LEG-REG REVIEW
by Phillips Associates

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LEG REG REVIEW
2004, Fifth Issue
 
LEG REG REVIEW is a periodic newsletter produced by PHILLIPS ASSOCIATES, a professional lobbying and consultant firm based near the State Capitol.  It contains news on the Legislative and Regulatory scene in Pennsylvania that may be of use to insurance producers, companies, and interested parties.  It is a free Member Service if you are a member of the Pennsylvania Association of Health Underwriters (PAHU) or the PA Surplus Lines Association (PSLA).  Subscription information may be obtained by contacting PHILLIPS ASSOCIATES at 717/728-1217, Fax 717/728-1164 or E-mail to xenobun@aol.com.
 
HICKERNELL INTRODUCES PRODUCER LICENSING BILL
 
On February 3, Rep. Dave Hickernell (R-Lancaster) introduced HB 2328 to create a provisional license for new insurance producers because of the delays some have experienced in getting their FBI criminal background check completed in a timely way.  The delay (it is argued) prevents new people from entering the business and effectively poses an economic hardship on the agency as well if it has to pay a non-selling producer for 90 days. This provisional license would have to be requested by the license applicant who accepts liability for consequences of insurance sold during the 90-day provisional period. 
 
SENATE JUDICIARY COMMITTEE TAKES UP CAPS
 
This week the Senate Judiciary Committee will take up several measures dealing with capping non-economic damages.  Except for SR 160, they all seek to amend the PA Constitution to permit the General Assembly to cap awards.  None of them seek to cap economic damage awards.  Even if these were to pass the legislature, the measure would have to pass the General Assembly next session and then go to voter referendum.
 
-          SB 50, sponsored by Sen. Jake Corman (R-Centre), would cap all non-economic awards.  Presumably, this would include product liability as well.
-          HB 1326, sponsored by Rep. Mike Turzai (R-Allegheny) is similar to SB 50.
-          SB 1000, sponsored by Sen. Steward Greenleaf (R-Montgomery), limits the cap provision to Medical Malpractice situations and then only if there is no “reckless willful or wanton misconduct or (the medical procure) does not result in an injury determined by a fact finder to be a serious impairment of bodily function, serious disfigurement, or death”.
-          SR 160, sponsored by Sen. Jane Orie (R-Allegheny), directs the Joint State Government Commission to study the feasibility of establishing an alternative to the existing liability system as it relates to Medical Malpractice.
 
BUDGET SPEECH REFERENCES INSURANCE
 
Governor Ed Rendell’s Budget address received headlines over issues such as a massive environmental bond issue or by putting the repeal of the Capital stock and Franchise Tax back on track.  There were a number of references to insurance.  He expressed the priority this Administration gives to curbing health care (and health insurance) costs.  A specific idea was to establish a consumer liaison unit within DOI.
 
 
ON THE REGULATORY SIDE
 
·        The Eligible Surplus Lines list was published in the PA Bulletin.  The information lists eligible companies and gives their addresses.  A quick way to access this information is to go to the PA Surplus Lines Association web site, www.pasla.org.
·        The Insurance Department has received an application from Aetna Dental to merge with Aetna Life.
 
HAY REPORT SEEKS STATE SCHOOL BENEFIT PLAN
 
Per HR 159, the Hay Group and the Legislative Budget and Finance Committee released a report that, as expected, supports consolidation of all school district health benefit plans into one administered by the state.  It did reference opposition to a mandatory system from groups such as PAHU, the PA Federation of Teachers, and some of the Blues.
 
POLITICAL NOTES
 
·        According to news reports, Rep. Ellen Bard (R-Montgomery) will not run for re-election and will instead concentrate on winning the GOP nod for the congressional nomination in the 13th district.
·        Republicans won another special House election, this time in Columbia County to fill the position vacated by John Gordner upon his election as Senator in a special election.  (Gordner succeeded Ed Helfrick who retired due to illness.)  The new House member is David Millard.  The party ratio remains 104 R – 94 D.
 
LITITZ MUTUAL WINS NATIONAL RECOGNITION
 
Profiled in January 2004’s A.M. Best Review was Pennsylvania’s Lititz Mutual Insurance Company because of its fifty-year A-plus rating with A.M. Best.  There were only 18 P/C insurance companies in the U.S. making the list and Lititz Mutual was the only PA insurer.
 
OTHER LEGISLATIVE UPDATES
 
-         On Feb. 4, the House Health and Human Services moved HB 1187 establishing a Toxic Mold Task Force.  Insurers would be included in its makeup.  This same committee did not move HB 2299, the Health Savings Account (H S A) bill.
-         The Labor Relations meeting scheduled for this week is now March 17.
-         Introduced by Rep. Ken Ruffing (D-Westmoreland) is HB 2352 to create a Landslide Insurance Program within PEMA.
-         The House Veterans Affairs and Emergency Preparedness Committee plans a Feb. 12 hearing on HB 1060 (Vance-R-Cumberland) on updating the law relating to emergency medical services. 
House Appropriations Committee plans an open forum for House members to state their views on the 2004-2005 Budget unveiled by the Governor last week.

 

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