LEG REG REVIEW 2015, 23d Issue – July 13, 2015

LEG REG REVIEW is a periodic newsletter produced by PHILLIPS ASSOCIATES, a professional lobbying and consultant firm located near the State Capitol.  It contains news on the legislative and regulatory scene in Pennsylvania that may be of interest to the Insurance and Business Communities.  It is a free member benefit for those who are members of the Pennsylvania Association of Health Underwriters (PAHU).  Subscription information may be obtained by contacting PHILLIPS ASSOCIATES at 717/728-1217 FAX 717/232-7005 or e-mail to xenobun@aol.com.  Please email jtrout2792@aol.com supplying both your name and e-mail address if you wish to be removed from or added to this list.

 

SIGNED BY THE GOVERNOR

  • House Bill 972 (Pickett-R-Bradford) amends Act 154 specifying the commencement of the period during which the owner of an individual life policy or annuity may examine or return the policy for cancellation.  It shall be the date of mailing, the date the policy or annuity is physically delivered, or the date of electronic transmission of the policy or annuity.  The insurer shall have the burden of proof as to documenting the delivery date.  HB 972 was signed into law as Act 30 of 2015 by Governor Wolf on July 10.
  • Despite being at budgetary loggerheads with the General Assembly, Governor Wolf did sign nine specified budget bills, one of which directly affects P/C insurance.  Senate Bill 813 (Hughes-D-Phila.) or Act 9A of 2015 makes appropriations from the Workers’ Compensation Administration Fund ($71.966 million) to fund continued administration of the Workers’ Compensation Act by the Department of Labor & Industry.  Three million dollars went to the Uninsured Employers Guaranty Fund. SB 813 also allocates $194,000 to fund the Office of Small Business Advocate housed within the Department of Community & Economic Development.
  • Also signed into law July 10 was House Bill 140 (Killion-R-Delaware) or Act 22 of 2015.  It says that  ridesharing arrangements (vanpools) are exempt from regulatory oversight by the PA Public Utility Commission (PUC).  However, there are conditions that:
  • The group must not exceed 15 persons
  • The group does not consist of school-age children
  • The vehicle weighs 10,000 pounds or less
  • The group is transported round trip where the driver is also driving to and from his or her home and place of work or educational or other institution.

 

VETOED BY THE GOVERNOR

In addition to vetoing House Bill 1192, the Republican State Budget, Governor Wolf also vetoed a companion budget bill, Senate Bill 655 (Browne-R-Lehigh) which included a provision to re-authorize the State Workers’ Insurance Fund (SWIF).  Technically, SWIF’s authority expired June 30, 2015.

 

BEING CONSIDERED THIS WEEK

Given the impasse over the State Budget, the Senate is meeting this week while the House will come back into session the week of July 19.  On the docket for this week:

  • On July 14, the Senate Rules & Executive Nominations committee will consider Senate Bill 487 (McIlhinney-R-Bucks).  This legislation limits co-payments for insured medical services provided by physical therapists, chiropractors and occupational therapists.
  • The Senate calendar has two insurance bills on third consideration.  They are House Bill 857 (Pickett-R-Bradford) which reauthorizes the Children’s Health Insurance Program (CHIP) and House Bill 60 (Baker-R-Tioga) providing for insurer consistent payment for oral chemotherapy and intravenous chemotherapy.

 

 

 

 

PCRB SWITCHING TO ALL ELECTRONIC BY 2017

PA Compensation Rating Bureau (PCRB) announced per Circular Number 1645 that it will eliminate hardcopy reporting over the next 19 months.  Effective January 1, 2016, hardcopy handling charges will double to $100 for policies and increase from $10 to $50 for cancellations and reinstatements.  On July 1, 2016, those charges will increase to $150 and $100 respectively.  PCRB will no longer accept and process hardcopy policy documents on or after January 1, 2017.  The name of the new web-based system is Policy Data Manager (PDM).  PCRB plans two webinars on July 14 and 15 for carriers to walk through some of the basic PDM applications.  Although the registration close-off date was July 7, inquiries can still be directed to centralsupport@pcrb.com.

A link to Circular Number 1645 follows:  https://www.dcrb.com/shared/p_contents.htm

 

END OF YEAR BUDGET NUMBERS SHOW REVENUE GAIN

Figures released by the PA Department of Revenue show $412.2 million more in revenues than anticipated for the past fiscal year despite receiving 6.6 percent less than estimated in June, the end of the 2014-15 Fiscal Year.  Revenue breakdown is as follows:

 

Revenue Source                     Actual FY 2014-15    Above/Below Estimate          Percent Difference

Sales Tax                                 $9.5 billion                  + 16.1 million                          +0.2%

Personal Income Tax               $12.1 billion                + $74.6 million                        +0.6%

Corporate Tax                         $5.1 billion                  + $240 million                         +4.9%

Inheritance Tax                       $1.0 billion                  + $67.8 million                        +7.3%

Realty Transfer Tax                $413.8 million             – $33.7 million                         – 7.5%

Other General Fund                $1.4 billion                  + $19.2 million                        +1.4%

(Includes cigarette, malt beverage, liquor, table games taxes)

Non-Tax Revenue                   $1.1 billion                  + $28.3 million                        +2.6%

(Includes casino licenses and Oil and Gas Lease Fund, etc.)

 

Totals                                      $30.6 billion                +412.2 million                         +1.4%

 

DEPARTMENT RECOMMENDS ESSENTIAL BENEFITS TO HHS

The PA Insurance Department completed its review of health plan benefits in June and has recommended that HHS set the benchmark for essential health benefits in Pennsylvania consistent with Independence Blue Cross Keystone Health Plan East.  Per the Patient Protection Affordable Care Act (PPACA), each individual and small group plan must cover certain services using one of the following options: one of the three largest group plans; one of the three largest state employee health plans; one of the three largest federal employee health plan options; or the state’s largest HMO plan offered in the commercial market.  Current essential health benefit levels are based on an Aetna POS plan.  The new benefit benchmarks will take effect in 2017.  NOTE:  This is not a Department endorsement of a specific plan over other plans but is rather the selection of benefits offered by that plan as the new template for all individual and small group plans.

 

MEETING NOTES

  • The PA Association of Mutual Insurance Companies (PAMIC)’s 108th Mid-Atlantic Mutual Advantage Convention will take place August 2-4, 2015.  The event will take place at Nemacolin Woodland Resort in Farmington, PA and will feature keynote speaker Jerry Theodorou, Vice President of Insurance Research, Conning, Inc.  Details: Jessica Witmer at jwitmer@pamic.org or 717/303-0197
  • The Insurance Club of Pittsburgh announced the date for the 2016 I-Day.  It is Wednesday March 30, 2016.  Details: Tiffany Gillies 412/489-5626 or icp@insclubpgh.com

 

CONDOLENCES to the family of former PA Senator Leonard Bodack, Sr. (D-Allegheny) who passed away July 7 at the age of 82.  His public service in the General Assembly spanned 1979-2002.

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