Wisconsin 2025-2026 Regular Session

Wisconsin Senate Bill SB98 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	2025 - 2026 LEGISLATURE
2	2	LRB-0784/4
3	3	JPC&ARG:cdc
4	4	2025 SENATE BILL 98
5	5	March 7, 2025 - Introduced by Senators HUTTON, FELZKOWSKI and WALL,
6	6	cosponsored by Representatives CALLAHAN, ARMSTRONG, DITTRICH,
7	7	GUNDRUM, KNODL, KREIBICH, SUBECK, SUMMERFIELD, TUSLER, WICHGERS
8	8	and WITTKE. Referred to Committee on Insurance, Housing, Rural Issues and
9	9	Forestry.
10	10	AN ACT to create 613.76 of the statutes; relating to: conversion of cooperative
11	11	associations organized to establish and operate nonprofit plans or programs
12	12	for health care into service insurance corporations.
13	13	Analysis by the Legislative Reference Bureau
14	14	This bill allows a health care cooperative to convert into a service insurance
15	15	corporation.
16	16	Under current law, a cooperative may be formed by filing articles of
17	17	incorporation with the Department of Financial Institutions. A cooperative is
18	18	organized and owned by its members and managed by a board of directors. Under
19	19	current law, a cooperative may be organized primarily to establish and operate
20	20	nonprofit plans or programs for health care for their members and their members[
21	21	dependents.
22	22	Also under current law, a service insurance corporation, sometimes referred to
23	23	as a Xnonprofit service plan,Y may be formed by following many of the same
24	24	procedures that apply to nonstock corporations, like filing articles of incorporation
25	25	and bylaws, except that service insurance corporations are regulated by the Office
26	26	of the Commissioner of Insurance instead of DFI. A service insurance corporation
27	27	is a corporation incorporated in this state to provide insured service benefits, like
28	28	health care, to consumers within a flexible legal framework.
29	29	Under this bill, a health care cooperative may convert into a service insurance
30	30	corporation. To convert into a service insurance corporation, a health care
31	31	1
32	32	2
33	33	3 2025 - 2026 Legislature
34	34	SENATE BILL 98
35	35	- 2 - LRB-0784/4
36	36	JPC&ARG:cdc
37	37	SECTION 1
38	38	cooperative seeking conversion must adopt a plan of conversion, obtain the
39	39	commissioner[s approval of the plan of conversion, have the members of the health
40	40	care cooperative agree to the conversion as provided under current law, and submit
41	41	evidence to the commissioner that the members of the cooperative association
42	42	approve of the plan of conversion. The bill requires the commissioner to approve
43	43	any submitted plan of conversion unless the commissioner concludes, after a
44	44	hearing, that the plan is contrary to law, the surplus of the resulting service
45	45	insurance corporation or the contracts that the resulting service insurance
46	46	corporation possesses with providers are inadequate to support the plan, or the
47	47	plan is contrary to the interests of members of the health care cooperative seeking
48	48	conversion or to the interests of the public. If all requirements for conversion are
49	49	met, the bill provides that the commissioner must issue a certificate of authority to
50	50	the new service insurance corporation and that, immediately after issuing the
51	51	certificate of authority, the legal existence of the health care cooperative ceases.
52	52	The bill provides that the new service insurance corporation has all the assets and
53	53	is liable for all of the obligations of the converted health care cooperative.
54	54	The people of the state of Wisconsin, represented in senate and assembly, do
55	55	enact as follows:
56	56	SECTION 1. 613.76 of the statutes is created to read:
57	57	613.76 Conversion of a cooperative association into a service
58	58	insurance corporation. (1) AUTHORIZATION. A cooperative association
59	59	organized under s. 185.981 may be converted into a service insurance corporation
60	60	under this chapter as provided in this section.
61	61	(2) ACTION BY BOARD. A cooperative association seeking conversion under this
62	62	section shall adopt a plan of conversion stating all of the following:
63	63	(a) The reasons for and purposes of the proposed action.
64	64	(b) The proposed terms, conditions, and procedures for implementing the
65	65	conversion.
66	66	(c) The proposed name of the service insurance corporation.
67	67	(d) The proposed articles and bylaws of the service insurance corporation.
68	68	(3) COMMISSIONER[S APPROVAL REQUIRED. (a) No proposed plan of conversion
69	69	1
70	70	2
71	71	3
72	72	4
73	73	5
74	74	6
75	75	7
76	76	8
77	77	9
78	78	10
79	79	11
80	80	12
81	81	13 2025 - 2026 Legislature
82	82	SENATE BILL 98
83	83	- 3 - LRB-0784/4
84	84	JPC&ARG:cdc
85	85	SECTION 1
86	86	under this section may be submitted to the members of the cooperative association
87	87	under sub. (4) until the cooperative association submits the plan adopted under sub.
88	88	(2) to the commissioner, together with as much of the information under s. 611.13
89	89	(2) as the commissioner reasonably requires, and the commissioner approves the
90	90	plan.
91	91	(b) The commissioner shall approve a plan of conversion submitted under par.
92	92	(a) unless the commissioner finds, after a hearing, that any of the following would
93	93	apply:
94	94	1. The plan is contrary to law.
95	95	2. The surplus of the service insurance corporation or the contracts the
96	96	service insurance corporation possesses with providers are inadequate to support
97	97	the plan.
98	98	3. The plan is contrary to the interests of members of the cooperative
99	99	association seeking conversion or the public.
100	100	(4) APPROVAL BY MEMBERS. After being approved by the commissioner under
101	101	sub. (3) (b), the plan adopted under sub. (2) shall be submitted for approval to the
102	102	members of the cooperative association in accordance with ch. 185.
103	103	(5) REPORT APPROVAL TO COMMISSIONER. A cooperative association seeking
104	104	conversion under this section that has submitted a plan of conversion to the
105	105	commissioner under sub. (3) (a) that is approved by the commissioner under sub. (3)
106	106	(b) shall submit evidence to the commissioner that the members of the cooperative
107	107	association approve of the plan of conversion under sub. (4).
108	108	(6) AMENDMENT, ABANDONMENT , ARTICLES, AND EFFECT OF CONVERSION. (a)
109	109	1
110	110	2
111	111	3
112	112	4
113	113	5
114	114	6
115	115	7
116	116	8
117	117	9
118	118	10
119	119	11
120	120	12
121	121	13
122	122	14
123	123	15
124	124	16
125	125	17
126	126	18
127	127	19
128	128	20
129	129	21
130	130	22
131	131	23 2025 - 2026 Legislature
132	132	SENATE BILL 98
133	133	- 4 - LRB-0784/4
134	134	JPC&ARG:cdc
135	135	SECTION 1
136	136	A plan of conversion approved by the members of a cooperative association under
137	137	sub. (4) may be amended or abandoned as provided in s. 181.1163 (2) and (3).
138	138	(b) A cooperative association seeking conversion under this section that
139	139	submits a plan of conversion for approval by its membership under sub. (4) that is
140	140	approved by the membership shall file with the department of financial institutions
141	141	articles of conversion as provided in s. 181.1164.
142	142	(c) The effect of conversion shall be as provided in s. 181.1165.
143	143	(7) OFFICERS AND DIRECTORS. The officers and directors of a cooperative
144	144	association converting into a service insurance corporation under this section shall
145	145	be the initial officers and directors of the service insurance corporation.
146	146	(8) CERTIFICATE OF AUTHORITY. If all requirements of the law are met, the
147	147	commissioner shall issue a certificate of authority to the new service insurance
148	148	corporation. Thereupon the cooperative association shall cease its legal existence
149	149	and the corporate existence of the new service insurance corporation shall begin,
150	150	but it shall be deemed to have been incorporated as of the date the converted
151	151	cooperative association was incorporated. The new service insurance corporation
152	152	shall have all the assets and be liable for all of the obligations of the converted
153	153	cooperative association. The commissioner may grant a period not exceeding one
154	154	year for adjustment to the requirements of ch. 613, specifying the extent to which
155	155	particular provisions of ch. 613 do not apply.
156	156	(9) EXPENSES. A cooperative association converting into a service insurance
157	157	corporation under this section may not pay compensation of any kind to existing
158	158	personnel, in connection with the proposed conversion, other than regular salaries.
159	159	With the commissioner[s approval, payment may be made at reasonable rates for
160	160	1
161	161	2
162	162	3
163	163	4
164	164	5
165	165	6
166	166	7
167	167	8
168	168	9
169	169	10
170	170	11
171	171	12
172	172	13
173	173	14
174	174	15
175	175	16
176	176	17
177	177	18
178	178	19
179	179	20
180	180	21
181	181	22
182	182	23
183	183	24 2025 - 2026 Legislature
184	184	SENATE BILL 98
185	185	- 5 - LRB-0784/4
186	186	JPC&ARG:cdc
187	187	SECTION 1
188	188	printing costs and for legal and other professional fees for services actually
189	189	rendered.
190	190	(END)
191	191	1
192	192	2
193	193	3