Connecticut Seal

General Assembly

File No. 212

    January Session, 2017

Senate Bill No. 924

Senate, March 23, 2017

The Committee on Insurance and Real Estate reported through SEN. LARSON of the 3rd Dist. and SEN. KELLY of the 21st Dist., Chairpersons of the Committee on the part of the Senate, that the bill ought to pass.

AN ACT REQUIRING THAT HEALTH CARRIERS USING THE CONNECTICUT HEALTH INSURANCE EXCHANGE PAY A MINIMUM COMMISSION TO CERTAIN INSURANCE PRODUCERS.

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

Section 1. Section 38a-1080 of the general statutes is repealed and the following is substituted in lieu thereof (Effective January 1, 2018):

For purposes of sections 38a-1080 to 38a-1093, inclusive, and section 2 of this act:

(1) "Board" means the board of directors of the Connecticut Health Insurance Exchange;

(2) "Commissioner" means the Insurance Commissioner;

(3) "Exchange" means the Connecticut Health Insurance Exchange established pursuant to section 38a-1081;

(4) "Affordable Care Act" means the Patient Protection and Affordable Care Act, P.L. 111-148, as amended by the Health Care and Education Reconciliation Act, P.L. 111-152, as both may be amended from time to time, and regulations adopted thereunder;

(5) (A) "Health benefit plan" means an insurance policy or contract offered, delivered, issued for delivery, renewed, amended or continued in the state by a health carrier to provide, deliver, pay for or reimburse any of the costs of health care services.

(B) "Health benefit plan" does not include:

(i) Coverage of the type specified in subdivisions (5), (6), (7), (8), (9), (14), (15) and (16) of section 38a-469 or any combination thereof;

(ii) Coverage issued as a supplement to liability insurance;

(iii) Liability insurance, including general liability insurance and automobile liability insurance;

(iv) Workers' compensation insurance;

(v) Automobile medical payment insurance;

(vi) Credit insurance;

(vii) Coverage for on-site medical clinics; or

(viii) Other similar insurance coverage specified in regulations issued pursuant to the Health Insurance Portability and Accountability Act of 1996, P.L. 104-191, as amended from time to time, under which benefits for health care services are secondary or incidental to other insurance benefits.

(C) "Health benefit plan" does not include the following benefits if they are provided under a separate insurance policy, certificate or contract or are otherwise not an integral part of the plan:

(i) Limited scope dental or vision benefits;

(ii) Benefits for long-term care, nursing home care, home health care, community-based care or any combination thereof; or

(iii) Other similar, limited benefits specified in regulations issued pursuant to the Health Insurance Portability and Accountability Act of 1996, P.L. 104-191, as amended from time to time;

(iv) Other supplemental coverage, similar to coverage of the type specified in subdivisions (9) and (14) of section 38a-469, provided under a group health plan.

(D) "Health benefit plan" does not include coverage of the type specified in subdivisions (3) and (13) of section 38a-469 or other fixed indemnity insurance if (i) such coverage is provided under a separate insurance policy, certificate or contract, (ii) there is no coordination between the provision of the benefits and any exclusion of benefits under any group health plan maintained by the same plan sponsor, and (iii) the benefits are paid with respect to an event without regard to whether benefits were also provided under any group health plan maintained by the same plan sponsor;

(6) "Health care services" has the same meaning as provided in section 38a-478;

(7) "Health carrier" means an insurance company, fraternal benefit society, hospital service corporation, medical service corporation, health care center or other entity subject to the insurance laws and regulations of the state or the jurisdiction of the commissioner that contracts or offers to contract to provide, deliver, pay for or reimburse any of the costs of health care services;

(8) "Internal Revenue Code" means the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time;

(9) "Person" has the same meaning as provided in section 38a-1;

(10) "Qualified dental plan" means a limited scope dental plan that has been certified in accordance with subsection (e) of section 38a-1086;

(11) "Qualified employer" has the same meaning as provided in Section 1312 of the Affordable Care Act;

(12) "Qualified health plan" means a health benefit plan that has in effect a certification that the plan meets the criteria for certification described in Section 1311(c) of the Affordable Care Act and section 38a-1086;

(13) "Qualified individual" has the same meaning as provided in Section 1312 of the Affordable Care Act;

(14) "Secretary" means the Secretary of the United States Department of Health and Human Services;

(15) "Small employer" has the same meaning as provided in section 38a-564.

Sec. 2. (NEW) (Effective January 1, 2018) (a) For purposes of this section, "insurance producer" has the same meaning as provided in section 38a-702a of the general statutes.

(b) Any health carrier that delivers, issues for delivery, renews, amends or continues a qualified health plan through the exchange shall pay a reasonable commission to the insurance producer who, on or after January 1, 2018, assisted an individual or a small employer to evaluate the qualified health plans offered through the exchange and select such a plan.

(c) The exchange shall establish a schedule of reasonable commissions that health carriers shall pay to insurance producers under subsection (b) of this section.

(d) (1) The exchange shall establish and maintain a complaint system to provide reasonable procedures for the resolution of a written complaint initiated by an insurance producer concerning a health carrier's failure to comply with subsection (b) of this section. The exchange shall maintain records of all written complaints initiated by insurance producers under this subdivision.

(2) The commissioner may examine the complaint and recordkeeping systems established by the exchange under subdivision (1) of this subsection and, if the commissioner determines that such systems are inadequate, may, by regulation, require that the exchange revise such systems.

(3) The chief executive officer of the exchange shall provide to the commissioner the name of any health carrier that fails to comply with subsection (b) of this section.

(4) The commissioner shall see that all laws respecting the authority of the exchange pursuant to subsection (b) of this section are faithfully executed. The commissioner has all the powers specifically granted under title 38a of the general statutes and all further powers that are reasonable and necessary to enable the commissioner to enforce the provisions of said subsection (b).

(5) Any health carrier aggrieved by any order or decision of the commissioner under subdivision (4) of this subsection may appeal therefrom in accordance with section 38a-19 of the general statutes.

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

Section 1

January 1, 2018

38a-1080

Sec. 2

January 1, 2018

New section

INS

Joint Favorable

 

The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.


OFA Fiscal Note

State Impact: None

Municipal Impact: None

Explanation

The bill does not result in a fiscal impact to the state or municipalities as the bill requires the commission to be paid by the health carrier to the licensed insurance producer. In addition, the bill does not result in a cost to the Department of Insurance as the requirements of the bill are within the agency's expertise.

The Out Years

State Impact: None

Municipal Impact: None

OLR Bill Analysis

SB 924

AN ACT REQUIRING THAT HEALTH CARRIERS USING THE CONNECTICUT HEALTH INSURANCE EXCHANGE PAY A MINIMUM COMMISSION TO CERTAIN INSURANCE PRODUCERS.

SUMMARY

This bill requires a health carrier (e.g., insurer or HMO) that delivers, issues, renews, amends, or continues qualified health plans through the Connecticut Health Insurance Exchange (i.e., Access Health CT) to pay a reasonable commission to a licensed insurance producer who helps an individual or small employer evaluate and select such a plan.

The bill requires the exchange to establish (1) the commissions a carrier will pay and (2) a complaint system for resolving insurance producers' complaints that a carrier is not paying commissions as required. The exchange must maintain records of any written complaints received from producers. The bill authorizes the insurance commissioner to examine the exchange's complaint and recordkeeping systems and if she determines they are inadequate, issue regulations requiring the exchange to revise the systems.

The bill requires the exchange's chief executive officer to give the commissioner the name of any carrier failing to pay reasonable commissions as required. It gives the commissioner the power to enforce the requirement. Under the bill, any carrier aggrieved by her order or decision may appeal to her and request a hearing. Further orders and decisions may be appealed to Superior Court.

EFFECTIVE DATE: January 1, 2018

BACKGROUND

Access Health CT Resolutions

At its January 26, 2017 board of directors' special meeting, Access Health CT's board passed two resolutions requiring carriers that offer plans through the exchange to pay a commission to an insurance producer who helps consumers enroll in a qualified health plan. The commission must be the same dollar amount as that paid to producers who help consumers enroll in plans sold off the exchange. The resolutions are effective beginning for plans sold in 2018.

COMMITTEE ACTION

Insurance and Real Estate Committee

Joint Favorable

Yea

19

Nay

0

(03/09/2017)

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