SENATE RESOLUTION No. 90

STATE OF NEW JERSEY

INTRODUCED APRIL 21, 1997

By Senator ZANE

A Senate Resolution establishing a Special Senate Committee on Health Insurer Profits.

Whereas, In the name of economy and efficiency, health insurers are interjecting themselves more and more routinely into decisions of physicians and other health care professionals concerning the care and treatment of their insureds; and

Whereas, Despite these cost-saving efforts at the expense of the peace of mind and well being of their insureds, health care coverage costs continued to rise last year; and

Whereas, At the same time that health insurers are substituting business sense and executive decisions for common sense and medical experience in the name of affordability, many citizens of this State still find the cost of health insurance coverage prohibitive: more than one million people, or approximately 14% of the population of New Jersey, are uninsured; and

Whereas, The fact that health insurance is still unaffordable and therefore an unattainable goal leads to the inescapable conclusion that any economies that have been realized through the efforts of health insurers have increased profits, not affordability; and

Whereas, Moreover, from issues of medical necessity and mandated coverage to the length of hospital stays after surgery, more and more often this Legislature finds itself in the position of considering legislation to counteract the economic incentives and profit-driven policies of health insurers; and

Whereas, This piecemeal approach to health insurer accountability, in the face of the rising costs of health insurance coverage is not in the best interests of the people who have such coverage, not to mention those who cannot afford it; and

Whereas, At the outset then, it only makes sense to examine just how profitable the health insurance business is in New Jersey, and whether insurers are in the midst of a “financial crisis,” as some have claimed; now, therefore;

    Be It Resolved by the Senate of the State of New Jersey:

    1. There is established a Special Senate Committee on Health Insurer Profits to consist of six members of the Senate, no more than three of whom shall be of the same political party, to be appointed by the President of the Senate.

    2. It shall be the duty of the committee to undertake a thorough inquiry into the profits and earnings of health service corporations, medical service corporations, hospital service corporations, health maintenance organizations and commercial health insurance companies doing business in this State. The inquiry shall include a review of such factors as the percentage increase or decrease in health insurance premiums, by insurer, over the past five years; and profits or net earnings of health insurers doing business in this State and the rise and fall thereof over the last five years.

    3. For the purposes of this inquiry the committee shall have all of the powers provided pursuant to chapter 13 of Title 52 of the Revised Statutes.

    4. The committee shall issue a report and make such recommendations to the Senate as it shall determine to be appropriate based on an analysis of the facts resulting from the inquiry.

STATEMENT

    This resolution creates a special Senate committee to investigate the profits and earnings of health insurers doing business in the State. The Special Senate Committee on Health Insurer Profits will be a bi-partisan committee comprised of six members of the Senate appointed by the President. Granted subpoena powers, it is charged with reviewing such factors as the percentage increase or decrease in health insurance premiums, by insurer, over the past five years; and the profits or net earnings of health insurers doing business in the State, and the rise and fall thereof over the last five years. Health insurers subject to the committee's scrutiny will include health service corporations, medical service corporations, hospital service corporations, health maintenance organizations and commercial health insurance companies doing business in New Jersey.

Establishes a Special Senate Committee on Health Insurer Profits.