Untangling Rules and Law

A worried father called me early one morning. His 22-year-old daughter needed health insurance. He heard about the bill I wrote to allow adult children to be covered on their parents’ health plan until the adult child turned 27.

I explained to the father that my bill was picked up by the Governor and added to the state budget.  The new law takes effect on January 1, 2010 and applies to young adults who are not married and have not been offered health insurance through their employer at less cost than their parent’s plan.

The father asked a lot of questions. He said he contacted his health insurance company and didn’t receive clear answers.

Unknown to me, the Executive Branch also received many questions about the new law. Most came from health insurance companies. Two days later the Governor signed an Emergency Rule to clarify answers to those questions.

I was grateful for the attention the Governor paid to the new law. But when I read the Emergency Rule, I discovered the intent of the bill I drafted last winter was changed by that Rule.

I drafted a bill to allow parents to cover their adult children at no more cost than paid for their dependents under age 18. I wrote the bill so parents could get affordable coverage for their young adult children who did not have a job offering affordable health care coverage. There was to be no underwriting, no exclusions, no added pre-existing conditions and no new hidden costs.

In the Emergency Rule, which has the force of law, insurance companies who wrote individual insurance plans would be able to limit coverage to young adults who wanted insurance under their parent’s plan.

The Rule allowed health insurance companies to increase rates for dependents over age 18, to allow the exclusion of pre-existing conditions and to place exclusion riders on coverage.  An exclusion rider on a policy means the insurance company would never cover a certain condition.

How could a bill become a law only to be changed by an Emergency Rule? And an Emergency Rule that provided answers to the father’s questions I never intended when I wrote the bill ten months ago.

First one has to understand the rule making process.  When bills become law, there are details related to implementing the new law that are finalized through Administrative Rules.  Usually Administrative Rules are written by an agency in the Executive Branch of government and go through what is called a ‘promulgation’ process.  During the promulgation of an Administrative Rule, public input is gathered through public hearings.  The Legislature also has one more opportunity to help craft the details of the Administrative Rule when it referred to a legislative standing committee for review.

Implementing an Emergency Rule does not require legislative action.  An agency determines an ‘emergency’ exists and writes a rule to address that ‘emergency’.  Once signed by the Governor, the rule is in effect for 150 days.  The Legislature’s only role in this process is approving an extension of the Emergency Rule for another 120 days.

The only ‘emergency’ related to my bill allowing parents to provide insurance coverage for their adult children was created by insurance companies.  And the Emergency Rule ‘clarified’ the law in favor of those health insurance companies and not consumers.

I called the legislative attorney who drafted my bill and asked her to draft another bill. This time to make it very clear children covered by their parent’s health insurance plan would not have to pay more or be denied coverage.

The real emergency was not with health insurance companies, it is with those who do not have access to affordable health care…like the 22-year-old young adult whose father called me early one morning.