Mr. Speaker, I rise in opposition to SB 1127, SD1 HD3 CD1, relating to Health Insurers Assessments.
This bill imposes a $10,000 minimum annual assessment or tax on health insurers such as HMOs. It also imposes a one time, ONE MILLION DOLLAR tax that must be paid by September 30th of this year. This one time tax is imposed regardless of whether the organization is for profit or not for profit, large or small, profitable or not profitable.
This HMO tax will be passed on to the customer - businesses and families that buy health plans. It will increase the cost of living and the cost of doing business in Hawaii. Our economy needs to be stimulated, not strangled.
I am also concerned that the one million dollar assessment may cause smaller health care insurers to stop doing business in Hawaii. The better approach would be to tie the fee to the number of persons insured.
Finally, think about a mainland HMO that starts doing business in Hawaii in 2000. They were not here on September 30, 1999, and so did not pay the one million dollar assessment. Those who did pay the tax will feel they have not been treated fairly. Defeat this bill.