BILL NUMBER: SB 1198 ENROLLED
BILL TEXT
PASSED THE SENATE AUGUST 21, 2008
PASSED THE ASSEMBLY AUGUST 14, 2008
AMENDED IN ASSEMBLY JUNE 17, 2008
INTRODUCED BY Senators Kuehl and Florez
(Principal coauthor: Assembly Member Beall)
(Coauthor: Senator Wiggins)
(Coauthors: Assembly Members Hancock and Hernandez)
FEBRUARY 13, 2008
An act to add Section 1367.28 to the Health and Safety Code, and
to add Section 10123.24 to the Insurance Code, relating to health
care coverage.
LEGISLATIVE COUNSEL'S DIGEST
SB 1198, Kuehl. Health care coverage: durable medical equipment.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975
(Knox-Keene Act), provides for the licensure and regulation of health
care service plans by the Department of Managed Health Care and
makes a willful violation of that act a crime. Existing law also
provides for the regulation of health insurers by the Department of
Insurance. Under existing law, health care service plans and health
insurers are required to offer specified types of coverage as part of
their group plan contracts or group policies.
This bill would require a health care service plan and a health
insurer to offer coverage for durable medical equipment, as defined,
as part of their group plan contracts or group policies.
Because the bill would specify additional requirements under the
Knox-Keene Act, the willful violation of which would be a crime, it
would impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1367.28 is added to the Health and Safety Code,
to read:
1367.28. (a) Every health care service plan, except a specialized
health care service plan, that covers hospital, medical, or surgical
expenses on a group basis that is issued, amended, received, or
delivered on or after January 1, 2009, shall offer coverage for
durable medical equipment (DME) and services under the terms and
conditions that may be agreed upon between the group subscriber and
the plan. Every plan shall communicate the availability of that
coverage to all group contractholders and to all prospective group
contractholders with whom they are negotiating. Any coverage for DME
shall provide for coverage when the equipment, including original and
replacement equipment, is prescribed by a physician and surgeon or
doctor of podiatric medicine acting within the scope of his or her
license, or is ordered by a licensed health care provider acting
within the scope of his or her license. Every plan shall have the
right to conduct a utilization review to determine medical necessity
prior to authorizing these services.
(b) The amount of the benefit for DME and services shall be no
less than the greatest annual and lifetime benefit maximums
applicable to a basic health care service required to be provided
under Section 1367. If the contract does not include any annual or
lifetime benefit maximums applicable to basic health care services,
the amount of the benefit for DME and services shall not be subject
to an annual or lifetime maximum benefit level. Any copayment,
coinsurance, deductible, and maximum out-of-pocket amount applied to
the benefit for DME and services shall be no more than the most
common amounts applied to a basic health care service required to be
provided under Section 1367.
(c) "Durable medical equipment" consists of equipment that is used
for the treatment of a medical condition or injury or to preserve
the patient's functioning and that is designed for repeated use and
includes, but is not limited to, manual and motorized wheelchairs,
scooters, oxygen equipment, crutches, walkers, electric beds, shower
and bath seats, and mechanical patient lifts.
SEC. 2. Section 10123.24 is added to the Insurance Code, to read:
10123.24. (a) On and after January 1, 2009, every insurer issuing
group health insurance shall offer coverage for durable medical
equipment (DME) and services under the terms and conditions that may
be agreed upon between the group policyholder and the insurer. Every
insurer shall communicate the availability of that coverage to all
group policyholders and to all prospective group policyholders with
whom they are negotiating. Any coverage for DME shall provide for
coverage when the equipment, including original and replacement
equipment, is prescribed by a physician and surgeon or doctor of
podiatric medicine acting within the scope of his or her license, or
is ordered by a licensed health care provider acting within the scope
of his or her license. Every insurer shall have the right to conduct
a utilization review to determine medical necessity prior to
authorizing these services.
(b) The amount of the benefit for DME and services shall be no
less than the greatest annual and lifetime benefit maximums
applicable to a benefit in the policy. If the policy does not include
any annual or lifetime benefit maximums applicable to basic health
care services, the amount of the benefit for DME and services shall
not be subject to an annual or lifetime maximum benefit level. Any
copayment, coinsurance, deductible, and maximum out-of-pocket amount
applied to the benefit for DME and services shall be no more than the
most common amounts contained in the policy.
(c) "Durable medical equipment" consists of equipment that is used
for the treatment of a medical condition or injury or to preserve
the patient's functioning and that is designed for repeated use and
includes, but is not limited to, manual and motorized wheelchairs,
scooters, oxygen equipment, crutches, walkers, electric beds, shower
and bath seats, and mechanical patient lifts.
(d) This section shall not apply to Medicare supplement,
short-term limited duration health insurance, vision-only,
dental-only, or CHAMPUS supplement insurance, or to hospital
indemnity, hospital-only, accident-only, or specified disease
insurance that does not pay benefits on a fixed benefit, cash payment
only basis.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.