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SPONSOR: |
Martinez |
DATE TYPED: |
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HB |
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SHORT TITLE: |
Insurance Licensure Procedure |
SB |
557 |
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ANALYST: |
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APPROPRIATION
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
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FY03 |
FY04 |
FY03 |
FY04 |
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See Narrative |
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Responses Received From
Public Regulation Commission (PRC)
Department of Health (DOH)
SUMMARY
Synopsis of Bill
Senate Bill 557 clarifies
the requirement for health insurers to “provide” coverage for contraceptive
drugs or devices instead of being required to only “offer” this coverage with a
prescription drug benefit.
SB
557 contains several changes designed to address agent
licensing reciprocity requirements of the federal Gramm-Leach-Bliley Act (GLBA)
in order to make New Mexico a reciprocal state.
These items are all addressed to eliminating barriers to agent licensing
for non-residents.
Other changes to the
Insurance Code include:
·
Makes monthly rather than daily transfers to the law
enforcement protection fund,
·
Gives discretion to increase special deposits based
on company risk factors,
·
Makes agent appointment effective when approved by
superintendent rather than when filed,
·
Uses non-work compensation property and casualty
forms as soon as they are approved,
·
Property and casualty rate filings can reference
previously filed loss cost filings,
·
Makes bail bond license suspension/revocation
procedure like all other licensees, and
·
Repeals loophole in penalty for use of unapproved
forms.
Significant Issues
The PRC provided the
following:
·
Daily transfer of funds is impractical,
costly, and time-consuming.
·
Special deposits held by the
superintendent for each insurer doing business in NM are sometimes inadequate,
particularly when a company is showing signs of hazardous financial condition,
or when the domiciliary regulator attempts to penalize New Mexico citizens for
resorting to the deposit in the event of insolvency.
·
Recent experience indicates that bank
certificates of deposit are not reliable security for statutory deposits. Banks sometimes will cash out the CD, paying
the cash to the insurer, without notifying the Superintendent of Insurance that
the CD being held by the Superintendent has become worthless.
·
Insurance Division staff has interpreted
the rate and form filing laws to require that a rate or form may not be used
for at least 60 days from the date of filing.
SB 557 clarifies that the rate or form may be used as soon as the
Superintendent approves the filing.
·
There are conflicting provisions in
existing law regarding the procedure for suspension or revocation of bail bond
licenses. SB 557 makes the procedure for
bondsmen the same as for all other licenses issued under the Insurance Code.
·
Existing law contains a loophole creating
a lesser penalty for use of a form that has been filed and expressly
disapproved than the penalty for use of forms that have simply not been approved
or not filed at all. SB 557 eliminates
the lesser penalty.
The DOH believes that
SB 557 is critical to assuring access to needed contraceptive drugs and devices
to prevent unwanted and unintended pregnancies. Among live births in NM from
1997-99, an estimated 45% of these pregnancies were unintended. Among women
with an unintended pregnancy, 42% reported using some method of contraception
at the time they became pregnant. The
data suggest problems of access to reliable methods and problems of correct
usage. Every dollar spent for
contraceptive services saves $3 in public funds related to unintended pregnancies.
Using
Unmet needs are
great; among all women who want and need family planning services, the State's
public and private sector providers serve only 51% of all women in need and 65%
of teenagers in need. An estimated
199,070 women in New Mexic, including 31,310 teenagers, are in need of
contraceptive services and supplies.
Publicly supported contraceptive services in
SB557 will require
all group health plans to provide contraceptive benefits as part of a drug
benefits plan. Although it is not possible to quantify the number of women who
will benefit from this requirement, there is no doubt SB 557 will extend
coverage to some women who do not currently have access to contraceptives.
FISCAL IMPLICATIONS
SB 557 makes the Insurance
Code easier to administer and more internally consistent.
ADMINISTRATIVE
IMPLICATIONS
After procedures are
implemented SB 557’s provisions should use less staff resources
DW/yr