HLS 10RS-1118 ORIGINAL
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Regular Session, 2010
HOUSE BILL NO. 1191
BY REPRESENTATIVE TALBOT
INSURANCE/HEALTH-ACCID: Authorizes establishment of an interstate compact
governing the sale of health insurance policies and subscriber agreements across
state lines
AN ACT1
To enact R.S. 22:4, relative to the sale of health insurance policies and subscriber2
agreements; to authorize establishment of an interstate compact governing such sales3
across state lines; to provide for legislative delegation of the commissioner of4
insurance as the representative of this state for such compact; to provide for the5
purposes of such compact; to allow health insurance issuers and health maintenance6
organization to offer and issue selected individual policies and subscriber agreements7
in this state if such entity is licensed and in good standing in its state of origin; to8
establish requirements for such entities, including disclosure, membership in the9
Louisiana Life and Health Insurance Guaranty Association, notice of imminent10
insolvency, and compliance with the regulatory assessment and premium tax11
payment requirements of this state; to provide for a termination date; and to provide12
for related matters.13
Be it enacted by the Legislature of this state:14
Section 1. R.S. 22:4 is hereby enacted to read as follows: 15
ยง4. Authorization; negotiation for health insurance compact16
A. It is the intent of the state of Louisiana to be authorized to join with other17
states to establish a health insurance compact governing the sale of selected18
individual health benefit plans in this state. The legislature designates and authorizes19 HLS 10RS-1118 ORIGINAL
HB NO. 1191
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the insurance commissioner of this state to serve as the representative of this state1
for such compact.2
B. (1) The purposes of the health insurance compact, through the means of3
joint and cooperative action among the compacting states, shall be all of the4
following:5
(a) To increase the competitive availability of health insurance.6
(b) To develop uniform standards for selected individual health insurance7
products covered under the compact.8
(c) To establish an agreed method of confirming that health insurance9
policies and subscriber agreements issued in this state comply with the requirements10
of this Title.11
(d) To improve coordination of regulatory resources and expertise between12
state insurance departments regarding the setting of uniform standards and review13
of selected individual health insurance policies and subscriber agreements covered14
under the compact.15
(2) The commissioner intends to establish a mechanism permitting selected16
individual policies and subscriber agreements to be offered in participating states17
in the compact subject to the applicable laws of this state and applicable laws of18
other states in which the health insurance policy or subscriber agreement was written19
or issued, provided that the health insurance issuer or health maintenance20
organization of any selected individual health insurance policy and subscriber21
agreement are subject to the market conduct, unfair trade practices, network22
adequacy, and consumer protection standards, including addressing disputes as to the23
performance of the contract, of the state in which the purchaser resides.24
B. The commissioner shall have the authority to take the lead in creating a25
health insurance compact of like-minded states with substantially similar states and26
in establishing rules and standards for reciprocity agreements. The commissioner27
is authorized to negotiate the establishment of a compact with other states including28
but not limited to the following:29 HLS 10RS-1118 ORIGINAL
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(1) The compact does not prevent the enforcement of any state law of a1
compacting state.2
(2) All lawful actions of the compact, including all rules and operating3
procedures adopted by the compact, are binding on the compacting states.4
(3) In the event that any provision of the health insurance compact exceeds5
the constitutional limits imposed on the legislature of any compacting state, the6
obligations, duties, powers, or jurisdiction sought to be conferred by that provision7
upon the health insurance compact state is ineffective as to that compacting state and8
those obligations, duties, powers, or jurisdiction remain with the compacting state9
and shall be exercised by the agency thereof to which those obligations, duties,10
powers, or jurisdiction are delegated by law in effect at the time the health insurance11
compact becomes effective.12
(4) Health insurance issuers and health maintenance organizations offering13
selected individual health insurance policies and subscriber agreements shall comply14
with and are subject to the laws of the compacting state in which the insured or15
enrollee resides relating to each of the following:16
(a) Market conduct.17
(b) Unfair trade practices.18
(c) Network adequacy.19
(d) Consumer protection standards and unfair trade practices.20
(e) Grievances and appeals.21
(f) Fraud.22
(g) Financial solvency requirements.23
(5) Health insurance issuers and health maintenance organizations shall clearly24
notify insureds or enrollees that the policy may not be subject to all the laws and25
regulations of the state in which the insureds or enrollees reside.26
(6) The commissioner of this state shall have the authority to approve or27
disapprove for sale any select individual health insurance policy or subscriber28
agreement.29 HLS 10RS-1118 ORIGINAL
HB NO. 1191
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C. (1) Health insurance issuers and health maintenance organizations may1
offer and issue selected individual policies and subscriber agreements in this state if2
the health insurance issuer or health maintenance organization is licensed and in good3
standing in its state of origin. Selected individual policies and subscriber agreements4
must be approved for offer and issue by the health insurance issuer and heath5
maintenance organization's state of origin prior to being offered and issued in this6
state, including but not limited to the following:7
(a) The selected individual policy or subscriber agreement is approved as to8
form by one of the compacting states and the commissioner of this state.9
(b) The health insurance issuer's or health maintenance organization's rating10
schedule for the selected individual policy or subscriber agreement is approved by its11
state of origin.12
(c) The health insurance issuer or health maintenance organization reports to13
the commissioner of this state the amount of premium sold in each compacting state14
and provides such other data as the commissioner may require by rule.15
(d) The health insurance issuer and the health maintenance organization16
comply with the requirements of the health insurance compact and of this Section.17
(2) If a state of origin determines that a selected individual policy or18
subscriber agreement is not in compliance for any reason, the state of origin must19
notify the department of this state of the plan's change in status. The health insurance20
issuer or health maintenance organization must immediately cease offering and21
issuing the qualifying plan until the state of origin has confirmed to the health22
insurance issuer or health maintenance organization and to the department of this state23
in writing that the qualifying plan is again in compliance.24
D. Health insurance issuers or health maintenance organizations offering and25
issuing select individual health insurance policies or subscriber agreements in this26
state shall file with the commissioner of this state and provide insureds or enrollees27
residing in this state with a written disclosure containing a side-by-side comparison28
that explains the differences between each select individual health insurance policies'29 HLS 10RS-1118 ORIGINAL
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or subscriber agreements' requirements, conditions, and benefits compared to the1
requirements for health insurance policies or subscriber agreements offered or issued2
in this state, including but not limited to the following:3
(1) Claims payment.4
(2) Coinsurance, copayments, and deductibles.5
(3) Preexisting condition limitations.6
(4) Mandated benefits.7
(5) Guaranteed issue.8
(6) Use of discretionary clauses.9
(7) Out-of-pocket and lifetime limits.10
(8) Method of calculating rates or premium.11
(9) Health underwriting practices.12
E. Each select individual health insurance policy or subscriber agreement13
issued in this state shall prominently display the legal name of the issuing health14
insurance issuer or health maintenance organization, its business address, its website,15
its telephone number, and any other information necessary to assist residents of this16
state in contacting the health insurance issuer or health maintenance organization or17
its administrator.18
F. (1) Health insurance issuers or health maintenance organizations offering19
select individual health insurance policies or subscriber agreements in this state shall20
be members of the Louisiana Life and Health Insurance Guaranty Association and21
are subject to the requirements of Part II of Chapter 10 of this Title for their covered22
insureds or enrollees who are residents of this state.23
(2) States of origin shall provide notice to the department of insurance of this24
state whenever the state of origin comes into possession of any data or information25
relative to an health insurance issuer or health maintenance organization offering26
select individual health insurance policies or subscriber agreements indicating that27
such health insurance issuer or health maintenance organization is in or is28
approaching a condition of impaired assets, imminent insolvency, or insolvency. If29 HLS 10RS-1118 ORIGINAL
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the state of origin takes any formal action against a health insurance issuer or health1
maintenance organization offering select individual health insurance policies or2
subscriber agreements, the compacting state must notify the department of this state3
of the action and require the health insurance issuer or health maintenance4
organization to cease offering or issuing select individual health insurance policies or5
subscriber agreements. The commissioner of this state shall be authorized to take any6
legal or administrative action to protect insureds or enrollees residing in this state.7
G. Health insurance issuers or health maintenance organizations offering and8
issuing select individual health insurance policies or subscriber agreements in this9
state shall comply with the regulatory assessment and premium tax payment10
requirements of this state as if they were admitted health insurance issuers or health11
maintenance organizations in this state.12
H. The provisions of this Section shall be null and void and cease to be13
effective on January 1, 2015.14
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Talbot HB No. 1191
Abstract: Authorizes the state of Louisiana to be authorized to join with other states to
establish a health insurance compact governing the sale of selected individual health
benefit plans in this state.
Proposed law states that it is the intent of the state of Louisiana to be authorized to join with
other states to establish a health insurance compact governing the sale of selected individual
health benefit plans in this state. Further states that the legislature designates and authorizes
the insurance commissioner of this state to serve as the state's representative for such
compact. Otherwise provides with respect to such compact as follows:
(1)Provides the purposes of the compact as:
(a)Increasing the competitive availability of health insurance.
(b)Developing uniform standards for selected individual health insurance
products covered under the compact.
(c)Establishing an agreed method of confirming that health insurance policies
and subscriber agreements issued in this state comply with the requirements
of present law, the Insurance Code.
(d)Improving coordination of regulatory resources and expertise between state
insurance departments regarding the setting of uniform standards and review
of selected individual health insurance policies and subscriber agreements. HLS 10RS-1118 ORIGINAL
HB NO. 1191
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are additions.
(2)States that the commissioner intends to establish a mechanism permitting selected
individual policies and subscriber agreements to be offered in participating states in
the compact subject to the applicable laws of this state and applicable laws of other
states in which the health insurance policy or subscriber agreement was written or
issued, provided that the health insurance issuer or HMO of any selected individual
health insurance policy and subscriber agreement are subject to the market conduct,
unfair trade practices, network adequacy, and consumer protection standards,
including addressing disputes as to the performance of the contract, of the state in
which the purchaser resides.
(3)Authorizes the commissioner to take the lead in creating a health insurance compact
of like-minded states with substantially similar states and in establishing rules and
standards for reciprocity agreements. Further authorizes him to negotiate the
establishment of a compact with other states including but not limited to the
following:
(a)The compact does not prevent the enforcement of any state law of a
compacting state.
(b)All lawful actions of the compact, including all rules and operating procedures
adopted by the compact, are binding on the compacting states.
(c)In the event that any provision of the health insurance compact exceeds the
constitutional limits imposed on the legislature of any compacting state, the
obligations, duties, powers, or jurisdiction sought to be conferred by that
provision upon the health insurance compact state are ineffective as to that
compacting state and those obligations, duties, powers, or jurisdiction remain
with the compacting state and shall be exercised by the agency thereof to
which those obligations, duties, powers, or jurisdiction are delegated by law
in effect at the time the health insurance compact becomes effective.
(4)Requires health insurance issuers and health maintenance organizations (HMOs)
offering selected individual health insurance policies and subscriber agreements to
comply with and be subject to the laws of the compacting state in which the insured
or enrollee resides relating to each of the following:
(a)Market conduct.
(b)Unfair trade practices.
(c)Network adequacy.
(d)Consumer protection standards and unfair trade practices.
(e)Grievances and appeals.
(f)Fraud.
(g)Financial solvency requirements.
(5)Requires health insurance issuers and HMOs to clearly notify insureds or enrollees
that the policy may not be subject to all the laws and regulations of the state in which
the insureds or enrollees reside.
(6)Authorizes the commissioner of this state to approve or disapprove for sale any select
individual health insurance policy or subscriber agreement.
(7) Authorizes health insurance issuers and HMOs to offer and issue selected individual
policies and subscriber agreements in this state if the health insurance issuer or HMO
is licensed and in good standing in its state of origin. Requires that selected
individual policies and subscriber agreements be approved for offer and issue by the
health insurance issuer and HMO's state of origin prior to being offered and issued in
this state, including but not limited to the following:
(a)The selected individual policy or subscriber agreement is approved as to form
by one of the compacting states and the commissioner of this state. HLS 10RS-1118 ORIGINAL
HB NO. 1191
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(b)The health insurance issuer's or HMO's rating schedule for the selected
individual policy or subscriber agreement is approved by its state of origin.
(c)The health insurance issuer or HMO reports to the commissioner the amount
of premium sold in each compacting state and provides such other data as the
commissioner may require by rule.
(d)The health insurance issuer and the HMO comply with the requirements of the
health insurance compact and of proposed law.
(8)Provides that if a state of origin determines that a selected individual policy or
subscriber agreement is not in compliance for any reason, the state of origin must
notify the department of this state of the plan's change in status. Requires the health
insurance issuer or HMO to immediately cease offering and issuing the qualifying
plan until the state of origin has confirmed to the health insurance issuer or HMO and
to the department of this state in writing that the qualifying plan is again in
compliance.
(9)Requires health insurance issuers or HMOs offering and issuing select individual
health insurance policies or subscriber agreements in this state to file with the
commissioner of this state and provide insureds or enrollees residing in this state with
a written disclosure containing a side-by-side comparison that explains the differences
between each select individual health insurance policies' or subscriber agreements'
requirements, conditions, and benefits compared to the requirements for health
insurance policies or subscriber agreements offered or issued in this state, including
but not limited to the following:
(a) Claims payment.
(b) Coinsurance, copayments, and deductibles.
(c) Preexisting condition limitations.
(d) Mandated benefits.
(e) Guaranteed issue.
(f) Use of discretionary clauses.
(g) Out-of-pocket and lifetime limits.
(h) Method of calculating rates or premium.
(i) Health underwriting practices.
(10)Requires that each select individual health insurance policy or subscriber agreement
issued in this state shall prominently display the legal name of the issuing health
insurance issuer or HMO, its business address, its website, its telephone number, and
any other information necessary to assist residents of this state in contacting the health
insurance issuer or HMO or its administrator.
(11)Requires health insurance issuers or HMOs offering select individual health insurance
policies or subscriber agreements in this state to be members of the La. Life and
Health Insurance Guaranty Association and subject to the requirements of present law
relative to such association for their covered insureds or enrollees who are residents
of this state.
(12)Requires states of origin to provide notice to the department of insurance of this state
whenever the state of origin comes into possession of any data or information relative
to an health insurance issuer or HMO offering select individual health insurance
policies or subscriber agreements indicating that such health insurance issuer or
HMO is in or is approaching a condition of impaired assets, imminent insolvency, or
insolvency. Further provides that if the state of origin takes any formal action against
a health insurance issuer or HMO offering select individual health insurance policies
or subscriber agreements, the compacting state must notify the department of this
state of the action and require the health insurance issuer or HMO to cease offering
or issuing select individual health insurance policies or subscriber agreements. HLS 10RS-1118 ORIGINAL
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Authorizes the commissioner of this state to take any legal or administrative action
to protect insureds or enrollees of this state.
(13)Requires that health insurance issuers or HMOs offering and issuing select individual
health insurance policies or subscriber agreements in this state comply with the
regulatory assessment and premium tax payment requirements of this state as if they
were admitted health insurance issuers or HMOs in this state.
(14)Provides that proposed law shall be null and void and shall terminate on January 1,
2015.
(Adds R.S. 22:4)