Enrolled HB 10: Relating to pooling by employers and self-employed individuals for purposes of group health insurance; and providing for an effective date.
00Enrolled HB 10 01 Relating to pooling by employers and self-employed individuals for purposes of group health 02 insurance; and providing for an effective date. 03 _______________ 04 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 05 to read: 06 INTENT. It is the intent of this Act to allow small and large employers, including 07 nonprofit employers, as well as self-employed individuals, to form an association for group 08 health insurance purposes. 09 * Sec. 2. AS 21.54.015 is amended by adding a new subsection to read: 10 (b) A health care insurer may decline to cover or may restrict the coverage 11 offered to a self-employed individual under an association plan authorized under 12 AS 21.54.060(7). 13 * Sec. 3. AS 21.54.060 is amended to read: 14 Sec. 21.54.060. Group health insurance defined. Group health insurance is
01 that form of health insurance covering groups of persons as defined below, with or 02 without one or more members of their families or one or more of their dependents, or 03 covering one or more members of the families or one or more dependents of the 04 groups of persons and issued upon the following basis: 05 (1) under a policy issued to an employer or trustees of a fund 06 established by an employer, who shall be considered the policyholder, insuring 07 employees of the employer for the benefit of persons other than the employer; in this 08 paragraph the term "employees" includes the officers, managers, and employees of the 09 employer, the individual proprietor or partner if the employer is an individual 10 proprietor or partnership, the officers, managers, and employees of subsidiary or 11 affiliated corporations, the individual proprietors, partners, and employees of 12 individuals and firms if the business of the employer and the individual or firm is 13 under common control through stock ownership, contract, or otherwise; in this 14 paragraph, "employees" may include retired employees; a policy issued to insure 15 employees of a public body may provide that the term "employees" includes elected or 16 appointed officials; the policy may provide that the term "employees" includes the 17 trustees or their employees, or both, if their duties are principally connected with the 18 trusteeship; a policy issued to insure employees of a corporation may provide that the 19 term "employees" includes directors of the corporation, whether or not the directors 20 receive compensation; 21 (2) under a policy issued to an association, including a labor union, 22 that has a constitution and bylaws and that has been organized and is maintained in 23 good faith for purposes other than that of obtaining insurance, insuring members, 24 employees, or employees of members of the association for the benefit of persons 25 other than the association or its officers or trustees; in this paragraph, the term 26 "employees" may include retired employees; 27 (3) under a policy issued to the trustees of a fund established by two or 28 more employers in the same or related industry or by one or more labor unions or by 29 one or more employers and one or more labor unions or by an association as defined 30 in (2) of this section, which trustees shall be considered the policyholder, to insure 31 employees of the employers or members of the unions or of the association, or
01 employees of members of the association, for the benefit of persons other than the 02 employers or the unions or the association; in this paragraph, the term "employees" 03 may include the officers, managers, and employees of the employer, and the individual 04 proprietor or partners if the employer is an individual proprietor or partnership; in this 05 paragraph, the term "employees" may include retired employees; the policy may 06 provide that the term "employees" includes the trustees or their employees, or both, if 07 their duties are principally connected with the trusteeship; 08 (4) under a policy issued to a person or organization to which a policy 09 of group life insurance may be issued or delivered in this state to insure a class or 10 classes of individuals that could be insured under the group life policy; 11 (5) under a policy issued to cover any other substantially similar group 12 that, in the discretion of the director, may be subject to the issuance of a group health 13 insurance policy or contract; 14 (6) a group health insurance policy that contains provisions for the 15 payment by the insurer of benefits for expenses incurred on account of hospital, 16 nursing, medical, or surgical services for members of the family or dependents of a 17 person in the insured group may provide for the continuation of the benefit provisions, 18 or a part or parts of them, after the death of the person in the insured group; 19 (7) under a policy issued to an association of employers covering 20 the employees and dependents of the employees, or issued to an association of 21 self-employed individuals covering self-employed individuals and dependents of 22 the self-employed individuals, or issued to an association that includes a 23 combination of employers and self-employed individuals; for purposes of this 24 paragraph, 25 (A) an association described under this paragraph shall 26 comply with the following requirements: 27 (i) the association shall have a constitution and 28 bylaws; 29 (ii) the association shall be maintained in good faith 30 for the benefit of persons other than the association or its officers 31 or trustees;
01 (iii) membership in the association shall be restricted 02 to large or small employers, or self-employed individuals, who are 03 residents of the state; however, an employer domiciled in another 04 state may become a member of the association for purposes of 05 obtaining coverage through the association only for the employees 06 and dependents of the employees of that employer who are 07 residents of this state; 08 (iv) except as provided under AS 21.54.015, the 09 association may not condition membership in the association or 10 coverage under a health insurance policy issued to the association 11 on any of the factors listed under AS 21.54.100(a); 12 (B) "self-employed individual" means an individual who 13 derives a substantial portion of the individual's income from a trade or 14 business through which the individual has attempted to earn taxable 15 income and for which the individual has filed the appropriate Internal 16 Revenue Service form and schedule for the previous taxable year. 17 * Sec. 4. AS 21.56.120 is amended by adding a new subsection to read: 18 (e) In determining the premium rates for a small employer covered under an 19 association health insurance policy authorized under AS 21.54.060(7), a small 20 employer insurer may not use the claims experience of the small employer while the 21 employer was covered under another health insurance policy and may use only that 22 underwriting information obtained through the insurer's normal application process for 23 new small employer groups that are not written under the association plan. 24 * Sec. 5. This Act takes effect July 1, 2004.