Bill Text - SB390 (2010)

Relative to health insurance premium only cafeteria plans.


Revision: May 17, 2010, midnight

SB 390-FN – VERSION ADOPTED BY BOTH BODIES

03/24/10 0934s

05May2010… 1693h

2010 SESSION

10-2762

01/10

SENATE BILL 390-FN

AN ACT relative to health insurance premium only cafeteria plans.

SPONSORS: Sen. Houde, Dist 5; Sen. Hassan, Dist 23; Rep. Nord, Rock 1; Rep. Hammond, Hills 3; Rep. McEachern, Rock 16; Rep. Houde-Quimby, Sull 1

COMMITTEE: Commerce, Labor and Consumer Protection

AMENDED ANALYSIS

This bill permits small employers which employ 2 or more employees and which do not offer employer-sponsored health insurance to all of its employees to establish and maintain a health coverage premium only cafeteria plan.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

03/24/10 0934s

05May2010… 1693h

10-2762

01/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Ten

AN ACT relative to health insurance premium only cafeteria plans.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Section; Protective Legislation; Cafeteria Plan. Amend RSA 275 by inserting after section 43-b the following new section:

275:43-c Required Premium Only; Cafeteria Plan. Each small employer, as that term is defined in RSA 420-G:2, XVI, which employs 2 or more employees in the state of New Hampshire and which does not offer employer-sponsored health insurance to all of its employees, may establish and maintain a health coverage premium only cafeteria plan that satisfies the requirements of 26 U.S.C., section 125, and which is specifically established for the purpose of allowing employees who are not eligible for employer-sponsored coverage to purchase health coverage as defined in RSA 420-G:2, IX in the small group market. An employee who works over 15 hours per week and who is not eligible for an employer-sponsored plan may elect to purchase small group health coverage on an individual basis through a payroll deduction. The employer shall not be required to pay for or otherwise contribute to the cost of any health insurance purchased through the cafeteria plan.

2 New Section; Health Coverage Tax Incentive Plan. Amend RSA 420-G by inserting after section 4-b the following new section:

420-G:4-c Health Coverage Tax Incentive Plan.

I. Any carrier that offers small group health coverage in the state shall make its small employer group coverage available with a limited open enrollment period to individual employees of small employers when the coverage is purchased through a premium only cafeteria plan that satisfies the requirements of 26 U.S.C., section 125 and RSA 275:43-c.

II. A carrier shall offer a limited open enrollment period consistent with the requirements of RSA 420-G:8, I-a during which time an employee having a cafeteria plan under RSA 275:43-c may purchase small employer group health coverage. A carrier may apply its rating factor for group size of one to the premium charged for coverage sold to an employee on an individual basis through a payroll deduction, but shall not apply participation requirements under RSA 420-G:9, I to coverage purchased by an employee through a cafeteria plan established pursuant to RSA 275:43-c.

3 Effective Date. This act shall take effect 60 days after its passage.

LBAO

                      10-2762

                      Revised 05/10/10

                      Amended 05/07/10

SB 390 FISCAL NOTE

AN ACT relative to health insurance premium only cafeteria plans.

FISCAL IMPACT:

      The Insurance Department states this bill, as amended by the House (Amendment #2010-1693h), may increase state revenue, county expenditures, and local expenditures by an indeterminable amount in FY 2010 and each year thereafter. There is no fiscal impact on county and local revenue or state expenditures.

METHODOLOGY:

    The Insurance Department states this bill allows small employers employing 2 or more employees that do not offer employer-sponsored health insurance to all of its employees to establish and maintain a health coverage premium only cafeteria plan. The Department states this bill may increase premium tax revenue if more individuals obtain insurance as a result of this bill. The Department states though this bill does not require employers to contribute to the premium costs for the cafeteria plans, the employer still may have administrative costs associated with establishing the plans. If a municipality or county employs at least 2 employees and chooses to establish and maintain a health coverage premium only cafeteria plan, they may have increased costs associated with setting up the cafeteria plan.