Insurance bill
pushed by business
stalls in House

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By Lyn Danninger
ldanninger@starbulletin.com

A House bill championed by small business that would have increased the amount an employee can pay toward the cost of health insurance is likely stalled for this legislative session.

The next stop for House Bill 2750, which would have given small businesses a two-year option to set the maximum employee contribution for health insurance at 40 percent of the total monthly premium, would have been the House Finance Committee, said Rep. Lei Ahu Isa (D, Alewa Heights), a supporter of the bill and member of the House Committee on Consumer Protection and Commerce.

Ahu Isa said she had expected the bill to move on.

"It was supposed to go to Finance, that's what I thought we had agreed," she said.

Likewise Rep. Bertha Kawakami (D, Koloa), a supporter of the bill, was disappointed the bill did not make it any further.

"The measure was to provide our struggling small businesses with temporary relief right now," Kawakami said. "They need help today, and not in a few years when a task force issues its recommendations."

But Committee Chair Kenneth Hiraki did not schedule the bill for a hearing, thus killing it.

Hiraki (D, Kakaako) said that given the complexity of issues related to Hawaii's Pre-paid Health Care Act, which mandates benefit and premium contribution levels, his recommendation would be that a task force study the entire issue, rather than going for piecemeal solutions.

Another issue for Hiraki is the prominence of the health insurance rate oversight bill, HB 1761.

That bill, backed by the state insurance commissioner, would increase oversight of the way insurance companies set rates for heath insurance. It passed its third reading on the floor of the House yesterday and will now make its way to the Senate.

"We are looking for fair pricing of essential goods and services so this bill would protect small businesses from excessive premiums, especially in light of the lack of competition in the health plan market," Hiraki said.

But a number of business groups have been reluctant to support further government regulation.

Even so, many agree with at least part of the insurance commissioner's argument that the state oversight called for in the bill would at least assure them that health insurance premiums would be reviewed by a second set of eyes.

The Chamber of Commerce of Hawaii, which is against the bill, likes the idea of more openness from insurance companies, but dislikes more government regulation.

"The chamber opposes any type of rate regulation, but supports the need for legislation that mandates full disclosure of all cost drivers," Christine Camp, chairwoman of the chamber's Small Business Council, said in testimony.

The chamber would prefer a four -year assessment of rates to determine if there is a pattern of overcharging, Camp said.

"We want an open book for four years to get an historic overview," she said.

Rate regulation could be justified if after that period it is found to be necessary, Camp said.

But for state Insurance Commissioner Wayne Metcalf, yesterday's floor vote came as a welcome sign regarding the bill's potential to clear the Senate.

"I'm extremely gratified that the House realizes how important it is to have an effective system of checks and balances to protect Hawaii's small businesses and workers when dealing with the two health care plans that so dominate the marketplace," he said.

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