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Chairman Vincent C. Gray A BILL IN THE COUNCIL OF THE DISTRICT OF COLUMBIA To establish the Healthy DC Program; to require that District residents maintain health insurance coverage; to increase Medicaid fee-for-service reimbursement rates; to amend the Healthy DC Fund to allow for additional revenue to be deposited; to require health maintenance organizations to pay a premium tax; to increase the cigarette tax and to raise the premium tax imposed on health insurers in the District; and, to require that all products on the individual health insurance market be guaranteed issue and community rated. BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this act may be cited as the “Healthy DC Act of 2008”. TITLE I - Healthy DC Program Sec. 101. Definitions. For purposes of this title, the term: (1) “Employer” means any individual, firm, association, or corporation, any receiver or trustee of any individual firm, association, or corporation, or the legal representative of a deceased employer who uses the services of another individual for pay in the District. (2) “Employee” means any individual who has been employed by the same employer for 1 year and has worked at least 1000 hours without a break in service, except for regular holiday, sick, or personal leave granted by the employer. (3) “Health insurer” means any person that provides one or more health benefit plans or insurance in the District of Columbia, including an insurer, a hospital and medical services corporation, a fraternal benefit society, a health maintenance organization, a multiple employer welfare arrangement, or any other person providing a plan of health insurance subject to the authority of the Commissioner of the Department of Insurance, Securities and Banking. Sec. 102. Establishment of Healthy DC Program; administration. (a) There is established the Healthy DC Program (“Program”) which shall provide affordable health insurance benefits to eligible individuals. (b) The Program shall be administered by the Department of Health Care Finance, established by the Department of Health Care Finance Establishment Act of 2007, effective February 27, 2008 (D.C. Law 17-109; 55 DCR 216). Sec. 103. Program eligibility. An individual shall be eligible for the Program if the individual: (1) Has resided in the District for at least 6 months at the time of application to the Program; (2) Resides in a household having a gross household income greater than 200% of the Federal Poverty Guidelines as updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. 9902(2); (3) Does not qualify for the District of Columbia HealthCare Alliance, Medicare, Medicaid, or other federal health benefits programs; and (4)(A) Has not had health insurance during the 6-month period prior to application to the Program;
Sec. 104. Program benefits; affordability. (a) The Program shall provide, at minimum, the following health benefits:
(b) The Program shall maintain the following affordability criteria for individual participants:
Sec. 105. Program implementation; funding. (a) The Mayor shall make the Program available to eligible individuals by July 1, 2009. (b) To meet the deadline set forth in subsection (a) of this section, the Mayor is authorized to enter into a contract with CareFirst, Inc. to implement and carry out the Program. (c) Any contract entered into pursuant to this section shall require annual reporting of clinical quality measurements and utilization data to the Mayor. (d) The Program shall be funded through the Healthy DC Fund as established by section 15b of the Hospital and Medical Services Corporation Regulatory Act of 1996, effective March 2, 2007 (D.C. Law 16-19; D.C. Code § 31-3514.02) (“Fund”). Sec. 106. Notice of change in insurance requirement. (a) Prior to eliminating or restricting the availability of any health insurance plans offered in the District, a health insurer shall submit a notice of change to the Commissioner of the Department of Insurance, Securities and Banking explaining the proposed change. The notice of change shall be submitted in a manner and form determined by the Mayor. (b) The failure or refusal to submit a notice of change required by this section shall be subject to a civil penalty not to exceed $10,000 for each such failure or refusal. Sec. 107. Employer reporting requirement. (a) Beginning in 2010, employers shall submit an annual report, in a manner and form determined by the Mayor, attached to their tax return that includes the following information for the prior calendar year:
(b) Any employer that refuses or otherwise fails to submit the report required by this section shall be subject to a civil penalty not to exceed $10,000 for each such refusal or failure. Sec. 108. Employer maintenance of effort. (a) Beginning in 2009, an employer shall be required to maintain the same level of per employee health care expenditure as it did during the prior calendar year, unless granted a waiver of compliance with this requirement by the Mayor. For purposes of this subsection, the per employee health care expenditure shall be the average per employee cost to the employer of providing health insurance benefits on an expense reimbursed or prepaid basis to those employees located in the District of Columbia. (b) An employer found by the Mayor to be in violation of this section shall be subject to a fine of not less than double the difference between the employer’s total required expenditure to provide health insurance benefits on an expense reimbursed or prepaid basis to its employees located in the District and the employer’s actual expenditure. Sec. 109. Prohibitions. (a) It shall be unlawful for a health insurer to eliminate or restrict the availability of a health insurance plan offered in the District with the intent of shifting beneficiaries to the Program. A health insurer found to be in violation of this subsection shall be subject to a fine of not less than $10,000. (b) It shall be unlawful for an employer that provides or contributes toward the cost of group health insurance benefits on an expense reimbursed or prepaid basis for its employees to eliminate such benefits or to change the terms of an employee’s employment with the intent of shifting responsibility for employee health insurance to the Program. An employer found by the Mayor to be in violation of this section shall be subject to a fine of not less than double the difference between the employer’s required health expenditure and the employer’s actual health expenditure for the calendar year in which the violation was found. Sec. 110. Disposition of fines and penalties. Fines and penalties collected pursuant to this title shall be deposited in the Fund. Sec. 111. Rulemaking. The Mayor, pursuant to Title I of the District of Columbia Administrative Procedure Act, approved October 21, 1968 (82 Stat. 1204; D.C. Official Code § 2-501 et seq.), shall issue rules to implement the provisions of this title. TITLE II - Individual insurance mandate Sec. 201. Definitions. For purposes of this title, the term “continuous health coverage” means the ongoing participation by an individual in a health insurance plan, either as an individual or as a named beneficiary on another individual’s coverage, with no lapse in coverage exceeding 63 days in any calendar year. Sec. 202. Individual mandate. By July 1, 2009, each District resident who is 18 years of age or older shall obtain and maintain continuous health coverage. Sec. 203. Compliance; penalties. (a) Beginning January 1, 2011, each individual required to maintain continuous health coverage pursuant to section 202 shall certify under penalty of perjury in his or her income tax return for the prior calendar year that for that prior calendar year, the individual either:
(b)(1) The failure to meet the requirement set forth in section 202 for a calendar year shall result in a penalty. The amount of the penalty shall be determined by the Mayor; provided, that it shall be no less than $250.
(c) Any penalties collected pursuant to this section shall be deposited in the Healthy DC Fund as established by section 15b of the Hospital and Medical Services Corporation Regulatory Act of 1996, effective March 2, 2007 (D.C. Law 16-19; D.C. Code § 31-3514.02). Sec. 204. Exemptions; waiver. (a) An individual for whom the requirement set forth in section 202 would violate the established tenets and practices of his or her religion shall be exempt from the requirements of this title. (b)(1) The Mayor may grant an economic hardship waiver from the requirement set forth in section 202 to an individual whose annual premium costs would exceed 6% of gross income.
Sec. 205. Rulemaking. The Mayor, pursuant to Title I of the District of Columbia Administrative Procedure Act, approved October 21, 1968 (82 Stat. 1204; D.C. Official Code § 2-501 et seq.), shall issue rules to implement the provisions of this title. TITLE III - Medicaid reimbursement rates Sec. 301. Reimbursement rates. The Department of Health Care Finance, established by the Department of Health Care Finance Establishment Act of 2007, effective February 27, 2008 (D.C. Law 17-109; 55 DCR 216), shall increase the specialty physician and primary care physician reimbursement rates under the District Medicaid fee-for-service program to match the specialty physician and primary care physician reimbursement rates under the federal Medicare program. Sec. 302. Funding. Implementation of this title shall be subject to appropriations. TITLE IV - Healthy DC Fund amendment Sec. 401. Section 15b of the Hospital and Medical Services Corporation Regulatory Act of 1996, effective March 2, 2007 (D.C. Law 16-192; D.C. Official Code § 31-3514.02.), is amended to read as follows:
TITLE V - Tax amendments. Sec. 501. The Health Maintenance Organization Act of 1996, effective April 9, 1997 (D.C. Law 11-235; D.C. Official Code § 31-3401 et seq.) is amended by adding a new section 4a to read as follows:
Sec. 502. Title 47 of the District of Columbia Official Code is amended as follows: (a) Section 47-2402(a) is amended by striking the phrase “$.05 for each cigarette.” and inserting the phrase “$.10 for each cigarette.” in its place. (b) Section 47-2608(a) is amended as follows:
TITLE VI - Insurance market regulation Sec. 601. Definitions. For purposes of this title, the term: (1) “Community rated” means an insurance premium that is calculated based on the costs for all covered individuals divided by the number of covered persons so as to produce a single per person rate that reflects the average total costs of all members in an individual coverage plan. (2) “Guaranteed issue” shall mean that no carrier shall decline coverage for an individual. Sec. 602. Individual insurance market. Beginning July 1, 2009, all health insurance policies issued to individual subscribers, including any policies issued pursuant to the Healthy DC Program established by the Healthy DC Act of 2008, as introduced on April 1, 2008 (D.C. Bill 17-__), shall be guaranteed issue and community rated. Sec. 603. Policy maintenance. All individual health insurance policies issued prior to July 1, 2009, shall continue in force until renewal. Upon renewal, the policy shall comply with section 602. TITLE VII Sec. 701. Fiscal impact statement. The Council adopts the fiscal impact statement in the committee report as the fiscal impact statement required by section 602(c)(3) of the District of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(3)). Sec. 702. Effective date. This act shall take effect following approval by the Mayor (or in the event of veto by the Mayor, action by the Council to override the veto), a 60-day period of Congressional review, as provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)), and publication in the District of Columbia Register. |
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