Obamacare relief.

WORKING DRAFT
2014
STATE OF
WYOMING
14LSO-0206

SENATE FILE
NO.
SF0108

Obamacare relief.

Sponsored by:
Senator(s) Scott, Anderson, J.L. (SD28) and Craft and Representative(s) Barlow

A BILL

for

AN ACT relating to
healthcare
coverage; protecting the public health from lack of
healthcare
coverage as specified; providing relief for people deprived of affordable
healthcare
coverage by the federal law and regulations known as "Obamacare" or as "The Affordable Care Act"; providing for the necessary
healthcare
support
of the poor as specified: providing as specified health coverage for people who cannot otherwise obtain it on an affordable basis; creating the Obamacare temporary relief program
and
expanding the coverage options under the Wyoming Health Insurance Pool Act; creating the Wyoming temporary medical welfare program; creating the Wyoming small business healthcare relief program and modifying the definition of small business for insurance purposes; modifying the sunset dates for the Wyoming health insurance pool and programs within the pool;
providing a sunset date for this act;
providing enrollees must be given written notice that the coverage offered, while legal, does not comply with the federal law applying to insurance coverage; redirecting existing appropriations and revenue flows;
amending a prior appropriation;
providing appropriation
s
; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.

W.S. 26
‑
18
‑
401 through 26
‑
18
‑
413 are created to read:

ARTICLE 4
OBAMACARE RELIEF

26
‑
18
‑
401.

Obamacare Relief
Act; short title.

This act shall be known and may be cited as the "
Obamacare Relief
Act".

26
‑
18
‑
402.

Definitions.

(a)

For purposes of this act:

(i)

"Administrator" means the administrator of the Wyoming health insurance pool selected pursuant to W.S. 26
‑
43
‑
104;

(ii)

"Agents" means insurance agents, producers and brokers
;

(
i
ii)

"Board" means the board of directors of the pool;

(i
v
)

"Creditable coverage" means health insurance coverage which qualifies as creditable coverage under the federal Health Insurance Portability and Accountability Act of 1996, 42 U.S.C. § 300gg-3;

(v)

"Insurance exchange" or "exchange" means the American health benefit exchange established for residents of Wyoming pursuant to Obamacare;

(v
i
)

"Obamacare" means the programs created by the Patient Protection and Affordable Care Act, P.L. 111-148, together with the
Health Care
and Education Reconciliation Act, P.L. 111-152;

(v
i
i)

"Pool" means the Wyoming health insurance pool created by W.S. 26
‑
43
‑
102;

(vi
i
i)

"WTMWP" means the Wyoming temporary medical welfare program established by this act
;

(ix)

"Using tobacco" means using, including within the year prior to enrollment, any form of combusted tobacco or smokeless tobacco but does not include using electronic cigarettes
;

(x)

"This act" means W.S. 26
‑
18
‑
401 through 26
‑
18
‑
41
3
.

26
‑
18
‑
403.

General provision.

(a)

No person shall be compelled to enroll or penalized for failure to enroll in any program pursuant to this act.

(b)

Except for individuals for whom no coverage is available through the exchange, no individual is eligible to enroll in a program under this act unless the premiums fo
r
the least expensive plan available through the exchange
exceed eight percent (8%) of the individual's income as defined by
26 U.S.C. §
5000A
.

(c)

Premiums collected pursuant to this act and investment income earned may be used to pay claims and expenses including administrative expenses of the programs authorized by this act. The board shall set forth the mechanisms for managing this provision and other needed financial arrangements in the plan of operations for each program authorized by this act.

(d)

The board may increase premiums charged under this act for individuals who use tobacco by up to twenty-five percent (25%) for individuals under the age of fort
y
(40) and by up to fifty percent (50%) for individuals age forty (40) and above.

26
‑
18
‑
404.

Obamacare temporary relief program.

(a)

The Obamacare temporary relief program is created for:

(i)

Individuals
not eligible for Medicare whose cost of insurance exceeds the limit set forth in W.S. 26
‑
18
‑
403(b)
except that:

(A)

For individuals forty (40) years old but less than fifty (50) years old using tobacco, the applicable percentage shall be ten percent (10%) of the individual's income;

(B)

For individuals fifty (50) years old or older using tobacco, the applicable percentage shall be twelve percent (12%) of the
individual's income
.

26
‑
18
‑
40
5
.

Closed exchange enrollment
temporary relief program.

(a)

The closed exchange enrollment temporary relief program is created for those individuals who wish to purchase health coverage but cannot purchase private health insurance either directly or through the exchange due to the federal regulations relating to open and closed enrollment periods.
Individuals who are eligible by federal law and regulation to purchase coverage during a federal closed enrollment period are not eligible to
purchase through the program provided by this section. The program provided by this section shall be available only if the insurance commissioner certifies that policies to meet this need are not available in the private market.

(b)

Coverage under the program created by this section may be purchased only during a federal closed enrollment period and shall terminate at the end of the next federal open enrollment period. This coverage shall exclude all preexisting conditions unless the individual has had creditable coverage within the past one hundred twenty (120) days before enrolling.

(c)

For coverage issued under this section during 2014 only, creditable coverage shall include coverage in effect at any time between September 1, 2013 and November 1, 2013.

26
‑
18
‑
40
6
.

Wyoming temporary medical welfare
program.

The Wyoming temporary medical welfare program is created for individuals who are not eligible for subsidies through the Obamacare exchange
due to poverty and are not eligible for coverage under the Medicaid or child health insurance
program. Adults capable of working in a single or double person household or two
(2)
adults capable of working plus a single dependent in a household are not eligible to participate in this program. The disability standard for supplemental securing income shall be used to determine whether an adult is capable of working. The administrator shall report to the
joint labor, health and social services interim committee
if the households made unable to participate in this program pursuant to this section are no longer able to qualify for subsidies through the exchange by working approximately forty (40) hours per week
.

26
‑
18
‑
40
7
.

Obamacare temporary relief program; coverages.

(a)

To the extent feasible and consistent with this act, coverages provided under this act shall be as provided in the Wyoming Health Insurance Pool Act using the benefit design for a program with a higher deductible option or a health savings account option as provided in W.S. 26
‑
43
‑
106(b)(ii). Specific provisions shall include:

(i)

Annual limits as used

as of March 1, 2010
,
either as annual or lifetime limits
for products under the Wyoming Health Insurance Pool Act;

(ii)

W
ellness benefits
only as mandated by Wyoming law;

(iii)

A
premium structure designed to recover the costs of the program plus a reasonable allowance for adverse selection
,
assuming a normal population
and without regard to
regulations on insurance pricing
under Obamacare
. Until the board can price the product consistent with this section, the price shall be twenty percent (20%) less than the average silver plan available through the exchange
;

(iv)

A preexisting condition exclusion for ten (10) months if an insured has not had creditable coverage
within one hundred twenty (120) days of enrolling. For 2014 only, creditable coverage between September 1, 2013
,
and October
1, 2013
,
shall be deemed adequate to avoid a preexisting condition period
;

(v)

D
eductibles
,
copayments and out of pocket
annual
maximum
s
consistent with a
catas
troph
i
c coverage
program assuming covered indi
viduals will be able to pay non
catastrophic medical expenses from earnings plus a prudent ca
sh
emergency fund
.

26
‑
18
‑
40
8
.

Wyoming closed enrollment temporary relief program; coverages.

(a)

For policies sold in 2014, coverage under the Wyoming closed enrollment temporary relief program shall be as provided in the benefit design developed pursuant to W.S 26
‑
43
‑
203 with the following exceptions:

(i)

There shall be no provision for contributions to or use of a personal health account;

(ii)

Wellness benefits shall be limited to those required by Wyoming law
; and

(iii)

All preexisting conditions shall be excluded from coverage except for primary care visits and medications authorized for chronic conditions and recommended by the primary care physician unless the individual had creditable health insurance coverage within
one hundred twenty (120) days of enrollment or, for 2014
only, between September 1, 2013
,
and October 1, 2013
.

(b)

Premiums shall reflect the full cost of the policies to the extent that cost can be rapidly estimated.

(c)

Benefits for the duration of a policy under this section shall be limited to a cumulative amount of one hundred thousand dollars ($100,000.00).

(d)

For policies sold after 2014, the Wyoming health insurance pool board may modify the coverage to better meet the needs of the customers, but may not change the limit under subsection (
c
) of this section, the mandatory expiration date of the policy or the preexisting condition limitations without prior legislative approval.

26
‑
18
‑
4
09
.

Wyoming temporary medical welfare program; coverages.

(a)

Coverage under the WTMWP shall be as provided in the benefit design developed pursuant to W.S. 26
‑
43
‑
201 through 26
‑
43
‑
204
and in effect on January 1, 2012
, with the following exceptions:

(i)

Wellness benefits shall be limited to those required by Wyoming law or recommended by the primary care medical home physician;

(ii)

Mental health coverage shall be limited to services provided by the primary care medical home physician and prescription drugs as provided in the benefit design.

(b)

If an individual participating in the Wyoming temporary medical welfare program becomes eligible for Medicaid, the administrator may in its discretion either:

(i)

Counsel the individual to enroll in Medicaid if the
administrator
believes that is in the individual's best interest; or

(ii)

Transfer the individual to Medicaid if the
administrator
believes that is in the financial interest of the state, provided the individual is given the option to withdraw from the program and not enroll in Medicaid.

(c)

If the individual participating in the WTMWP becomes eligible for subsidized coverage through the exchange
,
the state may counsel the individual to obtain coverage through the exchange if it is in his interest to do so and leave the program. The decision to leave the program shall be in the participating individual's sole discretion unless the individual's income has reached two hundred fifty percent (250%) of the federal poverty level, in which case continued participation in the program shall be pursuant to W.S. 26
‑
43
‑
204(e).

(d)

T
he administrator of the WTMWP shall seek to review continued eligibility of participants during the sixty (60) days prior to the expected open enrollment period for the exchange.

26
‑
18
‑
41
0
.

Premiums.

(a)

Participants in the Obamacare temporary relief program shall pay the full actuarial cost of
the
coverage
once it has been determined. Until it has been determined, participants shall pay a
p
remium that is twenty percent (20%) less than the average silver plan premium offered on the exchange.

(b)

Participants in the WTMWP shall contribute toward the cost of coverage through the Wyoming health insurance pool an amount equal to one-half of one percent (.5%)
of income from wages subject to social security taxes
.
This contribution shall be deposited in the individuals personal health account.

26
‑
18
‑
41
1
.

Administration.

(a)

Except as provided by subsection (e) of this section, t
he administration and management of all programs under this act shall be the responsibility of the pool administrator selected pursuant to W.S. 26
‑
43
‑
104.

(b)

If the administrator is also an insurance company selling health insurance policies in this state, the apparent conflict of interest between the roles shall not be an obstacle to the employment of the administrator because the state is seeking to utilize that conflict to see that the coverage sold pursuant to this act does not sabotage the federal program by causing material adverse selection for Obamacare compliant policies sold through the exchange or in the private market.

(
c
)

The administrator shall develop a plan of operations for each of the programs under this act. To the extent possible, the plans shall use the existing plan of operation of the pool. The plan for any program shall be approved by the board before implementation of the program.

(
d
)

Primary responsibility for enrollment of individuals in the WTMWP shall be with the department of family services using the same staff who enroll individuals in other means

tested programs. The plan of operations may allow enrollment by pool staff and by Wyoming insurance agents and producers.

(
e
)

For the Obamacare temporary relief program and the Wyoming closed enrollment temporary relief program, enrollment shall be as currently done for the pool and
, in addition, the board
shall:

(i)

A
ppoint Wyoming insurance agents to sell
or refer
the program products using appropriate commissions
or referral fees
;

(ii)

Set
the agents'
commissions and
referral fees authorized under W.S. 26
‑
43
‑
102(d)(iv) to ensure the fees provide the agents with sufficient compensation to cover expenses they may reasonably incur, including time spent counseling potential enrollees
except that, where relevant, the commissions or referral fees shall be less than the agent would earn selling an obamacare compliant policy
;
and

(iii)

Advise agents offering products authorized in this act that:

(A)

These policies are inferior to Obamacare compliant policies in that they offer reduced benefits;

(B)

It is the policy of the state to encourage individuals who can afford it to buy Obamacare compliant policies because they offer better coverage;

(C)

It is the policy of the state to avoid causing adverse selection for Obamacare compliant policies, so the state does not want to sell less expensive policies
to people who would otherwise buy Obamacare compliant policies; and

(D)

The state is seeking to se
l
l these policies to people who cannot afford or will
not
buy an Obamacare compliant policy. The state is seeking to avoid an increase in the number of people without health coverage and to provide people who would otherwise be without coverage, with coverage they can afford and will buy.

(f)

If the board discovers under certain circumstances an Obamacare compliant policy legally offered outside the exchange has lower premiums than the least expensive policy offered through the exchange, the board may substitute that premium for the one otherwise used for the determination under
W
.S. 26
‑
18
‑
403(b).

(
g
)

The board may negotiate an addition to its existing contract with the pool administrator or may obtain a different administrator for the programs created by this act. If the board selects a different administrator, the board shall make a public solicitation on a short time frame including, in its sole discretion, invitation to bid to known potential administrators and the current pool
administrator. The board in selecting an administrator shall not be bound by state procurement rules adopted pursuant to W.S. 9
‑
2
‑
1016.

(
h
)

It shall be the duty of the board to manage the programs under this act so that expenses do not exceed available appropriations, premiums received and any other state funds received. The board shall attempt to avoid using the resources of the pool, but may use these resources including the assessments provided by W.S. 26
‑
43
‑
105 if expenses exceed estimates.

(j)

The commissioner shall organize a marketing committee of not more than seven (7) voting members to advise the
board, its administrator and the commissioner concerning the marketing of policies offered pursuant to this act. The two
(2)
companies offering medical policies on the Wyoming exchange as of January 1, 2014
,
shall both be invited to name a member and not more than four (4) additional companies shall be invited to name a member of the committee. The commissioner may invite the regional administrator of the United Stated department of health and human services to name a member of the committee. The commissioner or his designee from the insurance department
shall serve as an ex

officio nonvoting member of the committee. The commissioner or his designee shall serve as chairman of the committee unless the commissioner appoints a voting member of the committee to serve as chairman.

26
‑
18
‑
41
2
.

Notice to enrollees.

(a)

All persons enrolling in a program under this act shall be notified in writing that:

(i)

The health coverage offered
th
r
ough the
program does not meet the standards set forth in the federal law and regulations for health insurance and that coverage through the federal exchanges or in the private insurance market will be more comprehensive
;

(ii)

The coverage offered through th
e
program can avoid meeting the federal standards because it is provided by a Wyoming state program which is immune from the federal regulations by both federal law and by the United States Cons
t
itution
;

(
iii
)

The coverage offered by th
e
program is intended to be a temporary stop gap offered because too
many people cannot obtain coverage meeting the federal standards or c
a
nnot afford coverage compliant with federal law. Once the problems with the federal law are fixed, the
s
tate of Wyoming intends to discontinue this program and return those with coverage through it to the normal insurance market; and

(
iv)

The state of Wyoming believes that, due to the income limitations on who may purchase coverage through this program, that anyone who
purchases
coverage through this act is exempt from any penalty under federal law for not having insurance coverage, and would be exempt regardless of whether they purchase this coverage through this state of Wyoming program
;

(v)

F
or those enrolled in the Wyoming
t
emporary
m
edical
w
elfare program, mental health coverage is limited because individuals eligible for this program can obtain mental
healthcare
through state funded local community mental health centers for no fee or a nominal fee.

(b)

The board may add to or amend the disclaimers provided in subsection (a) of this section, except that it
shall not eliminate or amend the disclaimer in paragraph (a)(iii)
of this section
.

26
‑
18
‑
41
3
.

Sunset.

W.S. 26
‑
18
‑
401 through 26
‑
18
‑
412 are re
pealed
effective December 31, 2018.

Section 2.

W.S. 26
‑
19
‑
302(a)(xxii)
, 26
‑
19
‑
304 by creating a new subsection (f),

26
‑
19
‑
311,
26
‑
19
‑
312(a),
26
‑
43
‑
103(b)(i)
, 26
‑
43
‑
113 and 26
‑
43
‑
207 are
amended to read:

26
‑
19
‑
302.

Definitions.

(a)

As used in this act:

(xxii)

"Small employer" means any person, firm, corporation, partnership or association who is actively engaged in business who, on at least fifty percent (50%) of its working days during the preceding calendar quarter, employed at least two (2) but no more than
fifty (50)

one hundred (100)
eligible employees, the majority of whom were employed within this state or were residents of Wyoming. In
determining the number of eligible employees, companies which are affiliated companies, or which are eligible to file a combined tax return for purposes of any state taxation, shall be considered one (1) employer;

26
‑
19
‑
304.

Restrictions relating to premium rates.

(f)

Commencing January 1, 2015, employees of small employers who are charged a premium for their coverage and who earn less than fourteen dollars and fifty cents ($14.50) per hour shall receive a subsidy of five dollars ($5.00) per month, not to exceed their premium, to compensate in part for the cost increase caused by Obamacare. The subsidy provided by this subsection shall be paid by the small employer to the employer's carrier, and the employer shall quarterly submit an application for reimbursement to the Wyoming business council. The council shall adopt regulations and an application procedure to administer the reimbursement program under this subsection.

26
‑
19
‑
311.

Small employer carrier reinsurance account created.

There is created an account in which all money received or collected to support the small employer carrier reinsurance program created pursuant to this act shall be credited and continuously appropriated for the purposes of this act

and W.S. 26
‑
18
‑
401 through 26
‑
18
‑
413
. All claims, insurer reimbursements, cost of administration and other necessary expenses incurred pursuant to this act shall be paid from the account. All money in the account not immediately necessary for the purposes of this act, which amount is certified by the board to the state treasurer, shall be invested and any interest earned shall be credited to the account.

In allocating funds within the account, the needs of the small employer carrier reinsurance account shall take priority over the needs of the programs under W.S. 26
‑
18
‑
401 through 26
‑
18
‑
413.

26
‑
19
‑
312.

Small employer carrier reinsurance program assessments; premium tax credit.

(a)

After each calendar year, the board shall determine the amount of assessment needed to support the small carrier reinsurance program
and the programs authorized by W.S. 26
‑
18
‑
401 through 26
‑
18
‑
413

considering
all payments made, costs incurred, premiums received and other income received.

26
‑
43
‑
103.

Eligibility.

(b)

The following persons are not eligible for pool coverage:

(i)

Persons who have coverage under health insurance or an insurance arrangement on the issue date of pool coverage

unless the cost of coverage has increased since March 1, 2010
,
to exceed the applicable cost of coverage applied for under the pool or the deductible has risen to exceed the deductible for the coverage applied for under the pool
;

26
‑
43
‑
113.

Termination of provisions.

This act is not effective after June 30,
2015

2018
.

26
‑
43
‑
207.

Sunset.

W.S. 26
‑
43
‑
201 through 26
‑
43
‑
206 are repealed effective December 31,
2015

2018.

and all participants shall be
disenrolled effective July 1, 2015. The board shall use the period from April 1, 2015 to December 31, 2015 to fully discharge the affairs of the demonstration project.

Section 3.

2011 Wyoming Session
L
aws, Chapter 134, Section 3
(a)
is amended to read:

Section 3.

(a)

There is appropriated
one
million
five hundred thousand
dollars ($
1
,
5
00,000.00) from the general fund to the insurance department. This appropriation shall be for the period beginning with the effective date of this act and ending December 31,
2015

2018
.
This appropriation shall only be expended for the purposes of establishing a reserve account to pay claims in excess of amounts available in the appropriation in subsection (b) of this section if such claims are approved by the board and the governor approves use of funds in the reserve account.
In addition, with the approval of the board, the funds in the reserve account may be expended to pay claims in excess of the appropriation to support the Wyoming temporary medical welfare program authorized by W.S. 26
‑
18
‑
409.

Notwithstanding any other provision of law, this
appropriation shall not be transferred or expended for any other purpose and any unexpended, unobligated funds remaining from this appropriation shall revert as provided by law on January 1,
2016

2018
. This appropriation shall not be included in the department's 2013-2014 or 2015-2016 standard biennial budget request.

Section 4.

(a)

There is appropriated
fifty thousand
dollars ($
50,000
.00) from the
general
fund to the
insurance
department. This appropriation shall be for the period beginning with the effective date of this act and ending
December
3
1
, 201
8
.

This appropriation shall only
be expended for the purpose of
the department
contracting with the Wyoming health insurance pool to support the initial organization and management of the programs authorized by this act.
Notwithstanding any other provision of law, this appropriation shall not be transferred or expended for any other purpose and any unexpended, unobligated funds remaining from this appropriation shall revert as provided by law on
December 31, 2018
.

This appropriation
shall not
be included in the
insurance
department's

standard biennial budget request
s
.

(b)

There is appropriated
two million
dollars ($
2,000,000
.00) from the
general
fund to the
insurance
department. This appropriation shall be for the period beginning with the effective date of this act and ending
December
3
1
, 201
8
.

This appropriation shall only
be expended for the purpose of the department contracting with the Wyoming health insurance pool for claims and ongoing management of the Wyoming temporary medical welfare program authorized by W.S. 26
‑
18
‑
409.
Notwithstanding any other provision of law, this appropriation shall not be transferred or expended for any other purpose and any unexpended, unobligated funds remaining from this appropriation shall revert as provided by law on
December 31, 2018.
This appropriation
shall not
be included in the
insurance
department's

standard biennial budget request
s
.

Section
5
.

This act is effective immediately upon completion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constitution.

(END)

1
SF0108