1Amending the act of April 9, 1929 (P.L.177, No.175), entitled 
2"An act providing for and reorganizing the conduct of the 
3executive and administrative work of the Commonwealth by the 
4Executive Department thereof and the administrative 
5departments, boards, commissions, and officers thereof, 
6including the boards of trustees of State Normal Schools, or 
7Teachers Colleges; abolishing, creating, reorganizing or 
8authorizing the reorganization of certain administrative 
9departments, boards, and commissions; defining the powers and 
10duties of the Governor and other executive and administrative 
11officers, and of the several administrative departments, 
12boards, commissions, and officers; fixing the salaries of the 
13Governor, Lieutenant Governor, and certain other executive 
14and administrative officers; providing for the appointment of 
15certain administrative officers, and of all deputies and 
16other assistants and employes in certain departments, boards, 
17and commissions; and prescribing the manner in which the 
18number and compensation of the deputies and all other 
19assistants and employes of certain departments, boards and 
20commissions shall be determined," establishing the Office of 
21Consumer Advocate for Health Insurance as an office within 
22the Office of Consumer Advocate and prescribing its powers 
23and duties; establishing the Consumer Advocate for Health 
24Insurance Fund; and making editorial changes.

25The General Assembly of the Commonwealth of Pennsylvania
26hereby enacts as follows:

27Section 1. Article IX-A of the act of April 9, 1929 
28(P.L.177, No.175), known as The Administrative Code of 1929, is 

1amended by adding a subarticle heading to read:

2ARTICLE IX-A

3OFFICE OF CONSUMER ADVOCATE

4(a) General Provisions

5Section 2. Article IX-A of the act is amended by adding a
6subarticle to read:

7(b) Office of Consumer Advocate for Health Insurance

8Section 921-A. Definitions.

9The following words and phrases when used in this subarticle 
10shall have the meanings given to them in this section unless the 
11context clearly indicates otherwise:

12"Consumer." A person who is a named insured, insured or 
13beneficiary of a policy of health insurance, including, but not 
14limited to, employers who purchase group insurance for 
15themselves and their employees, or any other person who may be 
16affected in any way by the Insurance Department's exercise of or 
17the failure to exercise its authority.

18"Consumer advocate." The Consumer Advocate for Health
19Insurance established in this subarticle.

20"Department." The Insurance Department of the Commonwealth.

21"Fund." The Consumer Advocate for Health Insurance Fund 
22established in this subarticle.

23"Health insurer." Any "company," "association" or "exchange" 
24as such terms are defined in section 101 of the act of May 17, 
251921 (P.L.682, No.284), known as The Insurance Company Law of 
261921 or any entity that provides health insurance and is subject 
27to 40 Pa.C.S. Ch. 61 (relating to hospital plan corporations) or 
2863 (relating to professional health services plan corporations) 
29or Article XXIV of The Insurance Company Law of 1921 or the act 
30of December 29, 1972 (P.L.1701, No.364), known as the Health 

1Maintenance Organization Act.

2"Office." The Office of Consumer Advocate for Health
3Insurance established in this subarticle.

4Section 922-A. Office of Consumer Advocate for Health 
5Insurance.

6(a) Establishment of office.--The Office of Consumer 
7Advocate for Health Insurance is established within the Office 
8of Attorney General to represent the interests of consumers 
9before the department.

10(b) Consumer Advocate for Health Insurance.--

11(1) The office shall be headed by the Consumer Advocate 
12for Health Insurance appointed by the Governor with the 
13advice and consent of the Senate, who by reason of training, 
14experience and attainment is qualified to represent the 
15interests of consumers.

16(2) The term of the consumer advocate shall be for six
17years.

18(3) Compensation of the consumer advocate shall be set
19by the Attorney General.

20(c) Conflict of interest.--No individual who serves as the
21consumer advocate shall, while serving in the position, engage
22in any business, vocation or other employment, or have other
23interests, inconsistent with the official responsibilities, nor
24shall the individual seek or accept employment nor render
25beneficial services for compensation with any health insurer
26subject to the authority of the office during the tenure of the
27appointment and for a period of two years immediately after the
28appointment is served or terminated.

29(d) Restriction.--Neither the consumer advocate nor an
30employee of the consumer advocate shall be employed by or be

1pecuniarily interested in any health insurance company,
2association or exchange, or in any health insurance business,
3other than as a policyholder.

4(e) Political office.--No individual who is appointed as
5consumer advocate may seek election nor accept appointment to
6any political office during the tenure as consumer advocate and
7for a period of two years after the appointment is served or
8terminated.

9Section 923-A. Assistant consumer advocates for health 
10insurance; employees.

11The consumer advocate shall appoint attorneys as assistant 
12consumer advocates for health insurance and additional clerical, 
13technical and professional staff as may be appropriate, and may 
14contract for additional services as shall be necessary for the 
15performance of the duties imposed by this subarticle. The 
16compensation of assistant consumer advocates for health 
17insurance and clerical, technical and professional staff shall 
18be set by the Attorney General. No assistant consumer advocate 
19for health insurance or other staff employee shall, while 
20serving in the position, engage in any business, vocation or 
21other employment, or have other interests, inconsistent with 
22official responsibilities.

23Section 924-A. Powers and duties.

24(a) Representation of consumer interests.--In addition to 
25any other authority conferred by this subarticle, the consumer 
26advocate shall, in carrying out the responsibilities under this 
27subarticle, represent the interests of consumers as a party, or 
28otherwise participate for the purpose of representing an 
29interest of consumers, before the department in any matter 
30properly before the department, and before any court or agency, 

1initiating proceedings if, in the judgment of the consumer 
2advocate, the representation may be necessary, in connection 
3with any matter involving regulation by the department or the 
4corresponding regulatory agency of the United States, whether on 
5appeal or otherwise initiated.

6(b) Cooperation.--The consumer advocate shall cooperate with
7a navigator or consumer assistant established under the Patient
8Protection and Affordable Care Act (Public Law 111-148, 124
9Stat. 119).

10(c) Exercise of discretion.--

11(1) The consumer advocate may exercise discretion in
12determining the interests of consumers that will be advocated
13in any particular proceeding and in determining whether to
14participate in or initiate any particular proceeding.

15(2) In making a determination, the consumer advocate
16shall consider the public interest, the resources available
17and the substantiality of the effect of the proceeding on the
18interests of consumers.

19(3) The consumer advocate may refrain from intervening
20when, in the judgment of the consumer advocate, intervention
21is not necessary to represent adequately the interests of
22consumers.

23(d) Action on petition.--

24(1) In addition to any other authority conferred by this 
25subarticle, the consumer advocate may represent an interest 
26of consumers that is presented for consideration upon 
27petition in writing by a substantial number of persons who 
28are consumers of a health insurer subject to regulation by 
29the department.

30(2) The consumer advocate shall notify the principal

1sponsors of the petition within a reasonable time after
2receipt of the petition of the action taken or intended to be
3taken with respect to the interests of consumers presented in
4that petition.

5(3) If the consumer advocate declines or is unable to
6represent the interests, written notification and the reasons
7for the action shall be given to the sponsors.

8(e) Name in which action is brought.--

9(1) Any action brought by the consumer advocate before a
10court or an agency of this Commonwealth shall be brought in
11the name of the consumer advocate.

12(2) The consumer advocate may designate a consumer or
13group of consumers in whose name the action may be brought or
14may join with a consumer or group of consumers in bringing
15the action.

16(f) Public statement.--At a time that the consumer advocate
17determines, in accordance with applicable time limitations, to
18initiate, intervene or otherwise participate in a department,
19agency or court proceeding, the consumer advocate shall issue
20publicly a written statement, a copy of which shall be filed in
21the proceeding in addition to any required entry of appearance,
22stating concisely the specific interests of consumers to be
23protected.

24Section 925-A. Duties of department.

25In dealing with any proposed action that may substantially
26affect the interests of consumers, including, but not limited
27to, a proposed change of rates and the adoption of rules,
28regulations, guidelines, orders, standards or final policy
29decisions, the department shall:

30(1) Notify the consumer advocate when notice of the

1proposed action is given to the public or at a time fixed by
2agreement between the consumer advocate and the department in
3a manner to assure the consumer advocate reasonable notice
4and adequate time to determine whether to intervene in the
5matter.

6(2) Consistent with its other statutory
7responsibilities, take action with due consideration to the
8interests of consumers.

9Section 926-A. Assessment upon insurance companies,
10disposition, appropriation and disbursement of
11assessments.

12(a) Estimate of expenditures.--

13(1) Before November 1 of each year, the office shall
14estimate the total expenditures for the office and submit the
15estimate to the Governor in accordance with section 610.

16(2) At the same time the consumer advocate submits the
17estimate to the Governor, the consumer advocate shall also
18submit that estimate to the General Assembly.

19(3) The estimate shall not exceed an amount equal to the
20total assessments as provided in this section.

21(b) Budget procedures.--

22(1) The consumer advocate or designated representatives
23shall be afforded an opportunity to appear before the
24Governor, the Appropriations Committee of the Senate and the
25Appropriations Committee of the House of Representatives
26regarding the estimate.

27(2) If the General Assembly fails to approve the
28consumer advocate's budget for the purposes of this section
29by March 30, the department shall assess insurers on the
30basis of the assessment provided in this section.

1(3) At such time as the General Assembly approves the
2proposed budget, the consumer advocate and the department
3shall make an adjustment in the assessments to reflect the
4approved budget.

5(4) The office shall subtract from the budget finally
6approved by the General Assembly any balance of the
7appropriation to be carried over into the fiscal year from
8the preceding fiscal year.

9(c) Assessment.--For fiscal year 2011-2012 an assessment on
10each health insurer who writes coverages for health and health
11under life/annuity/accident, including annuities, in this
12Commonwealth shall be made. Each health insurer shall be
13assessed an amount equal to the product obtained by multiplying
14$2,000,000 by a fraction, the numerator of which is the direct
15premium collected for all coverages by that health insurer in
16this Commonwealth during the preceding calendar year and the
17denominator of which is the direct premium written on such
18coverages in this Commonwealth by all health insurers in the
19same period.

20(d) Adjustment.--In succeeding years the General Assembly
21may vary the base amount of $2,000,000 based upon the actual
22funding experience and requirements of the office.

23(e) Fund.--All assessments received, collected or recovered
24under this subarticle shall be paid by the department into a
25separate account in the State Treasury, to be known as the
26Consumer Advocate for Health Insurance Fund through the
27Department of Revenue.

28(f) Use of fund.--All assessments paid into the Consumer
29Advocate for Health Insurance Fund shall be held in trust solely
30for the purpose of defraying the cost of the administration and

1performance of the duties of the office, related judicial
2proceedings and other such matters within the jurisdiction of
3the office, and shall be earmarked for the use of, and annually
4appropriated to, the office for disbursement solely for that
5purpose. The fund shall be subject to audit by the Auditor
6General.

7(g) Construction.--Assessments made under this section shall 
8not be considered burdens and prohibitions under section 212 of 
9the act of May 17, 1921 (P.L.789, No.285), known as The 
10Insurance Department Act of 1921.

11(h) Requisitions.--All requisitions upon the appropriation 
12shall be signed by the consumer advocate or the deputies that 
13the consumer advocate may designate in writing to the State 
14Treasurer and shall be presented to the State Treasurer for 
15payment in the manner prescribed under the act of April 9, 1929 
16(P.L.343, No.176), known as The Fiscal Code.

17(i) Balance.--In the event that the fund is dissolved or the
18office is abolished by operation of law, any balance remaining
19in the fund, after deducting administrative costs for
20liquidation, shall be returned to insurers in proportion to
21their financial contributions to the fund in the preceding
22calendar year.

23Section 927-A. Reports.

24The consumer advocate shall annually transmit to the 
25Governor, to the Attorney General and to the General Assembly, 
26and shall make available to the public, an annual report on the 
27conduct of the office. The consumer advocate shall make 
28recommendations as may from time to time be necessary or 
29desirable to protect the interests of consumers.

30Section 928-A. Savings provision and construction.

1(a) No bar to action.--Nothing contained in this subarticle 
2shall limit the right of a consumer to bring a proceeding before 
3either the department or a court.

4(b) No impairment to department.--Nothing contained in this 
5subarticle shall be construed to impair the statutory power or 
6duty of the department to regulate health insurers in the public 
7interest.

8Section 3. This act shall take effect as follows:

9(1) The addition of section 926-A of the act shall take
10effect in 90 days.

11(2) This section shall take effect immediately.

12(3) The remainder of this act shall take effect
13immediately.