Feb. 26, 2024

Insurance Department Commissioner Michael Humphreys, Chief of Staff Jodi Franz, and Bureau Director for Budget and Procurement Anu Upadhyaya testified today before the House Appropriations Committee. House Republicans focused their questions on the financial health of the Pennsylvania Insurance industry and how the Pennsylvania Insurance Department (PID) is allocating its funding. Concerns were raised about the Governor’s proposal to transfer $50 million from the Workers’ Compensation Security Fund for the benefit of subsidizing low- and middle-income families’ health insurance premiums. Additionally, Republicans asked questions regarding flood insurance, Pharmacy Benefit Managers, and Pennsylvania’s insurance program Pennsylvania Health Insurance Exchange Authority (PENNIE).

Key Takeaways

· The Governor’s budget proposal raids the Workers’ Compensation Security Fund (WCSF) of $50 million to pay for supposed “one-time” costs.

     o House Republicans questioned the legality of transferring this money out of the WCSF and expressed concern that this proposal is not just a one-time cost – like other budget gimmicks included in the Governor’s Budget – and will result in increased recurring costs, further adding to Pennsylvania’s structural deficit.

· Pharmacy Benefit Mangers continue to drive a wedge between large corporate entities and locally owned small and independent pharmacies. House Republicans pressed the PID on what it is doing to even the playing field and if more authorization through the law is needed.

· Car insurance rates around the Commonwealth, specifically in Southeastern Pennsylvania, have seen significant premium increases. House Republicans asked what actions the department is taking to ensure these cost increases are appropriate and what external factors may be driving these increases.

· PENNIE is Pennsylvania’s health insurance marketplace and helps Pennsylvanians find financial assistance to lower healthcare costs. House Republicans asked PID how fiscally strong the program is and what metrics are being used to determine its success.

     o There were no clear guidelines or metrics provided to the Committee, adding to the trend of unaccountable spending within Governor Shapiro’s budget proposal.

Notable Q&A

Rep. Natalie Mihalek asks the Insurance Department how they can help small independent pharmacies avoid being priced out of the market by corporate Pharmacy Benefit Managers. 

Rep. Ann Flood discusses the need for affordable flood insurance in Pennsylvania and how PID and the General Assembly can work together to share the importance of flood insurance. 

Rep. John Lawrence asks what is causing car insurance rates to increase so high in Pennsylvania. 

Full Hearing

Watch the full hearing here.

Rep. Seth Grove, Republican Chairman of the PA House Appropriations Committee
196th Legislative District
Pennsylvania House of Representatives