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.
Dear Leg-Reg Review Reader:
Despite the three larger issues that dominate the media — State Budget, pension reform, privatization of the liquor stores– there are a good number of pieces of insurance legislation which have been introduced or are seeing legislative activity. Some examples:
- Auto Damage Photo Appraisal
- Auto Insurance requirements doubled
- Breast density screening mandated benefit
- CHIP reauthorization and transferring CHIP from the Insurance Department to the Dept. of Human Services, formerly known as DPW
- Flood Insurance reporting requirement
- Long-Term Care Council which includes an insurance producer in its makeup
- Property Tax Elimination
- Reauthorization of PHC4
- Selling insurance without a license (self-storage facilities)
- Single Payer System for PA
- SWIF re-authorization
If you have questions about any of these topics, please feel free to contact me. 717/346-1063, xenobun@aol.com. I hope you and your families have a restful and rejuvenating Thanksgiving. We have a lot to be thankful for. Sincerely, Vince
PROPERTY TAX ELIMINATION VOTE?
An effort to eliminate Pennsylvania’s property tax system is positioned for a vote by the PA Senate. Sponsored by Senator Dave Argall (R-Schuylkill), Senate Bill 76 would eliminate personal property taxes and would make up the money by increasing the rate of the sales tax and by expanding the reach of the sales tax into numbers of currently exempted business activities. Although strongly supported by those seeking to eliminate the tax, SB 76 has formidable opposition as well. A November 16 letter to Senators was signed by 50 groups including strange bedfellows such as the PA Chamber of Business & Industry and the trial lawyers (PA Association for Justice). One issue concerning retailers in counties bordering other states is the fear that limiting the sales tax exemption on clothing to $50 will curtail business they now get from other states that do have a clothing sales tax.
PAHU has not formally weighed in on the issue as there is a great variety of opinions within the business community. However, the proposed sales tax expansion does NOT include insurance agencies. PSMA worked with SB 76’s sponsor to exclude insurance agencies from having to charge any sales taxes for their fee services.
SENATE BANKING & INSURANCE COMMITTEE REVIEWS MANDATED BENEFIT
On November 18, the Senate Banking & Insurance Committee heard testimony on Senate Bill 842 (Mensch-R-Montgomery) which, if adopted, would require first-dollar insurance coverage for breast density screening. According to Senator Mensch, mammograms miss 40% of tumors in women with denser breasts. SB 842 is supported by the PA Breast Cancer Coalition.
LTC COUNCIL BILL SENT TO GOVERNOR
House Bill 753 (Schlegel-Culver-R-Northumberland/Snyder) received Senate approval and was sent to the Governor November 18 for his signature. HB 753 creates a permanent Long-Term Care Council whose members represent a wide span of interests with an interest in senior and long-term care quality and independent living issues. PA Association of Health Underwriters (PAHU) was successful in making sure that an insurance producer with experience selling long-term care insurance was included. PAHU’s view has been that LTC insurance is a way for families to handle their own financial responsibilities as their loved ones require long-term care services.
REGULATORY UPDATES
- The Public Utility Commission (PUC) received a recommendation that ride-sharing companies (Uber and Lyft) be fined $50 million for unauthorized activity after a 2014 PUC order to cease operations. Although PUC since granted a two-year experimental use permit, both companies continued operations after the PUC ordered them to stop. The PUC will rule on the recommendation.
- Church Mutual Insurance Company, a Wisconsin-domiciled casualty insurance company is seeking to control School Boards Insurance Company of PA, Inc.
- Professional Casualty Association (PCA) and Physicians’ Insurance Program Exchange (PIPE) filed an application to convert to stock companies.
- The PA Insurance Department released figures for October showing results of activities by enforcement and by consumer services.
Office Fines Restitution Number Persons
Enforcement $10,000 $52,953 7
Consumer Services NA $201,171 66
Total October 2015 $10,000 $254,124 73
Year-To-Date $1.2 million $151 million 10,974
HSAs CONTINUE GROWTH PATH
According to America’s Health Insurance Plans (AHIP), public participation in Health Savings Accounts climbed 13% since 2014. AHIP reported 19.7 million Americans covered by a HDHP/HSA, an increase of over two million since January 2014. Pennsylvania ranked third with 843,182 after Texas and Illinois. In a separate HSA item, the IRS announced that the maximum contribution that can be made in 2016 to a Health Savings Account linked to a high-deductible health plan will be $6,750 for employees with family coverage, up from $6,650. Maximum out-of-pocket employee expense for single coverage remains $3,350. Maximum out of pocket expenses including deductibles will increase $100 to $6,550 for single coverage and increase $200 next year to $13,100 for family coverage.
COMING UP…
- Senate Appropriations Committee will consider House Bill 857 (Pickett-R-Bradford) to reauthorize the Children’s Health Insurance Program (CHIP) until December 31, 2017. Unless renewed, CHIP’s legislative authority will expire at the end of this year.
- The House Health Committee will convene an informational meeting where the Department of Human Services (DHS) will discuss long-term managed care.
- The Legislative Budget & Finance Committee will present its report to the general Assembly on consolidation of school district benefit programs into a state-run system. This study was mandated by Senate Resolution 250 in 2014. PAHU had submitted input as to why this approach would be unhelpful to school districts.
- On the House voting calendar is House Bill 1638 (Tobash-R-Schuylkill). It says that an auto appraiser may prepare a report through personal inspection as is done now but will add photographs, video and smart phones as appraisal tools.