Monday, August 21, 2006


Update on Following the Health Insurance Money

Following up to my earlier article Following the Health Insurance Money, I had asked the Campaign Spending Commission whether Bob Herkes' submission is ok or if they planned to ask for a legible copy.

This morning they called back, and indeed they will follow up. It seems that some candidates hadn't even filed yet, so they have some work to do to get all the information in shape.

In the meantime, the Star Bulletin has written an editorial "Customers, businesses need oversight on insurance rates" on the need for health premium regulation, and there has been a letter to the editor "Insurance bill flawed on purpose". Neither of these noted that the original bill was simple, just calling for removal of the sunset provision of the existing law.

Where things went wrong was when that simple bill arrived at the Consumer Protection and Commerce Committee, Robert Herkes, Chair. It didn't stand a chance. The bill was amended by CSC. Pacific Business News reported that the amendment was written by industry.
The bill died because House and Senate lawmakers couldn't agree on amendments drafted by Kaiser Permanente Hawaii that would have made it harder for the state to deny insurers' rate proposals, according to the state insurance commissioner.
-- PBN, May 3, 2006

The amended bill was intentionally complex and if passed into law could have tied the Insurance Commission up in litigation.

Remember that the Commissioner testified that the law probably saved $18 million in premiums. It should have simply been allowed to continue by removing the sunset date, as both the original House and Senate bills provided. Oh.. let me not forget to mention that the House refused to hear its own version of the bill, making its intention to kill health insurance rate regulation known early on.

We lost this valuable protection not because of a "defective date" inserted into the bill, but because it was altered drastically in favor of the industry. The sad story is in the public record.

It could have been saved even at the conference committee level but the House did not want it saved. Check out in the record who was appointed by Speaker Say to the conference committee. When Senator Menor tried to save the bill by recommitting it to committee, the House refused.

House leadership shares responsibility for the demise of health premium regulation. All they had to do was pass a bill to continue a money-saving law.


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