The 2nd meeting of the Subcommittee on Insurance of the Special Advisory Commission of Senior Citizens was held on Thursday, November 5, 2009, at 2:30 PM, at the Capital Plaza Hotel. Barbara Germain, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Barbara Germain, Chair; Mary Barlow, Velma Childers, Marsha Dufeck, Ed Flanagan, Jane Fugate, Don Helton, Denver Moore, Joy Payne, Clarence Richardson, Ray Roundtree, Clayton Shannon, and Jim Terrell.
Guests: Representative Jeff Greer, D.J. Wasson, Bill Nold, Jay Thompson, and Stephanie McGauhey, Kentucky Department of Insurance.
LRC Staff: Rhonda Franklin, Emily Bottoms, and Jamie Griffin.
The minutes of the May 7, 2009 meeting were approved.
Representative Jeff Greer, Chairman of the House Committee on Banking and Insurance, attended the subcommittee meeting. He spoke with the members and responded to questions regarding various insurance concerns. He expressed his interest in seniors’ issues and invited members of the subcommittee to contact him.
Bill Nold, Director of the Health Division of the Department of Insurance, addressed the issue of health insurer coverage of genetic disorders. He stated that the Department has no role in determining coverage of genetic disorders or denial of insurance coverage for genetic disorders. The 2008 federal legislation, known as the “Genetic Information Nondiscrimination Act,” will benefit people who have a genetic condition by prohibiting health insurers from requiring genetic testing and by prohibiting reliance on genetic information of an individual.
D.J. Wasson, Department of Insurance, presented on the Local Government Premium tax. She stated that local governments, both cities and counties, have had the authority to impose, by ordinance, a tax on insurance companies' premium receipts for decades. Some local governments impose a flat rate tax, but most local governments impose a tax based on a percentage of the premium. Currently, 389 local governments in Kentucky impose a local government premium tax. In 2008 the General Assembly passed legislation that required the insurers in the state to itemize the premium tax on each premium statement mailed to policyholders to make them aware of the tax being charged, and to give them the ability to contest the tax if they believe they do not have taxable property or other taxable policies in the taxing jurisdiction. Ms. Wasson stated that there is no maximum on the premium tax. The highest tax is 15% in the city of Ravenna. Members suggested that a statutory cap be placed on the maximum allowable local government premium tax.
Finally, Bill Nold and D.J. Wasson discussed the issue of federal health care reform. Mr. Nold discussed the various House and Senate versions now before Congress. Both Mr. Nold and Ms. Wasson stated that they could not predict the outcome of health care reform, and stated that any changes made by Congress would require time for states to implement the changes. Members discussed the pros and cons of universal coverage. Mr. Nold pointed out that a successful health care reform package would require a number of different pieces, including reform of health care delivery, improved “telehealth” information sharing, and more coverage of the 47 million uninsured Americans.
On Friday, November 6, 2009, the subcommittee adopted the following recommendations:
1) Urge the General Assembly to provide continuation funding at the current level for Area Agencies on Aging to support Senior Programs due to the current economic climate, but urge the General Assembly to increase much needed funding to at least 5% when the economy improves.
2) To require long-term care insurance carriers to submit rate increases to the Attorney General, as well as the Office of Insurance, to allow intervention by the Attorney General as needed.
3) Urge the General Assembly to continue to address the state employee and other state supported retirement system funding including insurance benefits.
4) Urge the General Assembly to address necessary assistance for seniors when enrolling in Medicare Part D, appropriating federal funds including stimulus money for technology to the Senior Centers for access to Medicare.gov and staffing to assist seniors in selecting a prescription plan.