Regional Health Care Coalition Act

Regional Health Care Coalition Act


This Act authorizes the insurance commissioner to establish a coalition of like-minded states with reciprocity agreements for the approval, offer, sale, and rating of comprehensive major medical health insurance plans.  The coalition would also adopt an alternative approval process for such plans.

Model Legislation

Section 1. Title. This Act shall be known as the “Regional Health Care Coalition Act.”

Section 2. Statement of Purpose.

(A)  The {insert legislature} seeks to initiate cooperation of like-minded states to create a multistate coalition with reciprocity agreements for the approval, offer, sale, rating, medical underwriting, renewal, and issuance of comprehensive major medical individual and group health insurance policies.

(B)  The {insert legislature} recognizes that insured health policies must be filed in each state for approval and compliance with each separate state’s administrative and coverage requirements.  The {insert legislature} believes that a coalition of states with consistent health insurance laws will lower development and distribution costs, making the coalition states a larger attractive market for more rapid introduction of new products and services.  In addition, a multistate market with common standards will encourage new insurers to locate and initiate business in the coalition states’ market.  The increased market size and common state requirements will increase competition among insurers and lower premiums.

Section 3. Definitions.  For the purposes of this Act, the following definition applies:

(A)  “Comprehensive major medical” means a plan with at least a $1 million coverage lifetime maximum; a cost sharing out-of-pocket maximum no greater than that applicable in any given year to a high deductible health plan as defined under Section 223 of the Internal Revenue Code with applicable annual indexing.

Section 4. Duties of the Insurance Commissioner.

(A)  It shall be the duty of the Insurance Commissioner to identify at least four states with insurance laws sufficiently consistent with the laws of this state in order to create an efficient regional or multistate market.

(B)  The Insurance Commissioner shall be authorized to take a lead role in establishing a coalition of other states to adopt an alternative policy approval process for comprehensive major medical policies that utilize a common set of policy approval requirements among the coalition states.

(C)  The Insurance Commissioner shall approve for sale in {insert state} comprehensive major medical individual and group policies that have been approved for issuance under the alternative policy approval process in the coalition states where the insurer is authorized to engage in the business of insurance, so long as the insurer is also authorized to engage in the business of insurance in {insert state} and provided that any such policy meets the requirements established by the Insurance Commissioner.

(D)  The Insurance Commissioner shall adopt rules and regulations necessary to implement this Act.

Section 5. Dispute Resolution.  Any dispute resolution mechanism or provision for notice and hearing currently provided under {insert state} law shall apply to insurers issuing and delivering plans pursuant to this Act.

Section 6. {Severability Clause}

Section 7. {Repealer Clause}

Section 8. {Effective Date}


Approved by ALEC Board of Directors on July 1, 2012.

Keyword Tags: Private Health Insurance Reform