S.F. 2121 Section 1. NEW SECTION . 505.32 Individual and small 1 employer basic benefit health care coverage. 2 1. The commissioner of insurance, in cooperation with 3 carriers interested in participating, shall by rule develop 4 individual and small employer health insurance plans providing 5 basic benefit coverage targeted for sale to individuals under 6 thirty years of age, and their eligible dependents, who have 7 not had health care benefits within the preceding twelve 8 months. 9 2. The health insurance plans developed shall provide basic 10 levels of primary, preventive, and hospital care for covered 11 individuals, including inpatient hospitalization coverage, 12 prenatal care, obstetrical care, a basic level of primary and 13 preventive care, and such other coverages as the commissioner 14 may determine are cost effective. 15 3. A basic benefit coverage policy or subscription contract 16 shall include a disclosure statement which includes but is 17 not limited to an explanation of those mandated benefits and 18 providers not covered by the policy or contract, the managed 19 care and cost control features of the policy or contract, and 20 the period of time the policy or contract remains in effect. 21 4. All basic benefit coverage policy forms including 22 applications, enrollment forms, policies, subscription 23 contracts, certificates, evidences of coverage, riders, 24 amendments, endorsements, and disclosure forms shall be filed 25 with and approved by the commissioner before a basic benefit 26 coverage policy or subscription contract is issued or issued 27 for delivery in this state. 28 5. Basic benefit coverage policies or subscription 29 contracts shall return a cumulative loss ratio as determined by 30 the commissioner. 31 6. Each carrier providing a basic benefit coverage policy 32 or subscription contract in this state shall maintain separate 33 and distinct records of enrollment, claim costs, premium 34 income, utilization, and other information as required by 35 -1- LSB 5251SS (4) 83 av/nh 1/ 5

S.F. 2121 the commissioner. Each carrier providing such policies or 1 contracts shall furnish an annual report to the commissioner. 2 The report shall be in a form prescribed by the commissioner 3 and shall contain information required by the commissioner to 4 analyze the success of insurance coverage issued pursuant to 5 this section. 6 7. The commissioner may, upon reasonable actuarial evidence 7 as to cost effectiveness, make determinations regarding any of 8 the following: 9 a. What benefits or direct pay requirements must be 10 minimally included in a basic benefit coverage policy or 11 subscription contract. 12 b. What benefits or direct pay requirements otherwise 13 mandated by state law may be exempted from coverage by a basic 14 benefit coverage policy or subscription contract. 15 c. What cost-containment procedures must be minimally 16 included in a basic benefit coverage policy or subscription 17 contract. 18 d. What cost-containment measures otherwise restricted by 19 state law may be utilized by a basic benefit coverage policy or 20 subscription contract. 21 8. The commissioner may retain a consultant to assist in 22 the analysis of any benefit or requirement and may convene 23 an advisory panel to assist the commissioner in the review 24 of evidence and practices by the health care and insurance 25 industries. 26 a. The commissioner may assess a fee against carriers 27 issuing or issuing for delivery in this state basic benefit 28 coverage policies or subscription contracts to defray 29 consulting fees and expenses incurred by the commissioner under 30 this subsection. 31 b. The commissioner may also require medical professional 32 societies or providers’ associations requesting the inclusion 33 of a benefit or requirement in a basic benefit coverage policy 34 or subscription contract to contribute on a proportionate 35 -2- LSB 5251SS (4) 83 av/nh 2/ 5

S.F. 2121 and reasonable basis to the payment of the commissioner’s 1 consultants and expenses under this subsection as a condition 2 of reviewing a benefit or requirement impacting upon such 3 medical professionals or providers. 4 9. A benefit or direct pay requirement otherwise mandated 5 by state law shall not be included in a basic benefit coverage 6 policy or subscription contract unless the commissioner finds 7 after actuarial review that the inclusion of the benefit or 8 direct pay requirement is cost effective. The commissioner’s 9 finding shall be based upon review of actuarial evidence, 10 including a cost-benefit analysis, and the determination that 11 inclusion of the mandated benefit or direct pay requirement 12 is in the best interests of providing affordable health care 13 coverage. 14 10. A restriction on a cost-containment measure 15 otherwise imposed by state law shall not apply to a basic 16 benefit coverage policy or subscription contract unless 17 the commissioner finds after actuarial review that the 18 cost-containment measure is cost effective, and its exclusion 19 is not in the best interests of providing affordable health 20 care coverage. 21 11. As used in this section: 22 a. “Basic benefit coverage” means coverage of basic health 23 care services rendered by health professionals licensed 24 pursuant to state law together with hospital expenses. 25 b. “Basic health care services” means services which an 26 enrollee might reasonably require in order to be maintained in 27 good health, including at a minimum, emergency care, inpatient 28 hospital and physician care, and outpatient services rendered 29 within or outside of a hospital. 30 c. “Carrier” means the same as defined in section 513B.2. 31 d. “Eligible dependent” means an enrolled dependent of a 32 subscriber entitled to coverage under a basic benefit coverage 33 policy or subscription contract. 34 e. “Policy” means the entire contract between the insurer 35 -3- LSB 5251SS (4) 83 av/nh 3/ 5

S.F. 2121 and the insured, including the policy riders, endorsements, 1 and the application, if attached, and includes individual 2 subscriber contracts issued under chapter 514B. 3 f. “Small employer” means the same as defined in 513B.2. 4 EXPLANATION 5 This bill requires the commissioner of insurance, in 6 cooperation with interested carriers, to develop by rule 7 individual and small employer basic coverage policies or 8 subscription contracts providing basic health benefit coverage 9 to be targeted for sale to individuals under 30 years of age 10 and their eligible dependents who have not had health care 11 benefits within the preceding 12 months. “Basic benefit 12 coverage” means coverage of basic health care services rendered 13 by licensed health professionals together with hospital 14 expenses. “Basic health care services” means services which an 15 enrollee might reasonably require in order to be maintained in 16 good health, including at a minimum, emergency care, inpatient 17 hospital and physician care, and outpatient services rendered 18 within or outside of a hospital. 19 A basic benefit coverage policy or subscription contract 20 must include a disclosure statement including what mandated 21 benefits and providers are not covered, the managed care and 22 cost control features employed, and the term for which the 23 policy or contract is in effect. All forms, policies, and 24 contracts must be approved by the commissioner prior to the 25 issuance or issuance for delivery of such policies or contracts 26 in the state. The commissioner is required to determine what 27 the cumulative loss ratio of such policies or contracts must 28 be. 29 Records must be kept for each basic benefit policy or 30 contract showing enrollment, claim costs, premium income, 31 utilization, and other information as required by the 32 commissioner. Each participating carrier must provide an 33 annual report to the commissioner. 34 The commissioner may use reasonable actuarial evidence to 35 -4- LSB 5251SS (4) 83 av/nh 4/ 5

S.F. 2121 determine what benefits must be included in such coverage, what 1 mandated benefits or direct pay requirements may be excluded, 2 what cost-containment procedures must be employed, and what 3 cost-containment measures otherwise restricted by state law may 4 be utilized in providing such coverage. 5 The commissioner may retain consultants to assist in 6 analysis of benefits and requirements and may assess a fee 7 against participating carriers to defray those costs. The 8 commissioner may also require medical societies or providers’ 9 associations requesting inclusion of a benefit or requirement 10 to contribute to the cost of reviewing the request. 11 Benefits or direct pay requirements or restrictions on 12 cost-containment measures imposed under state law are not 13 required to be included in basic benefit policies or contracts 14 unless determined to be cost effective and in the best 15 interests of providing affordable health care coverage. 16 -5- LSB 5251SS (4) 83 av/nh 5/ 5