A broad omnibus insurance bill that would update Alaska’s insurance code in dozens of areas—including reintroducing health maintenance organization (HMO) authority, revising surplus‑lines and adjuster rules, clarifying owner‑controlled insurance programs and adding licensing for pharmacy benefit managers—was reviewed May 17 by the House Finance Committee and set aside for further consideration with an updated fiscal note to be provided.

Senate Bill 132 (committee substitute version W) contains more than 100 statutory changes across Title 21. Key provisions discussed at the hearing include:

- Health maintenance organizations and managed care: The bill would modernize HMO statutes and allow employers or individuals to buy HMO‑style managed care plans in Alaska, while preserving protections that require HMOs to pay out‑of‑network emergency and other services when in‑state network care is not available. Sponsors said the change is intended to broaden consumer choice and may facilitate Medicare Advantage and similar products in Alaska where managed‑care options are limited.

- Pharmacy benefit managers and third‑party administrators: The House Labor and Commerce companion work clarified that pharmacy benefit managers (PBMs) and third‑party administrators (TPAs) will be licensed rather than merely registered. The committee received a proposed fee structure in the CS: a biannual PBM license fee and a biannual TPA license fee. Department officials said fees are designed to align with other states’ levels; the updated fiscal estimate for the CS includes added revenue from those fees (department estimate: roughly $300,000+) in addition to surplus‑lines adjustments (see fiscal note summary below).

- Surplus lines, wet marine and transportation insurance: The CS narrows some deductions and revises penalty levels for surplus‑lines brokers, allows brokers to pay the surplus‑lines tax on behalf of a non‑admitted insurer in some situations and aligns Alaska definitions and valuation rules with national model practices for reinsurance and reserve valuation.

- Owner‑controlled/contractor‑controlled insurance programs (OCIP/CCIP): The bill clarifies and expands the owner‑controlled insurance program structure (used on large single‑site projects) and lowers the minimum project threshold for multi‑unit residential projects from $50 million to $20 million to improve coverage availability on larger multifamily projects.

- Consumer protections and claims: The CS lengthens notice windows for cancellations (20 to 45 days for some policies), directs the division to review certain motor vehicle service contract forms, expands colorectal cancer screening coverage and prohibits depreciation of labor in actual‑cash‑value residential property claims unless the policyholder expressly opts in after receiving a disclosed price comparison.

- Workers’ compensation assigned risk surcharge threshold: The bill raises the premium threshold that triggers a 25 percent surcharge for assigned‑risk employers from $3,000 to $6,000 to reflect inflation and payroll changes.

Department officials walked the committee through the most consequential fiscal items. Department staff initially submitted a fiscal note for the version T of the bill reflecting a net positive of roughly $110,000 in receipts based on surplus‑lines and related changes. Committee staff and the department said the later CS (version W) includes licensing fees for PBMs and TPAs that are expected to generate substantially more fee revenue (department estimate communicated in committee: roughly an additional $300,000+), bringing the combined revenue estimate for the CS to about $400,000. The committee was told the CS will be finalized with an updated fiscal note and provided to the committee before the bill is transmitted to the floor for further action.

Some committee members voiced caution about managed‑care provisions; they asked whether HMO options could create a ‘‘race to the bottom’’ on coverage or steer members away from established networks. Department officials and the sponsor said protections remain for out‑of‑network emergency care and situations where in‑state providers are unavailable, and noted many large employers and public plans already use managed‑care arrangements.

Given the bill’s complexity, committee members and staff opted to continue review and requested the updated fiscal estimate for the CS. The committee scheduled further action and indicated the bill will be considered on a follow‑up agenda with the updated fiscal note attached.