 12
if the health care provider is unable to provide to the patient the health care services 13
the patient requires or in accordance with this section. 14
(h) A patient or the representative of a patient may terminate a direct health 15
care agreement in writing within 30 days after entering into the agreement. If a patient 16
or representative terminates an agreement under this subsection, the health care 17
provider or health care business shall, not later than 30 days after the patient or 18
representative terminates the agreement, refund to the patient or representative 19
payments made under the agreement, less payments made for services the health care 20
provider or health care business has already performed that are not included in the 21
periodic fee. 22
(i) A health care provider or health care business may immediately terminate a 23
direct health care agreement if 24
(1) 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; 27
(2) 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; or 31 33-LS0211\Y
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(3) a patient or the representative of a patient breaches the terms of the 1
agreement. 2
(j) A patient or the representative of a patient 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
(k) A health care provider or health care business may not change the periodic 6
fee under the agreement more than once a year and shall provide at least 45 days' 7
written notice of a change in the periodic fee. If a health care provider or health care 8
business increases the amount of the periodic fee, a patient or the representative of a 9
patient may terminate the agreement by providing to the health care provider or health 10
care business written notice of the termination not later than the day before the date on 11
which the change to the periodic fee is scheduled to take effect. 12
(l) Except as otherwise provided in this section, a health care provider, a 13
health care business, a patient, or the representative of a patient may terminate a direct 14
health care agreement for any reason in writing after at least 30 days' notice. 15
(m) A health care provider or health care business may charge a termination 16
fee only for termination of an agreement by a patient or the representative of a patient 17
under (h) of this section. The termination fee may not exceed an amount equal to one 18
month's cost of the periodic fee. 19
(n) Upon termination of an agreement under (k) or (l) of this section, the 20
patient shall pay the health care provider or health care business the periodic fee, 21
prorated through the date of termination of the agreement, and any additional fees for 22
services the health care provider or health care business has already performed that are 23
not included in the periodic fee. 24
(o) A health care provider or health care business may bill a patient or the 25
representative of a patient for the periodic fee only after the end of the period to which 26
the periodic fee applies. 27
(p) A patient's employer may pay the periodic fee and additional fees the 28
patient owes a health care provider or health care business under a direct health care 29
agreement. A payment by the employer under this subsection does not constitute 30
engaging in the business of insurance or underwriting in this state, and the employer is 31 33-LS0211\Y
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not an insurer, a health maintenance organization, a health care insurer, or a medical 1
service corporation by virtue of the payment. 2
(q) A direct health care agreement and a health care provider or health care 3
business providing health care services under a direct health care agreement are 4
subject to AS 21.36 (Trade Practices and Frauds) to the extent applicable and when 5
not in conflict with the express provisions of this section. 6
(r) A health care provider or health care business may not make, publish, 7
disseminate, circulate, broadcast, or place before the public, or cause, directly or 8
indirectly, to be made, published, disseminated, circulated, broadcast, or placed before 9
the public, in a newspaper, magazine, or other publication, or in the form of a notice, 10
circular, pamphlet, letter, or poster, or over a radio or television station, or in any other 11
way, an advertisement, announcement, or statement containing an assertion, 12
representation, or statement that is untrue, deceptive, or misleading with respect to 13
(1) the terms of or the benefits or advantages provided by a direct 14
health care agreement; 15
(2) the characterization of a direct health care agreement, including the 16
characterization of a direct health care agreement as health insurance or an alternative 17
to health insurance; 18
(3) the business of a direct health care agreement. 19
(s) The director shall adopt regulations regulating direct health care 20
agreements that are consistent with this section. 21
(t) Except as provided in this section, a health care provider or health care 22
business that offers or executes a direct health care agreement that complies with this 23
section is not otherwise subject to this title. 24
(u) In this section, 25
(1) "direct health care agreement" means a written agreement between 26
a health care provider or health care business and a patient or the representative of a 27
patient to provide health care services in exchange for payment of a periodic fee; 28
(2) "health care business" means a business that is entirely owned by 29
health care providers; 30
(3) "health care insurer" has the meaning given in AS 21.54.500; 31 33-LS0211\Y
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(4) "health care provider" has the meaning given in AS 21.07.250; 1
(5) "health care service" 2
(A) means a health care service or procedure that is provided in 3
person or remotely by telemedicine or other means by a health care provider 4
for the care, prevention, diagnosis, or treatment of a physical or mental illness, 5
health condition, disease, or injury; 6
(B) does not include "emergency services" as defined in 7
AS 21.07.250; 8
(6) "health insurance" has the meaning given in AS 21.12.050; 9
(7) "health maintenance organization" has the meaning given in 10
AS 21.86.900; 11
(8) "medical service corporation" has the meaning given in 12
AS 21.87.330; 13
(9) "primary care provider" has the meaning given in AS 21.07.250. 14
* Sec. 2. The uncodified law of the State of Alaska is amended by adding a new section to 15
read: 16
TRANSITION: REGULATIONS. The director of the division of insurance may adopt 17
regulations necessary to implement this Act. The regulations take effect under AS 44.62 18
(Administrative Procedure Act), but not before the effective date of the law implemented by 19
the regulation. 20
* Sec. 3. Section 2 of this Act takes effect immediately under AS 01.10.070(c). 21
* Sec. 4. Except as provided in sec. 3 of this Act, this Act takes effect January 1, 2024. 22