ARIZONA HOUSE OF REPRESENTATIVES FIRST REGULAR SESSION - 1999

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_DP__ For Committee on BANKING AND INSURANCE

_X___ For Committee on APPROPRIATIONS

____ For Caucus and COW

_____ As Passed the House

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Abstract for HB 2627 (insurance; risk pools) Sponsor: Schottel

Risk pools shift the cost of issuing coverage to high risk individuals to a separate funding stream. Pools are funded by the State or by insurer assessments which spread the excess costs of covering high risk individuals over the whole market.

· ARS 42-3052 imposes a luxury tax on the purchase of spirituous liquors and tobacco products.

· Tobacco Settlement Revenues ($ in millions)

Fiscal Year $

1999 35.4

2000 94.5

2001 102.0

2002 122.5

2003 123.7

2004-2007 103.2

2008-2017 105.3

2018-2024 118.0

Provisions:

HB 2627 requires the State Treasurer to deposit the following into the health insurance risk pool premium reduction fund:

1) fifteen percent (15%) of the tobacco master settlement agreement monies, and

2) fifteen percent (15%) of all luxury tax monies collected pursuant to tobacco sales.

The Department of Insurance is required to set up a risk pool and administer the funds in a manner that reduces the cost for risk pool insurance premiums.

· The fund is subject to legislative appropriation.

HB 2627 passed the Banking and Insurance Committee unamended.

Prepared by: Jonathan Diesman

hb2627.app 2/24/99 bh

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