Connecticut Seal

General Assembly

 

Raised Bill No. 5444

February Session, 2016

 

LCO No. 1267

 

*01267_______INS*

Referred to Committee on INSURANCE AND REAL ESTATE

 

Introduced by:

 

(INS)

 

AN ACT CONCERNING THE EXECUTION OF SURETY BONDS BY THE CONNECTICUT HEALTH INSURANCE EXCHANGE.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Subsection (c) of section 38a-1081 of the 2016 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2016):

(c) (1) All initial appointments shall be made not later than July 1, 2011. Following the expiration of such initial terms, subsequent board member terms shall be for four years. Any vacancy shall be filled by the appointing authority for the balance of the unexpired term. If an appointing authority fails to make an initial appointment, or an appointment to fill a vacancy within ninety days of the date of such vacancy, the appointed board members may make such appointment by a majority vote. Any board member previously appointed to the board or appointed to fill a vacancy may be reappointed in accordance with this section. Any board member may be removed for misfeasance, malfeasance or wilful neglect of duty at the sole direction of the appointing authority.

(2) As a condition of qualifying as a member of the board of directors, each appointee shall, before entering upon such member's duties, take and subscribe the oath or affirmation required under section 1 of article eleventh of the Constitution of the state. A record of each such oath shall be filed in the office of the Secretary of the State.

(3) Appointed board members may not designate a representative to perform in their absence their respective duties under sections 38a-1080 to 38a-1092, inclusive. The Governor shall select a chairperson from among the board members and the board members shall annually elect a vice-chairperson. Meetings of the board of directors shall be held at such times as shall be specified in the bylaws adopted by the board and at such other time or times as the chairperson deems necessary. Any board member who fails to attend more than fifty per cent of all meetings held during any calendar year shall be deemed to have resigned from the board.

(4) Six board members shall constitute a quorum for the transaction of any business or the exercise of any power of the exchange. For the transaction of any business or the exercise of any power of the exchange, the exchange may act by a majority of the board members present at any meeting at which a quorum is in attendance. No vacancy in the membership of the board of directors shall impair the right of such board members to exercise all the rights and perform all the duties of the board. Except as otherwise provided in sections 38a-1080 to 38a-1092, inclusive, any action taken by the board under the provisions of sections 38a-1080 to 38a-1092, inclusive, may be authorized by resolution approved by a majority of the board members present at any regular or special meeting, which resolution shall take effect immediately unless otherwise provided in the resolution.

(5) Board members shall receive no compensation for their services but shall receive actual and necessary expenses incurred in the performance of their official duties.

(6) Subject to the provisions of subdivision (2) of subsection (b) of this section, board members may engage in private employment or in a profession or business, subject to any applicable laws, rules and regulations of the state or federal government regarding official ethics or conflicts of interest.

(7) Notwithstanding any provision of the general statutes, it shall not constitute a conflict of interest for a trustee, director, partner or officer of any person, firm or corporation, or any individual having a financial interest in a person, firm or corporation, to serve as a board member of the exchange, provided such trustee, director, partner, officer or individual shall abstain from deliberation, action or vote by the exchange in specific request to such person, firm or corporation.

(8) Each board member shall execute a surety bond in the penal sum of fifty thousand dollars, or, in lieu thereof, the chairperson of the board shall execute a blanket position bond or procure an equivalent insurance product covering each board member, the chief executive officer and the employees of the exchange, each surety bond or equivalent insurance product to be conditioned upon the faithful performance of the duties of the office or offices covered, to be executed by a surety company or issued by an insurance company authorized to transact business in this state as surety [and to be approved by the Attorney General and filed in the office of the Secretary of the State] or an insurance company, respectively. The cost of each such bond or insurance product shall be paid by the exchange.

(9) No board member of the exchange shall, for one year after the end of such member's service on the board, accept employment with any health carrier that offers a qualified health benefit plan through the exchange.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2016

38a-1081(c)

Statement of Purpose:

To authorize the Connecticut Health Insurance Exchange to procure an insurance product equivalent to the surety bond required for its board members, chief executive officer and employees, and eliminate the requirement that such surety bond or equivalent insurance product be approved by the Attorney General and filed in the office of the Secretary of the State.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]