Health care reform dominated the agenda of the 2009 Legislature. An assessment
on health insurance premiums and a hospital tax will provide health care coverage
for 80,000 children and 35,000 low-income adults. Additionally, policymakers
approved a blueprint to pursue future health care reforms. The Department
of Consumer and Business Services (DCBS) will consult with the new Oregon
Health Authority to develop these proposals.
Meanwhile, the Insurance Division, which protects the insurance-buying public
through its regulation of the insurance industry, gained new protections for
consumers whose cars are totaled and improvements to its health insurance
rate review process.
This division summary covers key insurance-related bills with links to the
bills. These bills passed the Legislature although not all have been signed
by the governor. Unless a bill says otherwise, it is effective Jan. 1, 2010.
HB 2009 makes a variety of reforms to Oregon's health care system to
contain costs and improve quality. The bill includes a focus on preventive
care and evidence-based medicine, development of a "health insurance
exchange" to allow comparison shopping for insurance plans, stronger
standards for review of insurance rates, and streamlining administrative
functions by consolidating the state's health care functions into one
agency.
With respect to the stronger standards for review of insurance rates, HB 2009 adds a public
comment period, requires more detail about insurer administrative expenses, allows consideration
of an insurance company's cost containment and quality improvement efforts, and gives DCBS
greater ability to consider an insurer's overall profitability, investment earnings, and
surplus in determining whether a rate should be approved. Although the bill was effective
on passage, the rate review sections apply to rate filings submitted on or after April 1,
2010.
A new, 1 percent assessment on health insurance premiums and a hospital
tax will generate revenues to help provide health care coverage for 80,000
children and 35,000 low-income adults. Insurance companies may increase
health insurance premiums by 1 percent, effective Oct. 1, 2009.
This bill allows the OMIP board to take action with a majority of voting
members versus a majority of the whole, nine-member board. It removes
the 180-day Oregon residency requirement for OMIP portability applicants
to conform to federal law. It adopts the Oregon Insurance Division definition
of "medical insurance" to assure consistency, and it specifies
which types of insurance are not subject to the OMIP assessment. And,
it clarifies which public entities and health care providers can pay an
OMIP member's premium.
This law ensures that Oregonians who were laid off during the economic
downturn can take full advantage of health care premium assistance available
through the federal economic stimulus package. The bill expands the state
continuation plan from six months to nine months, gives Oregonians who
lost their job before the stimulus package was announced a second opportunity
to elect to continue coverage, and establishes notification requirements
for insurers. This law became effective on April 28, 2009.
Insurance companies obtain "reinsurance" to protect themselves
from greater risk and higher losses and as a means to keep premiums lower.
HB 2755 requires DCBS, in collaboration with the Office of Health Policy
and Research, to conduct a study on reinsurance and other risk-spreading
mechanisms for individual and small employer group health insurance markets.
The bill also requires DCBS to provide a report on the results of the
study and recommendations to the Legislative Assembly by December 1, 2010.
Currently, health insurers are not required to approve or deny a provider's
application to become a "credentialed provider" within a designated
period of time or reimburse the provider for services provided during
the credentialing period. This bill requires health insurers to approve
or deny a provider's application to become a credentialed provider within
90 days of receipt. Health insurers must pay providers for claims during
the 90-day "credentialing period" at least at the non-participating
provider rates, with certain exceptions. This bill applies to requests
to enter into medical service contracts submitted by a provider on or
after the effective date. The bill declares an emergency and became effective
upon passage.
Requires health insurers to request a refund from health care providers
within 24 months of the date of payment, with certain exceptions, and
to allow six months for payment of a refund. The bill also requires providers
to request an additional payment for a claim from insurers within 24 months
after the date the claim was denied, with certain exceptions, and to allow
insurers six months to make the additional payment.
Improves access to health care for those without insurance by establishing
a limited number of community-based health care programs that are exempt
from the Insurance Code. The bill declares an emergency and became effective
June 23, 2009.
Mandates (Apply to policies or plans issued or renewed on or
after January 1, 2010.)
HB 2506: Requires health plans to cover services
of professional counselors and marriage and family therapists if certain
other services are covered by the plan.
HB 2794: Requires coverage of the human papillomavirus
(HPV) vaccine for females between ages 11 and 26. HPV is the main cause
of cervical cancer in women.
HB 2190: Protections for owners of totaled vehicles
This bill protects consumers whose motor vehicles are declared "totaled."
Insurers typically offer a cash settlement when a vehicle is totaled,
but consumers often do not understand how their insurer valued the vehicle.
The bill requires insurers to provide vehicle owners with a written explanation
of how the vehicle value was determined and other information about the
total loss process, allows owners of totaled motor vehicles, after certain
conditions are met, to obtain the undisputed amount of the vehicle's value
while negotiations continue to settle the claim, and requires insurers
who include an appraisal provision in the policy to reimburse their insureds'
reasonable appraisal costs when the final appraisal results in a greater
valuation than the insurer's final offer. This bill applies to motor vehicle
liability insurance policies issued or renewed on or after the effective
date.
HB 2233: Insurance for commercial driver training school
This bill increases the motor vehicle liability insurance coverage required
for the applicant or holder of a commercial driver training school certificate.
The following coverage is currently required: $50,000 for bodily injury
to or death of one person in one accident, $100,000 for bodily injury
to or death of two or more persons in one accident, and $25,000 for injury
to or destruction of property of others in any one accident. This bill
increases the minimum coverage to $100,000/$300,000/$50,000. The applicant
or holder of a commercial driver training school certificate does not
need to submit proof of insurance for issuance or renewal of the certificate
if the applicant or holder of the certificate conducts only classroom
instruction.
This bill increases the maximum monthly income replacement benefits
available if an injury prevents a person from returning to work from $1,250
to $3,000. The bill also increases the amount of motor vehicle liability
insurance coverage required for property damage to others from $10,000
to $20,000. NOTE: Under the Insurance Code, the passage of HB 2326 also
increases the minimum amount of optional uninsured motorist coverage for
property damage that must be offered on private passenger motor vehicles
not more than 12 years old from $10,000 to $20,000. This bill applies
to motor vehicle insurance policies issued or renewed on or after the
effective date.
This bill continues the rights of the motor vehicle liability insurer
who provides personal injury protection benefits to recover those payments
from the responsible person's insurer if there is a settlement within
60 days after the accident. The bill requires insurers to state these
rights in the release signed by the injured person and provide other disclosures
to the injured person. The bill also allows the injured person to rescind
the release within five days of signing the release. The bill applies
to motor vehicle accidents that occur on or after the effective date and
applies to releases obtained on or after the effective date.
In accordance with Oregon law, the Oregon Department of Transportation,
in a cooperative venture with TEAM OREGON and Oregon State University,
established a motorcycle rider education program. HB 2370 requires insurers
offering liability, personal injury protection, or collision coverage
to offer a premium discount to the principal operator of a motorcycle
who has completed this motorcycle rider education program. Only one motorcycle
per principal operator is eligible for the discount and the motorcycle
must not be used for business. If an insurance policy covers motorcycles
and other vehicles, the premium discount is limited to the motorcycle
portions of the policy. This bill applies to motor vehicle insurance policies
issued or renewed on or after the effective date.
Oregon used commercial sureties for bail until the mid-1970s. Currently,
the bail process is administered through the courts. This bill requires
a legislative interim committee to take testimony on the feasibility and
advisability of reinstituting a commercial surety bail system in Oregon.
The committee may make recommendations to the next Legislative Assembly.
The bill declares an emergency and is effective July 1, 2009.
SB 377: Consumer rerating requests based on new credit information
If an insurer uses a consumer's credit history for rating purposes,
current law allows a consumer to request a rerating no more than once
a year for any given policy. However, the rerating may result in an increase
or decrease in the rate and may not be implemented by the insurer until
the policy is renewed. This bill prohibits insurers from increasing a
consumer's premium after rerating. It requires insurers to decrease the
premium for certain specified policies if credit was used for rating and
the consumer is entitled to a reduced premium. It also requires the insurer
to rerate the consumer within 30 days after receiving the request, effective
as of the date the consumer requested the rerating. This bill applies
to personal insurance policies issued or renewed on or after the effective
date.
HB 2198: Continuing education for some life agents
This bill eliminates the exemption from continuing education requirements for retired life
insurance agents servicing existing life insurance policies. There are currently approximately
50 retired life insurance agents who are exempt from the continuing education requirements.
These agents, as well as agents who become exempt prior to the effective date, will be grandfathered
in.
This bill allows certain individuals other than a spouse to buy insurance on a family member
to cover funeral expenses without the family member's written consent.
The Department of Veterans' Affairs is the lead agency responsible for providing programs,
services and benefits for Oregon veterans, including loan cancellation life insurance. When
the department provides a home loan to a veteran, the veteran is offered this insurance which
pays off the remaining loan debt should the veteran pass away. This bill codifies the current
practice of allowing the department to purchase loan cancellation life insurance and provide
it to qualifying veterans.
A life settlement agreement is a contract under which the owner of a life insurance policy
sells or transfers the policy to a third-party for an amount less than the death benefit.
Currently, Oregon regulates life settlement agreements only when the insured is chronically
or terminally ill. This bill clarifies the authority of DCBS to regulate life settlements
and the brokers and providers engaged in life settlement activities. The bill also protects
consumers, particularly seniors, who are approached to sell or transfer their policy to investors.
The bill requires additional disclosures, protects the privacy of a consumer's personal financial
and medical information, and bans certain types of life settlement transactions, including
those involved in a stranger-originated life insurance (STOLI) plan.
Adobe Reader is required to view PDF files. Click the "Get Adobe Reader" image to get a free download of the reader from Adobe. Available for Macintosh or Windows.
