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HB 4207

Insurance: health benefits; excluding federal excepted benefits from a health insurance policy; provide for. Amends sec. 3701 of 1956 PA 218 (MCL 500.3701). TIE BAR WITH: HB 4208'25

2025-2026 Regular Session Introduced by Brenda Carter and 1 co-sponsor

HB 4207 clarifies Michigan law: health benefit plans for small employers do not include coverage that is only federally defined excepted benefits, aligning with federal rules.

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Bill Summary · HB 4207

Summary — HB 4207 (Insurance: excepted benefits excluded from "health benefit plan")

Sponsor: Rep. Mike Harris | Tie-bar: HB 4208 (Rep. Brenda Carter)
Statutes amended: MCL 500.3701 (Chapter 37 — Small Employer Group Health Coverage); related amendment in HB 4208 to MCL 500.608 (Chapter 6)
Federal reference: 42 U.S.C. §300gg–91 (definition of “excepted benefits”)

Purpose / Intent

HB 4207 updates Michigan’s Insurance Code to make clear that “health benefit plan” (as used in Chapter 37 governing small-employer coverage) does not include coverage that is only for federal “excepted benefits.” The change is intended to align state definitions with federal law and remove ambiguity faced by insurers offering supplemental or limited benefit products.

Key provisions

  • Replaces the existing state-specific list of exclusions in the definition of “health benefit plan” with a single cross‑reference: coverage only for excepted benefits as defined in federal law (42 U.S.C. §300gg–91).
  • (Companion bill HB 4208) Amends the statutory definition of “health insurance policy” in Chapter 6 to likewise exclude policies that provide only federally defined excepted benefits.
  • The bills are tie‑barred: each bill can take effect only if both are enacted.

What are “excepted benefits” (federal definition, examples)

Under 42 U.S.C. §300gg–91, excepted benefits generally include (but are not limited to):
- Accident‑only or disability income insurance
- Coverage issued as a supplement to liability insurance
- Liability and automobile liability insurance
- Workers’ compensation and similar insurance
- Automobile medical payment insurance
- Credit‑only insurance
- On‑site clinic coverage
- Limited dental or vision benefits (if offered separately)
- Long‑term care or nursing‑home care benefits (if offered separately)
- Hospital indemnity or fixed indemnity insurance (if independent, non‑coordinated)
- Medicare supplemental coverage and certain military supplemental coverages (if separate policies)

Who is affected

  • Small‑employer carriers and other insurers offering supplemental, limited, or stand‑alone products in Michigan.
  • Small employers and their employees (small employer defined in Chapter 37 — generally 2–50 employees under current statute).
  • Regulators: clarifies which products are subject to the substantive requirements that apply to “health benefit plans.”

Rationale and likely impact

  • Rationale: committee testimony and analysis state the change is technical and intended to reduce confusion about whether federally excepted benefits fall under state regulatory requirements applicable to comprehensive health plans.
  • Practical effect: products that qualify as federally excepted benefits will be expressly excluded from the state definitions of “health benefit plan” and “health insurance policy,” reducing uncertainty about state treatment and compliance obligations. The bills do not change federal law or the federal scope of excepted benefits.

Fiscal impact

  • Nonpartisan fiscal analyses report no fiscal impact on State or local government.

Procedural status / timeline (select actions)

  • Introduced in House: March 11, 2025 (Rep. Mike Harris).
  • Passed House with immediate effect: April 23, 2025 (roll call 106–0).
  • Transferred to Senate; referred to Health Policy Committee; reported favorably without amendment: 9/10/2025.
  • Placed on Order of Third Reading in Senate: 9/11/2025.
  • Note: HB 4207 and HB 4208 are reintroductions of HBs 4732 and 4733 (2023–24 session), which had passed the House previously but received no further action in the Senate.

References

  • Michigan: MCL 500.3701; companion HB 4208 (MCL 500.608)
  • Federal: 42 U.S.C. §300gg–91 (definition of excepted benefits)

Compiled from official sources — confirm details with the bill’s official record.

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