BILL NUMBER: AB 214	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 23, 2009

INTRODUCED BY   Assembly Member Chesbro

                        FEBRUARY 3, 2009

   An act to add Section 1367.27 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


   AB 214, as amended, Chesbro. 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 provide coverage for durable medical equipment, as
defined, as part of their plan contracts or health insurance
policies.
   Because this 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.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1367.27 is added to the Health and Safety Code,
to read:
   1367.27.  (a) Every health care service plan, except a specialized
health care service plan, that covers hospital, medical, or surgical
expenses on a group or individual basis that is issued, amended,
received, or delivered on or after January 1, 2010, shall provide
coverage for durable medical equipment (DME) and services under the
terms and conditions that may be agreed upon between the subscriber
and the plan. Every plan shall communicate the availability of that
coverage to all group or individual contractholders and to all
prospective group or individual contractholders with whom they are
negotiating. Coverage for DME shall provide for coverage when the
equipment, including original and replacement devices, 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 annual and lifetime benefit maximums applicable to the
basic health care services 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 the basic health care services 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, 2010, every insurer issuing
group or individual health insurance shall provide coverage for
durable medical equipment (DME) and services under the terms and
conditions that may be agreed upon between the policyholder and the
insurer. Every insurer shall communicate the availability of that
coverage to all group or individual policyholders and to all
prospective group or individual policyholders with whom they are
negotiating. Coverage for DME shall provide for coverage when the
equipment, including original and replacement devices, 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 annual and lifetime benefit maximums applicable to all
benefits in the policy. 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.  
   (d) This section shall not apply to specialized health insurance,
Medicare supplement, short term limited duration health insurance,
CHAMPUS supplement insurance, TRICARE supplement, or to hospital
indemnity, accident only, or specified disease insurance. 
  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.