H. B. 2109

(By Delegate Walters)
[Introduced January 14, 1998
; referred to the
Committee on Banking and Insurance then Government Organization.]

A BILL to amend article four, chapter thirty-three of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new section, designated section twenty, relating to insurance; general provisions; creating a reinsurance pool for persons who are unable to qualify for health insurance because of illnesses or physical conditions; insurance commissioner to manage and promulgate rules; how pool funded; insurers prohibited from tightening underwriting standards; and processing claims.

Be it enacted by the Legislature of West Virginia:
That article four, chapter thirty-three of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new section, designated section twenty, to read as follows:

§33-4-20. Reinsurance pool for health insurance created;

commissioner to manage and promulgate rules; who eligible; responsibility of insurers; etc.

(a) There is hereby created a reinsurance pool, managed by the insurance commissioner and funded by the insurers, authorized to issue policies of insurance under the provisions of articles fifteen, fifteen-a, sixteen, sixteen-a and sixteen-c of this chapter, in order to provide coverage for individuals who have existing conditions which prevent them from qualifying for an insurance policy or coverage from a private insurance company. Any reinsurance pool, plan or agreement shall be governed by the provisions of sections fifteen, fifteen-a and fifteen-b of this article.
(b) The commissioner shall propose rules for legislative approval in accordance with the provisions of article three, chapter twenty-nine-a of this code for the implementation and administration of the provisions of this section, but which shall provide that these individuals will pay a premium to the state equal to the highest rate, plus twenty-five percent, charged by any insurance company in the state for insurance of that type.
(c) Employers who have employees in their group plans with illnesses or physical conditions that prohibit the group from obtaining lower cost insurance bids from other insurers may move that individual risk to the state pool. The individual employee is required to have a specific amount in claims, to be determined by the commissioner, paid by the new insurance carrier before the existing insurance carrier can move that individual to the state risk pool. Only the employees identified at current enrollment as high risk are eligible for the reinsurance pool. The contribution shall be reviewed quarterly to ensure fairness.
(d) The current insurer of the group shall continue to process claims for the individual moved to the reinsurance pool and pay the claims but shall send the explanation of benefits to the reinsurance pool for payment back to the insurance company. All insurance companies issuing health insurance policies in West Virginia shall, on a monthly basis, pay for all cost overruns in the reinsurance pool on a basis equal to their market share. Self-insured persons and third-party administrators shall make a monthly contribution of three dollars per person per month to help fund the reinsurance pool.
(e) No insurance company may change its underwriting standards just for West Virginia unless it changes them nationally. If a company tightens its standards, it shall go to the risk pool in greater numbers.
(f) Insurance carriers shall reevaluate the insurability of the individual employees who were assigned to the reinsurance pool on an annual basis, in order to return them to the group insurance plan.
(g) Any insurer subject to this section is also subject to the provisions of article thirty-eight of this chapter.

NOTE: The purpose of this bill is to create a reinsurance pool, supervised by the Insurance Commissioner, to provide health insurance for persons who are not eligible therefor because of illnesses or physical conditions, or who cannot otherwise qualify for insurance because of these conditions.
