Committee advances H.137 studies on banking fraud, coerced debt and genetic privacy; Medigap rate-review language removed for health committee

The House Committee on Commerce & Economic Development on Feb. 25 considered draft 1.3 of an amendment to H.137 that would (1) require the Department of Financial Regulation (DFR) to study models for bank transaction holds, protections for victims of coerced debt and whether insurers should be limited from accessing consumers' direct‑to‑consumer genetic test reports, and (2) include new language for public review of Medicare supplement (Medigap) insurance rate filings. After hearing from DFR and the Office of the Health Care Advocate, the committee agreed to remove the Medigap sections and let the Health Care Committee draft that amendment.

The amendment would require DFR, when it receives a request to increase premiums for a Medicare supplement policy, to post the filing within five business days on the department website with the insurer's name; the overall composite average increase requested; increases by plan type; the proposed effective date; the SURF tracking number; whether a public hearing is required; and instructions for public comment. The draft sets a threshold that would trigger mandatory hearings when a requested composite average rate increase exceeds 10 percent for an insurer that has 5,000 or more lives in Vermont's Medigap market. The language removes a second independent actuarial review previously included and instead adds a public‑input and hearing process for filings that meet the threshold. The Department requested an effective date of Jan. 1, 2026.

Jen Kirby, Legislative Counsel, presented the redlined language. Mary Block of the Department of Financial Regulation said "some of that information is posted on our website, but not, all of it exactly," and that the department's rates and forms staff do not foresee difficulties posting the additional items within five business days. Mike Fisher, House Health Care Advocate, said he did not want the process to resemble the formal Qualified Health Plan hearings with evidentiary presentation and cross‑examination and said he supported an informal resolution where possible.

DFR staff warned that using the word "shall" for hearings would likely trigger contested‑hearing procedures under the Administrative Procedure Act and agency rules, including requirements for a hearing officer and a formal docket. As Maria Bridal of Legislative Council summarized, the department and stakeholders will try to craft language that allows public input while avoiding the full contested‑hearing mechanics where possible.

Committee members concluded there was not yet consensus on the Medigap text. The committee instructed Legislative Council to remove the Medigap sections from draft 1.3 and produce a draft 1.4 without those sections so the bill can move forward; the Health Care Committee will take up Medigap language as a floor or committee amendment. Maria Bridal said she would prepare the revised draft and circulate it for edits. The committee did not record a roll‑call vote on the underlying amendment during the meeting; members agreed by consensus to exclude the Medigap language before advancing H.137.

Separately, the committee reviewed three study mandates proposed in the commerce amendment:

- A study on regulatory models that would allow financial institutions to impose transaction holds to protect account holders from suspected fraudulent transactions, including recommended notification procedures, reasonable hold durations, immunity for institutions acting in good faith and which institutions or account holders should be covered. The commissioner is directed to consult with the Vermont Bankers Association, Association of Vermont Credit Unions, AARP Vermont, the Attorney General's Office, Vermont Legal Aid and other stakeholders, and report draft findings to the committee and Senate Finance by Nov. 15, 2025.

- A study on protections and remedies for victims of coerced debt that would review the National Consumer Law Center model state coerced‑debt law (May 2024), define "coerced debt," consider whether both secured and unsecured debts should be covered, set investigative and notice procedures for creditors (including whether collection should cease pending an investigation), consider credit‑report removal processes, and recommend statutory changes. The commissioner would consult the Vermont Network, banking and credit union trade groups, the Attorney General's Office and Vermont Legal Aid and report draft recommendations by Nov. 15, 2025.

- A study on insurance access to consumer genetic information not contained in medical records, asking whether Vermont should prohibit or limit insurers' access to direct‑to‑consumer personalized genetic test reports (for health, long‑term care, life or disability insurance), and whether consumers should have to consent to disclosure. DFR staff noted current prohibitions on using such information exist under the state's unfair trade practices for uses not in a medical record, but the draft would consider broadening restrictions to acquisition of that data as well.

Committee members discussed stakeholder participation and agreed that DFR should consult relevant parties listed in the draft. Maria Bridal said the draft will be edited, returned to the committee and posted; the committee planned to vote out the commerce amendment without the Medigap language so that health committee members can finalize that section.

The committee's next step is to accept the edited commerce amendment (without the Medigap sections) as draft 1.4 and proceed to the floor; Legislative Council will circulate the revised draft and the Health Care Committee will take up Medigap language for a separate amendment or floor amendment.