Assembly approves Health Care Reform Act of 2004
STATE HOUSE – The Health Care Reform Act of 2004, the five-bill legislative package developed to address concerns with Blue Cross & Blue Shield of Rhode Island and the state’s entire health insurance industry, has been approved by the General Assembly.
Sponsored by legislative leaders in both chambers, the act grew out of the work of the Permanent Joint Legislative Committee on Health Care Oversight, which held hearings this legislative session to gather information about the state of the health insurance industry in Rhode Island, and how to make health insurance more accessible and affordable for Rhode Islanders.
"This legislative package is the result of careful study and hours of testimony from people involved in every aspect of the health insurance industry, from Blue Cross executives to people who go without regular health care because they can’t afford health insurance," said Sen. Elizabeth H. Roberts (D-Dist. 28) of Cranston and Warwick, co-chairperson of the joint committee. "We were vigilant about listening to as many viewpoints as possible and working with experts to develop changes that will keep Blue Cross and other insurers on track to provide Rhode Islanders with quality health care that they can afford."
Said Rep. Steven M. Costantino (D-Dist. 8) of Providence, also co-chairperson of the joint committee, "The Health Care Reform Act is a well thought-out, comprehensive approach to changing the policies that shape the health insurance industry and setting up a system of oversight to ensure that insurers act in the best interest of consumers. More than just fixing the problems we know about today, this legislation is aimed at setting up systems to continually monitor the insurance industry and respond to its changing issues."
President of the Senate Joseph A. Montalbano said he is confident that the legislation will result in better health care accessibility for Rhode Islanders.
"By refocusing Blue Cross on its charitable mission and putting better oversight in place, this legislation will result in more resources being directed toward providing affordable health care," said President of the Senate Montalbano (D-Dist. 17) of North Providence, Pawtucket and Lincoln.
House Speaker William J. Murphy applauded the legislators and staff who worked on the Health Care Reform Act for their hard work and dedication.
"The members of the Joint Committee on Health Care Oversight spent months patiently holding lengthy hearings, digesting an incredible amount of information and weighing the facts to develop thoughtful, comprehensive legislation,” said Speaker Murphy (D-Dist. 26) of West Warwick, Coventry and Warwick.
"The remarkable thing about this package of reforms is the level of agreement and cooperation between the House and the Senate. This was really a partnership on behalf of the citizens of Rhode Island," said Senate Majority Leader M. Teresa Paiva-Weed (D-Dist. 13) of Newport and Jamestown.
"Not only did the joint committee hear hours of testimony and receive numerous recommendations, they prepared a set of bills that are comprehensive, thoughtful and very well-targeted to the problems at hand," said House Majority Leader Gordon D. Fox (D-Dist. 4) of Providence.
The bills are:
(2004-S 3103 Sub. A as amended) and (2004- H 8516 Sub. A as amended) – This bill, sponsored in the Senate by Sen. John J. Tassoni Jr. (D-Dist. 22) of Smithfield and North Smithfield and in the House by Rep. Brian Patrick Kennedy (D-Dist. 38) of Hopkinton and Westerly, is aimed at providing more flexibility for businesses with health insurance plans. It:
- Entitles employers with 100 or more persons covered by their health plan to receive reports of their health plan’s claims information.
- Removes an Oct. 1, 2004, sunset provision from a law allowing small employers to vary adjusted community rates based on health status, making the provision permanent.
- Between Oct. 1, 2004 and Oct. 1, 2006, makes employers with 10 or fewer employees eligible for small employer health insurance if at least 75 percent of employees participate, instead of the current requirement of 100-percent participation.
(2004-S 3102 Sub. A as amended) and (2004- H 8515 Sub. A as amended) – This legislation reforms the governance of Blue Cross and Blue Shield of Rhode Island, which was created by the General Assembly as a non-profit insurance provider. Sponsored in the Senate by Joint Committee on Health Care Oversight Co-Chairperson Sen. Elizabeth H. Roberts (D-Dist. 28) of Cranston and Warwick and in the House by Rep. Paul W. Crowley (D-Dist. 75) of Newport, the bill increases the accountability of the Blue Cross board of directors and refocuses the insurer’s mission statement. It:
- Requires the board of directors to act in good faith, ensure that Blue Cross carries out its charitable mission, perform an annual evaluation of board performance and hold an annual meeting for public comment;
- Prohibits compensation of board members until the appointment of the health insurance commissioner, who will review and approve any compensation;
- Prohibits loans to directors or officers;
- Requires the adoption of a code of ethics;
- Requires that six board members be appointed by state government (two each by the governor, the Speaker of the House and the President of the Senate);
- Requires a two-thirds majority vote of the board for any decision for a merger sale, or for withdrawing from a geographic area;
- Requires Blue Cross to: have an open enrollment period annually for at least 30 days for individuals, continue to provide insurance to small groups, make an effort to remain affordable and to protect its own financial condition;
- Prohibits incentives for executives if the corporation is sold.
(2004-S 3101 Sub. A as amended) and (2004- H 8513 Sub. A as amended) – Sponsored by Sen. Stephen D. Alves (D-Dist. 32) of West Warwick and Rep. Joanne M. Giannini (D-Dist. 7) of Providence, this legislation establishes a health insurance commissioner within the Department of Business Regulation, appointed by the governor with Senate confirmation. The commissioner would conduct annual public meetings, make recommendations to the governor and legislators regarding the affordability of health insurance, propose draft legislation, make recommendations on insurers’ reserves and administration fees, and co-chair a consumer/business/medical advisory group. The budget passed by the General Assembly this week allocates $275,000 for the commissioner’s office.
(2004 - S3100 as amended) and (2004- H 8514 as amended) – This resolution requires the Department of Business Regulation to conduct a study of insurance reforms, including those recently enacted in New Hampshire, high-risk pools, purchasing alliances for small businesses, and regional insurance regulation. It is sponsored in the Senate by Sen. Rhoda E. Perry (D-Dist. 1) of Providence and in the House by Rep. Arthur J. Corvese (D-Dist. 55) of North Providence.
(2004 - S3099) and (2004- H 8517) – This legislation, sponsored by Senator Perry and Joint Committee on Health Care Oversight Co-Chairperson Steven M. Costantino (D-Dist. 8) of Providence, requires the Permanent Joint Committee on Health Care Oversight to continue its review of and make recommendations for further reform of the state’s regulatory structure for health insurance.
Four of the five bills are being transmitted to the governor. The fifth (2004 - S3100 as amended and 2004- H 8514 as amended ), as a resolution, is now effective.
For more information, contact:
Greg Pare, Press Secretary for the Senate
State House Room 314
Providence, RI 02903
(401) 222-4018
[This interference in the marketplace does not make it mandatory for everyone who can, to pay into the health insurance system. So what about the healthy people who contribute nothing to the health care financing system, but who expect to get the best in medical care when they unexpectedly need it, even if they can't afford it?
There are many factors contributing to the high cost of modern medical care, but when are legislators going to address the issue of ensuring that everyone with income or assets contributes to the financing of health care?
The stated aim to " ...to provide Rhode Islanders with quality health care that they can afford" is getting closer to the issue. Legislators needs to look at ways to reduce the cost of health care itself and at the same time mandate that everyone, with means to do so, contribute to the health care financing system. – ed.]