Bill Text: HI HB1991 | 2016 | Regular Session | Amended

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Bill Title: Homeowners Insurance Claims; Property Insurance

Spectrum: Moderate Partisan Bill (Democrat 5-1)

Status: (Introduced - Dead) 2016-02-17 - The committee(s) on CPC recommend(s) that the measure be deferred. [HB1991 Detail]

Download: Hawaii-2016-HB1991-Amended.html

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HOUSE OF REPRESENTATIVES	H.B. NO.	1991
TWENTY-EIGHTH LEGISLATURE, 2016		H.D. 1
STATE OF HAWAII		PROPOSED

A BILL FOR AN ACT

 

 

RELATING TO INSURANCE.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  The purpose of this Act is to facilitate the establishment of health savings accounts in the State and require employers to make contributions to health savings accounts, which receive favorable tax treatment in that the contributions may be accumulated over the years, or distributed on a tax-free basis, to pay or reimburse qualifying medical expenses.

     SECTION 2.  Chapter 431, Hawaii Revised Statutes, is amended by adding a new section to article 10A to be appropriately designated and to read as follows:

     "§431:10A-    Health savings account program; limitations; definitions.  (a)  Each group accident and health or sickness insurance policy issued or renewed in this State after July 1, 2016, may include an option for a group health savings program.

     (b)  An employer subject to chapter 393 may offer a health savings account program to employees in addition to the group accident and health or sickness insurance policy provided by an insurer.  An employer offering a health savings account program shall be subject to the following limitations.  The employer shall:

     (1)  Provide the program to employees only as an alternative option to a group accident and health or sickness insurance policy, in which both the program and the group accident and health or sickness insurance policy provide aggregate benefits that are determined pursuant to chapter 393 to be equivalent and meet the qualifications in either subsection 393-7(a) or (b);

     (2)  Make an annual employer contribution to the health savings account of an employee enrolled in the program, and upon enrollment of a new employee that enrolls in the program;

     (3)  Make an employer contribution of an amount equal to or greater than eighty per cent of the annual deductible of a high deductible health plan for self-only coverage and equal to or greater than eighty per cent of the annual deductible of a high deductible health plan for family coverage, with the total annual employer contribution not to exceed the maximum contribution amount pursuant to section 223 of the Internal Revenue Code of 1986;

     (4)  Contribute the annual amount to the employee's health savings account prior to the first day the employee is covered by the program;

     (5)  Increase the contribution amount to an employee's health savings account if an employee's status changes from self-only coverage to family coverage during program;

     (6)  Cooperate with the insurer regarding proof of compliance with the limitations for offering a health savings account program to employees;

     (7)  Provide the declaration of understanding from the insurer with the program application;

     (8)  Provide the certification obtained from the insurer regarding the employer's compliance with the limitations of the program to the insurer; and

     (9)  Immediately remove any employee and dependents, if any, from the program and place the employee and dependents, if any, in the group accident and health or sickness insurance policy if the employer knows the program is not in compliance with this section, by notifying the insurer immediately.

     (c)  Every insurer that offers, sells, or renews a group accident and health or sickness insurance policy with an option for a health savings account program shall:

     (1)  Include the employer limitations in this section in any policy, contract, certificate, or agreement, regardless of form;

     (2)  Encourage informed decisions by providing employers a one-page, double-sided declaration of understanding, to be included with any program application that explains in plain and simple language certain terms of the program, including covered services, applicable deductibles, claims processing, and the effective use of the program for favorable tax treatment;

     (3)  Retain the employer's certification as to compliance with the limitations of the program for five years; and

     (4)  Submit to the insurance commissioner, no later than June 30 of each calendar year, a statewide basis report in such form and detail as the insurance commissioner shall prescribe, on the preceding calendar year stating the participation rate, the total dollars contributed by employers, the total dollars contributed by employees and the disbursement of the deposits as a percentage of the deposits in the health savings accounts.

     (d)  Unused funds in a health savings account shall become the property of the health savings account holder at the end of a taxable year.

     (e)  Notwithstanding any provision of law to the contrary, the rights of an employee or dependent, if any, of a health savings account to hold or to receive moneys paid into or out of, the assets of, and the income of the health savings account:

     (1)  Shall be exempt from creditor process;

     (2)  Shall not be liable to attachment, garnishment, or other process; and

     (3)  Shall not be seized, taken, appropriated, or applied by any legal or equitable process or operation of law to pay any debt or liability of the employee or beneficiary of the account.

     (f)  If this section or any provision of this section conflicts at any time with any federal law, then the federal law shall prevail and this article or the relevant provisions of this section shall become ineffective and invalid.  The ineffectiveness or invalidity of this section or any of its provisions shall not affect any other provisions or applications of this section, which shall be given effect without the invalid provision or application, and to this end, the provisions of this section are severable.

     (g)  As used in this section, unless the context clearly requires otherwise:

     "Family coverage" shall have the same meaning as defined in section 223 of the Internal Revenue Code of 1986.

     "Health savings account" means a health savings account authorized under section 223 of the Internal Revenue Code of 1986.

     "Health savings account program" or "program" means a high deductible health plan with a health savings account that has been approved pursuant to chapter 393 to be offered, sold or renewed with an employer-sponsored plan to an employer subject to chapter 393.

     "High deductible health plan" shall have the same meaning as defined in section 223 of the Internal Revenue Code of 1986.

     "Self-only coverage" means coverage only for the employee and not for dependents."

     SECTION 3.  Chapter 432, Hawaii Revised Statutes, is amended by adding a new section to article 1 to be appropriately designated and to read as follows:

     "§432:1-    Health savings account program; limitations; definitions.  (a)  Each group hospital and medical service plan contract issued or renewed in this State after July 1, 2016, may include an option for a group health savings program.

     (b)  An employer subject to chapter 393 may offer a health savings account program to employees in addition to the group hospital and medical service plan contract provided by a mutual benefit society.  An employer offering a health savings account program shall be subject to the following limitations.  The employer shall: 

     (1)  Provide the program to employees only as an alternative option to a group hospital and medical service plan contract, in which both the program and the group hospital and medical service plan contract provide aggregate benefits that are determined pursuant to chapter 393 to be equivalent and meet the qualifications in either subsection 393-7(a) or (b);

     (2)  Make an annual employer contribution to the health savings account of an employee enrolled in the program, and upon enrollment of a new employee that enrolls in the program;

     (3)  Make an employer contribution of an amount equal to or greater than eighty per cent of the annual deductible of a high deductible health plan for self-only coverage and equal to or greater than eighty per cent of the annual deductible of a high deductible health plan for family coverage, with the total annual employer contribution not to exceed the maximum contribution amount pursuant to section 223 of the Internal Revenue Code of 1986;

     (4)  Contribute the annual amount to the employee's health savings account prior to the first day the employee is covered by the program;

     (5)  Increase the contribution amount to an employee's health savings account if an employee's status changes from self-only coverage to family coverage during program;

     (6)  Cooperate with the mutual benefit society regarding proof of compliance with the limitations for offering a health savings account program to employees;

     (7)  Provide the declaration of understanding from the mutual benefit society with the program application;

     (8)  Provide the one-page, double-sided declaration of understanding from the mutual benefit society with the program application;

     (9)  Provide the certification obtained from the mutual benefit society as to the employer's compliance with the limitations of the program to the mutual benefit society; and

    (10)  Immediately remove any employee and dependents, if any, from the program and place the employee and dependents, if any, in the group hospital and medical service plan contract if the employer knows the program is not in compliance with this section, by notifying the mutual benefit society immediately.

     (c)  Every mutual benefit society that offers, sells, or renews a group hospital and medical service plan contract with an option for a health savings account program shall:

     (1)  Include the employer limitations in this section in any policy, contract, certificate, or agreement, regardless of form;

     (2)  Encourage informed decisions by providing employers a one-page, double-sided declaration of understanding, to be included with any program application that explains in plain and simple language certain terms of the program, including covered services, applicable deductibles, claims processing, and the effective use of the program for favorable tax treatment;

     (3)  Retain the employer's certification as to compliance with the limitations of the program for five years; and

     (4)  Submit to the insurance commissioner, no later than June 30 of each calendar year, a statewide basis report in such form and detail as the insurance commissioner shall prescribe, on the preceding calendar year stating the participation rate, the total dollars contributed by employers, the total dollars contributed by employees and the disbursement of the deposits as a percentage of the deposits in the health savings accounts.

     (d)  Unused funds in a health savings account shall become the property of the health savings account holder at the end of a taxable year.

     (e)  Notwithstanding any provision of law to the contrary, the rights of an employee or dependent, if any, of a health savings account to hold or to receive moneys paid into or out of, the assets of, and the income of the health savings account:

     (1)  Shall be exempt from creditor process;

     (2)  Shall not be liable to attachment, garnishment, or other process; and

     (3)  Shall not be seized, taken, appropriated, or applied by any legal or equitable process or operation of law to pay any debt or liability of the employee or beneficiary of the account.

     (f)  If this section or any provision of this section conflicts at any time with any federal law, then the federal law shall prevail and this section or the relevant provisions of this section shall become ineffective and invalid.  The ineffectiveness or invalidity of this section or any of its provisions shall not affect any other provisions or applications of this section, which shall be given effect without the invalid provision or application, and to this end, the provisions of this section are severable.

     (g)  As used in this section, unless the context clearly requires otherwise:

     "Family coverage" shall have the same meaning as defined in section 223 of the Internal Revenue Code of 1986.

     "Health savings account" means a health savings account authorized under section 223 of the Internal Revenue Code of 1986.

     "Health savings account program" or "program" means a high deductible health plan with a health savings account that has been approved pursuant to chapter 393 to be offered, sold or renewed with an employer-sponsored plan to an employer subject to chapter 393.

     "High deductible health plan" shall have the same meaning as defined in section 223 of the Internal Revenue Code of 1986.

     "Self-only coverage" means coverage only for the employee and not for dependents."

     SECTION 4.  Section 432D-23, Hawaii Revised Statutes, is amended to read as follows:

     "§432D-23  Required provisions and benefits.  Notwithstanding any provision of law to the contrary, each policy, contract, plan, or agreement issued in the State after January 1, 1995, by health maintenance organizations pursuant to this chapter, shall include benefits provided in sections 431:10-212, 431:10A-115, 431:10A-115.5, 431:10A-116, 431:10A-116.2, 431:10A-116.5, 431:10A-116.6, 431:10A-119, 431:10A-120, 431:10A-121, 431:10A-122, 431:10A-125, 431:10A-126, 431:10A-132, 431:10A-133, [and] 431:10A-140, 431:10A-   if a health savings account is provided, and chapter 431M."

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  Notwithstanding section 432D-23, Hawaii Revised Statutes, the group health savings account program to be provided by a health maintenance organization under section 4 of this Act shall apply to all group policies, contracts, plans, or agreements issued or renewed in this State by a health maintenance organization after July 1, 2016.

     SECTION 7.  This Act shall take effect on July 1, 2016.

 

Report Title:

Health Savings Account Program; Insurance

 

Description:

Facilitates the establishment of health savings accounts in Hawaii. (HD1 Proposed)

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.