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HCAI board questions $5 maximum penalty and asks staff to draft clearer enforcement motion for November
Summary
Board members questioned whether the $5 maximum penalty and an analysis showing a midrange impact of about 1.46% of plan net profit would deter bad actors, requested a statistical review, and directed staff to draft a motion for the November meeting clarifying how remedies and administrative processes interact.
At a Department of Health Care Access and Information board meeting, members questioned whether a proposed maximum penalty — cited in staff materials as $5 and shown in analysis as producing an average impact of about 1.46% of a health plan’s annual net profit — is large enough to deter noncompliance.
Board members said the staff analysis shows a range from negative 3% to 3.8484% and raised concerns that firms might treat a small maximum penalty as a cost of doing business. "If someone says, oh, okay. Well, it's gonna cost me 1.46% of my profit or 2% or something. So I I not sure how much of a deterrence that is if you decide it's a cost of…
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