BILL NUMBER: AB 2244 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 20, 2010
AMENDED IN SENATE JULY 1, 2010
AMENDED IN ASSEMBLY APRIL 27, 2010
AMENDED IN ASSEMBLY APRIL 5, 2010
INTRODUCED BY Assembly Member Feuer
FEBRUARY 18, 2010
An act to amend Sections 1357.06 and 1357.51 of, and to
add Article 11.7 (commencing with Section 1399.825) to Chapter 2.2
of Division 2 of , the Health and Safety Code, and to
amend Sections 10198.7 and 10708 of, and to add Chapter 9.7
(commencing with Section 10950) to Part 2 of Division 2 of ,
the Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 2244, as amended, Feuer. Health care coverage.
Existing law, the federal Patient Protection and Affordable Care
Act, on and after January 1, 2014, requires a health insurance issuer
offering health insurance coverage in the individual or group market
to accept every employer and individual in the state that applies
for that coverage, as specified, and allows premiums for coverage in
the individual or small group market to vary only by rating area,
age, tobacco use, and whether the coverage is for an individual or
family, as specified. The act also prohibits a health insurance
issuer offering group or individual health insurance coverage from
imposing any preexisting condition for children with respect to plan
years beginning on or after September 23, 2010, and for adults with
respect to plan years beginning on or after January 1, 2014.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975,
provides for the licensure and regulation of health care service
plans by the Department of Managed Health Care. Existing law provides
for the regulation of health insurers by the Department of
Insurance. Existing law authorizes a health care service plan or
health insurer to exclude an applicant from coverage for a specified
time for preexisting conditions. A willful violation of provisions
governing health care service plans is a crime.
This bill would require all health care service plans and
health insurers that offer individual health care coverage to offer
that coverage, by specified dates, to any child or adult seeking
coverage. The bill would also prohibit , by
specified dates , the exclusion or limitation of coverage
for children due to any preexisting condition ,
except as specified . The bill would further establish
and require the implementation of certain rating bands with respect
to plan contracts or health insurance policies that provide coverage
to children, as specified, require plans and insurers
offering coverage in the individual market to offer coverage for a
child subject to specified requirements. The bill would prescribe its
limits on the rates that may be imposed for coverage of a child
depending on, among other things, whether the child applies for
coverage during an open enrollment period, as defined, or is a late
enrollee, as defined, and would, effective January 1, 2014,
require plans and insurers to apply standard risk rates to
both adult and child coverage , except as specified
. The bill would prohibit a plan or carrier that does not
or ceases to write new plan contracts or policies for children from
offering new individual plan contracts or policies in this state for
5 years. The bill would authorize the Department of Managed
Health Care and the Department of Insurance to adopt
emergency regulations issue guidance for
purposes of implementing these provisions.
By imposing new requirements on health care service plans, the
willful violation of which would be a crime, this bill 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 1357.06 of the
Health and Safety Code is amended to read:
1357.06. (a) (1) Preexisting condition
provisions of a plan contract shall not exclude coverage for a period
beyond six months following the individual's effective date of
coverage and may only relate to conditions for which medical advice,
diagnosis, care, or treatment, including prescription drugs, was
recommended or received from a licensed health practitioner during
the six months immediately preceding the effective date of coverage.
(2) Notwithstanding paragraph (1), a plan contract offered to a
small employer shall not impose any preexisting condition provision
upon any child under 19 years of age.
(b) A plan that does not utilize a preexisting condition provision
may impose a waiting or affiliation period, not to exceed 60 days,
before the coverage issued subject to this article shall become
effective. During the waiting or affiliation period no premiums shall
be charged to the enrollee or the subscriber.
(c) In determining whether a preexisting condition provision or a
waiting or affiliation period applies to any person, a plan shall
credit the time the person was covered under creditable coverage,
provided the person becomes eligible for coverage under the
succeeding plan contract within 62 days of termination of prior
coverage, exclusive of any waiting or affiliation period, and applies
for coverage with the succeeding plan contract within the applicable
enrollment period. A plan shall also credit any time an eligible
employee must wait before enrolling in the plan, including any
affiliation or employer-imposed waiting or affiliation period.
However, if a person's employment has ended, the availability of
health coverage offered through employment or sponsored by an
employer has terminated, or an employer's contribution toward health
coverage has terminated, a plan shall credit the time the person was
covered under creditable coverage if the person becomes eligible for
health coverage offered through employment or sponsored by an
employer within 180 days, exclusive of any waiting or affiliation
period, and applies for coverage under the succeeding plan contract
within the applicable enrollment period.
(d) In addition to the preexisting condition exclusions authorized
by subdivision (a) and the waiting or affiliation period authorized
by subdivision (b), health plans providing coverage to a guaranteed
association may impose on employers or individuals purchasing
coverage who would not be eligible for guaranteed coverage if they
were not purchasing through the association a waiting or affiliation
period, not to exceed 60 days, before the coverage issued subject to
this article shall become effective. During the waiting or
affiliation period, no premiums shall be charged to the enrollee or
the subscriber.
(e) An individual's period of creditable coverage shall be
certified pursuant to subdivision (e) of Section 2701 of Title XXVII
of the federal Public Health Services Act (42 U.S.C. Sec. 300gg(e)).
(f) A health care service plan issuing group coverage may not
impose a preexisting condition exclusion to any of the
following: (1) To a newborn
individual, who, as of the last day of the 30-day period beginning
with the date of birth, has applied for coverage through the
employer-sponsored plan. (2) To
a child who is adopted or placed for adoption before attaining 18
years of age and who, as of the last day of the 30-day period
beginning with the date of adoption or placement for adoption, is
covered under creditable coverage and applies for coverage through
the employer-sponsored plan. This provision shall not apply if, for
63 continuous days, the child is not covered under any creditable
coverage. (3) To a
condition relating to benefits for pregnancy or maternity care.
SEC. 2. Section 1357.51 of the Health
and Safety Code is amended to read:
1357.51. (a) No plan contract that covers three or more
enrollees shall exclude coverage for any individual on the basis of a
preexisting condition provision for a period greater than six months
following the individual's effective date of coverage. Preexisting
condition provisions contained in plan contracts may relate only to
conditions for which medical advice, diagnosis, care, or treatment,
including use of prescription drugs, was recommended or received from
a licensed health practitioner during the six months immediately
preceding the effective date of coverage.
(b) No plan contract that covers one or two individuals shall
exclude coverage on the basis of a preexisting condition provision
for a period greater than 12 months following the individual's
effective date of coverage, nor shall the plan limit or exclude
coverage for a specific enrollee by type of illness, treatment,
medical condition, or accident, except for satisfaction of a
preexisting condition clause pursuant to this article. Preexisting
condition provisions contained in plan contracts may relate only to
conditions for which medical advice, diagnosis, care, or treatment,
including use of prescription drugs, was recommended or received from
a licensed health practitioner during the 12 months immediately
preceding the effective date of coverage.
(c) (1) Notwithstanding subdivision (a), a plan contract for group
coverage shall not impose any preexisting condition provision upon
any child under 19 years of age.
(2) Notwithstanding subdivision (b), a plan contract for
individual coverage that is not a grandfathered health within the
meaning of Section 1251 of the federal Patient Protection and
Affordable Care Act (Public Law 111-148) shall not impose any
preexisting condition provision upon any child under 19 years of age.
(c)
(d) A plan that does not utilize a preexisting
condition provision may impose a waiting or affiliation period not to
exceed 60 days, before the coverage issued subject to this article
shall become effective. During the waiting or affiliation period, the
plan is not required to provide health care services and no premium
shall be charged to the subscriber or enrollee.
(d)
(e) A plan that does not utilize a preexisting
condition provision in plan contracts that cover one or two
individuals may impose a contract provision excluding coverage for
waivered conditions. No plan may exclude coverage on the basis of a
waivered condition for a period greater than 12 months following the
individual's effective date of coverage. A waivered condition
provision contained in plan contracts may relate only to conditions
for which medical advice, diagnosis, care, or treatment, including
use of prescription drugs, was recommended or received from a
licensed health practitioner during the 12 months immediately
preceding the effective date of coverage.
(e)
(f) In determining whether a preexisting condition
provision, a waivered condition provision, or a waiting or
affiliation period applies to any enrollee, a plan shall credit the
time the enrollee was covered under creditable coverage, provided
that the enrollee becomes eligible for coverage under the succeeding
plan contract within 62 days of termination of prior coverage,
exclusive of any waiting or affiliation period, and applies for
coverage under the succeeding plan within the applicable enrollment
period. A plan shall also credit any time that an eligible employee
must wait before enrolling in the plan, including any postenrollment
or employer-imposed waiting or affiliation period.
However, if a person's employment has ended, the availability of
health coverage offered through employment or sponsored by an
employer has terminated, or an employer's contribution toward health
coverage has terminated, a plan shall credit the time the person was
covered under creditable coverage if the person becomes eligible for
health coverage offered through employment or sponsored by an
employer within 180 days, exclusive of any waiting or affiliation
period, and applies for coverage under the succeeding plan contract
within the applicable enrollment period.
(f)
(g) No plan shall exclude late enrollees from coverage
for more than 12 months from the date of the late enrollee's
application for coverage. No plan shall require any premium or other
periodic charge to be paid by or on behalf of a late enrollee during
the period of exclusion from coverage permitted by this subdivision.
(g)
(h) A health care service plan issuing group coverage
may not impose a preexisting condition exclusion upon the
following:
(1 A newborn individual, who, as of the last day of the 30-day
period beginning with the date of birth, has applied for coverage
through the employer-sponsored plan.
(2) A child who is adopted or placed for adoption before attaining
18 years of age and who, as of the last day of the 30-day period
beginning with the date of adoption or placement for adoption, is
covered under creditable coverage and applies for coverage through
the employer-sponsored plan. This provision shall not apply if, for
63 continuous days, the child is not covered under any creditable
coverage.
(3) A
a condition relating to benefits for pregnancy
or maternity care.
(h)
(i) An individual's period of creditable coverage shall
be certified pursuant to subsection (e) of Section 2701 of Title
XXVII of the federal Public Health Services Act (42 U.S.C. Sec. 300gg
(e)).
SECTION 1. SEC. 3. Article 11.7
(commencing with Section 1399.825) is added to Chapter 2.2 of
Division 2 of the Health and Safety Code, to read:
Article 11.7. Individual Access to Health Care Coverage
1399.825. As used in this article:
(a) (1) "Child" means any
individual under 19 years of age.
(2) "Responsible party for a child" means an adult having custody
of a child with the right to make medical decisions for, and with the
responsibility for the financial needs of, the child.
(b) "Individual" means any individual 19 years of age or older.
(c) "In force business" means an existing health care service plan
contract issued by a health care service plan to an individual.
(d) "New business" means a health care service plan contract
issued to an individual that is not the plan's in force business.
(e) "Preexisting condition provision" means a contract provision
that excludes coverage for charges or expenses incurred during a
specified period following the enrollee's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
(f) "Rating period" means the period for which premium rates
established by a plan are in effect and shall be no less than 12
months.
(g) "Risk adjusted individual risk rate" means the rate determined
for an eligible individual or child in a particular risk category
after applying the risk adjustment factor.
(h) "Risk adjustment factor" means the percentage adjustment to be
applied equally to each standard risk rate for a particular child,
based upon any expected deviations from standard cost of services.
Between January 1, 2011, and December 31, 2011, inclusive, this
factor may not be more than 120 percent or less than 80 percent.
Between January 1, 2012, and December 31, 2013, inclusive, this
factor may not be more than 110 percent or less than 90 percent.
Effective January 1, 2014, the standard risk rate shall apply to all
contracts sold to individuals or for children.
(i) "Risk category" means the following characteristics of an
eligible child: age, geographic region, and family composition of the
individual, plus the health care service plan selected by the
individual.
(1) Until January 1, 2014, no more than the following age
categories may be used in determining premium rates:
(A) Under age 1.
(B) Age 1-19.
(2) The rate shall not vary by more than 2 to 1 for children.
(3) Individual health care service plans shall base rates for
individuals and children using no more than the following family size
categories:
(A) Single.
(B) More than one child and no adults.
(C) Married couple or registered domestic partners.
(D) One adult and one child.
(E) One adult and children.
(F) Married couple and child or children, or registered domestic
partners and child or children.
(4) In determining rates for individuals and children, a plan that
operates statewide shall use the geographic regions specified in
Section 1357.
(j) Nothing in this section shall be construed to require a plan
to establish a new service area or to offer health coverage on a
statewide basis, outside of the plan's existing service area.
1399.826. (a) (1) Effective January 1, 2011, every health care
service plan offering plan contracts for children shall offer
coverage to the responsible party for any child that seeks coverage.
(2) Effective January 1, 2014, every health care service plan
offering plan contracts to individuals shall offer coverage to any
individual who seeks coverage.
(b) (1) Effective January 1, 2011, notwithstanding any other
provision of state law or regulation, every health care service plan
offering contracts for children shall not exclude or limit coverage
due to any preexisting condition.
(2) Effective January 1, 2014, notwithstanding any other provision
of state law or regulation, every health care service plan offering
contracts for individuals shall not exclude or limit coverage due to
any preexisting condition.
(c) This article shall not apply to coverage to which an employer
makes any contribution.
(d) Every health care service plan offering plan contracts to
individuals shall, in addition to complying with the provisions of
this chapter and the rules adopted thereunder, comply with the
provisions of this article.
(b) "Individual grandfathered plan coverage" means health care
coverage in which an individual was enrolled on March 23, 2010,
consistent with Section 1251 of PPACA and any rules or regulations
adopted pursuant to that law.
(c) "Initial open enrollment period" means the open enrollment
period beginning on January 1, 2011, and ending 60 days thereafter.
(d) "Late enrollee" means a child without coverage who did not
enroll in a health care service plan contract during an open
enrollment period because of any of the following:
(1) The child lost dependent coverage due to termination or change
in employment status of the child or the person through whom the
child was covered; cessation of an employer's contribution toward an
employee or dependent's coverage; death of the person through whom
the child was covered as a dependent; legal separation; divorce; loss
of coverage under the Healthy Families Program, the Access for
Infants and Mothers Program, or the Medi-Cal program; or adoption of
the child.
(2) The child became a resident of California during a month that
was not the child's birth month.
(3) The child is born as a resident of California and did not
enroll in the month of birth.
(4) The child is mandated to be covered pursuant to a valid state
or federal court order.
(e) "Open enrollment period" means the annual open enrollment
period, subsequent to the initial open enrollment period, applicable
to each individual child that is the month of the child's birth date.
(f) "PPACA" means the federal Patient Protection and Affordable
Care Act (Public Law 111-148), as amended by the Health Care and
Education Reconciliation Act of 2010 (Public Law 111-152), and any
subsequent rules or regulations issued pursuant to that law.
(g) "Preexisting condition exclusion" means, with respect to
coverage, a limitation or exclusion of benefits relating to a
condition based on the fact that the condition was present before the
date of enrollment of the coverage, whether or not any medical
advice, diagnosis, care, or treatment was recommended or received
before that date.
(h) "Responsible party for a child" means an adult having custody
of the child or with responsibility for the financial needs of the
child, including the responsibility to provide health care coverage.
(i) "Standard risk rate" means the lowest rate that can be offered
for a child with the same benefit plan, effective date, age,
geographic region, and family status.
1399.826. (a) (1) During each open enrollment period, every
health care service plan offering plan contracts in the individual
market, other than individual grandfathered plan coverage, shall
offer to the responsible party for a child coverage for the child
that does not exclude or limit coverage due to any preexisting
condition of the child.
(b) A health care service plan offering coverage in the individual
market shall not reject an application for a health care service
plan contract from a child or filed on behalf of a child by the
responsible party during an open enrollment period or from a late
enrollee during a period no longer than 63 days from the qualifying
event listed in subdivision (d) of Section 1399.825.
(c) Except to the extent permitted by federal law, rules,
regulations, or guidance issued by the relevant federal agency, a
health care service plan shall not condition the issuance or offering
of individual coverage on any of the following factors:
(1) Health status.
(2) Medical condition, including physical and mental illnesses.
(3) Claims experience.
(4) Receipt of health care.
(5) Medical history.
(6) Genetic information.
(7) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(8) Disability.
(9) Any other health status-related factor as determined by
department.
This subdivision shall not apply to a contract providing
individual grandfathered plan coverage.
(d) When a responsible party for a child submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs earlier, within the first
15 days of the month, coverage under the plan contract shall become
effective no later than the first day of the following month. When
that payment is neither delivered nor postmarked until after the 15th
day of the month, coverage shall become effective no later than the
first day of the second month following delivery or postmark of the
payment.
(e) A health care service plan offering coverage in the individual
market shall not reject the request of a responsible party for a
child to include that child as a dependent on an existing health care
service plan contract that includes dependent coverage during an
open enrollment period.
(f) Nothing in this article shall be construed to prohibit a
health care service plan offering coverage in the individual market
from establishing rules for eligibility for coverage and offering
coverage pursuant to those rules for children and individuals based
on factors otherwise authorized under federal and state law for
health plan contracts in addition to those offered on a guaranteed
issue basis during an open enrollment period to children or late
enrollees pursuant to this article. However, a health care service
plan, other than a plan providing individual grandfathered plan
coverage, shall not impose a preexisting condition provision on
coverage, including dependent coverage, offered to a child.
(g) Nothing in this article shall be construed to require a plan
to establish a new service area or to offer health coverage on a
statewide basis, outside of the plan's existing service area.
(h) Nothing in this article shall be construed to prevent a health
care service plan from offering coverage to a family member of an
enrollee in grandfathered health plan coverage consistent with
Section 1251 of PPACA.
1399.827. This article shall not apply to health care service
plan contracts for coverage of Medicare services pursuant to
contracts with the United States government, Medicare supplement
contracts, Medi-Cal contracts with the State Department of Health
Care Services, plan contracts offered under the Healthy Families
Program, long-term care coverage, or specialized health care service
plan contracts.
1399.828. (a) Upon the effective date of this article, a health
care service plan shall fairly and affirmatively offer, market, and
sell all of the plan's health care service plan contracts that are
offered and sold to the responsible party for a child. Effective
January 1, 2014, a health care service plan shall fairly and
affirmatively offer, market, and sell all of the plan's health care
service plan contracts that are sold to individuals.
(b) Effective January 1, 2011, a health care service plan shall
not reject an application from the responsible party for a child for
a health care service plan contract. Effective January 1, 2014, a
health care service plan shall not reject an application from an
individual for a health care service plan contract.
1399.828. (a) Upon the effective date of this
article, a health care service plan shall fairly and affirmatively
offer, market, and sell all of the plan's health care service plan
contracts that are offered and sold to a child or the responsible
party for a child in each service area in which the plan provides or
arranges for the provision of health care services during any open
enrollment period, to late enrollees, and during any other period in
which state or federal law, rules, regulations, or guidance expressly
provide that a health care service plan shall not condition offer or
acceptance of coverage on any preexisting condition.
(c)
(b) No health care service plan or solicitor shall,
directly or indirectly, engage in the following activities:
(1) Encourage or direct an individual a
child or responsible party for a child to refrain from filing
an application for coverage with a plan because of the health status,
claims experience, industry, occupation, or geographic location,
provided that the location is within the plan's approved service
area, of the individual or child.
(2) Encourage or direct individuals or children
a child or responsible party for a child to seek coverage
from another plan because of the health status, claims experience,
industry, occupation, or geographic location, provided that the
location is within the plan's approved service area, of the
individual or child.
(d)
(c) A health care service plan shall not, directly or
indirectly, enter into any contract, agreement, or arrangement with a
solicitor that provides for or results in the compensation paid to a
solicitor for the sale of a health care service plan contract to be
varied because of the health status, claims experience, industry,
occupation, or geographic location of the individual or
child. This subdivision does not apply to a compensation
arrangement that provides compensation to a solicitor on the basis of
percentage of premium, provided that the percentage shall not vary
because of the health status, claims experience, industry,
occupation, or geographic area of the individual or
child.
(e) Effective January 1, 2011, a health care service plan contract
that covers a child shall not establish rules for eligibility,
including continued eligibility, of an individual, or dependent of an
individual, to enroll under the terms of the plan based on any of
the following health status-related factors:
(1) Health status.
(2) Medical condition, including physical and mental illnesses.
(3) Claims experience.
(4) Receipt of health care.
(5) Medical history.
(6) Genetic information.
(7) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(8) Disability.
(9) Any other health status-related factor determined appropriate
by department.
1399.829. (a) After an individual or the responsible party for a
child submits a completed application form for a plan contract, the
health care service plan shall, within 30 days, notify the individual
or responsible party for a child of actual premium charges for that
plan contract established in accordance with Section 1399.836. The
individual or responsible party for a child shall have 30 days in
which to exercise the right to
buy coverage at the quoted premium charges.
(b) When an individual or the responsible party for a child
submits a premium payment, based on the quoted premium charges, and
that payment is delivered or postmarked, whichever occurs earlier,
within the first 15 days of the month, coverage under the plan
contract shall become effective no later than the first day of the
following month. If that payment is delivered or postmarked after the
15th day of a month, coverage shall become effective no later than
the first day of the second month following delivery or postmark of
the payment.
(c) During the first 60 days after the effective date of the plan
contract, the individual or responsible party for a child shall have
the option of changing coverage to a different plan contract offered
by the same health care service plan. If an individual or the
responsible party for a child notifies the plan of the change within
the first 15 days of a month, coverage under the new plan contract
shall become effective no later than the first day of the following
month. If an individual or the responsible party for a child notifies
the plan of the change after the 15th day of a month, coverage under
the new plan contract shall become effective no later than the first
day of the second month following notification.
1399.830. (a) Effective January 1, 2011, a health care service
plan may not exclude any child who would otherwise be entitled to
health care services on the basis of an actual or expected health
condition of that child. No health care service plan contract may
limit or exclude coverage for a child by type of illness, treatment,
medical condition, or accident.
(b) Effective January 1, 2014, a health care service plan may not
exclude any individual who would otherwise be entitled to health care
services on the basis of an actual or expected health condition of
that individual. No health care service plan contract may limit or
exclude coverage for a child by type of illness, treatment, medical
condition, or accident.
1399.829. (a) A health care service plan may use the following
characteristics of an eligible child for purposes of establishing the
rate of the plan contract for that child, where consistent with
federal regulations under PPACA: age, geographic region, and family
composition, plus the health care service plan contract selected by
the child or the responsible party for the child.
(b) From the effective date of this article to December 31, 2013,
inclusive, rates for a child applying for coverage shall be subject
to the following limitations:
(1) During any open enrollment period or for late enrollees, the
rate for any child due to health status shall not be more than two
times the standard risk rate for a child.
(2) The rate for a child shall be subject to a 20-percent
surcharge above the highest allowable rate on a child applying for
coverage who is not a late enrollee and who failed to maintain
coverage with any health care service plan or health insurer for the
90-day period prior to the date of the child's application. The
surcharge shall apply for the 12-month period following the effective
date of the child's coverage.
(3) If expressly permitted under PPACA and any rules, regulations,
or guidance issued pursuant to that act, a health care service plan
may rate a child based on health status during any period other than
an open enrollment period if the child is not a late enrollee.
(4) If expressly permitted under PPACA and any rules, regulations,
or guidance issued pursuant to that act, a health care service plan
may condition an offer or acceptance of coverage on any preexisting
condition or other health status-related factor for a period other
than an open enrollment period and for a child who is not a late
enrollee.
(c) For any individual health care service plan contract issued,
sold, or renewed prior to December 31, 2013, the health plan shall
provide to a child or responsible party for a child a notice that
states the following:
"Please consider your options carefully before failing to maintain
or renew coverage for a child for whom you are responsible. If you
attempt to obtain new individual coverage for that child, the premium
for the same coverage may be higher than the premium you pay now."
(d) A child who applied for coverage between September 23, 2010,
and the end of the initial open enrollment period shall be deemed to
have maintained coverage during that period.
(e) Effective January 1, 2014, except for individual grandfathered
health plan coverage, the rate for any child shall be identical to
the standard risk rate.
(f) Health care service plans may require documentation from
applicants relating to their coverage history.
1399.832. No health care service plan shall be required to offer
a health care service plan contract or accept applications for the
contract pursuant to this article in the case of any of the
following:
(a) To an individual or child, if the individual or child who is
(a) To a child, if the child who is
to be covered by the plan contract does not work or reside
within the plan's approved service areas.
(b) (1) Within a specific service area or portion of a service
area, if the plan reasonably anticipates and demonstrates to the
satisfaction of the director that it will not have sufficient health
care delivery resources to ensure that health care services will be
available and accessible to the individual or
child because of its obligations to existing enrollees.
(2) A health care service plan that cannot offer a health care
service plan contract to individuals or children because it is
lacking in sufficient health care delivery resources within a service
area or a portion of a service area may not offer a contract in the
area in which the plan is not offering coverage to individuals to new
employer groups until the plan notifies the director that it has the
ability to deliver services to individuals, and certifies to the
director that from the date of the notice it will enroll all
individuals requesting coverage in that area from the plan.
(3) Nothing in this article shall be construed to limit the
director's authority to develop and implement a plan of
rehabilitation for a health care service plan whose financial
viability or organizational and administrative capacity has become
impaired.
1399.833. The director may require a health care service plan to
discontinue the offering of contracts or acceptance of applications
from any individual or child or responsible party for a child
upon a determination by the director that the plan does not
have sufficient financial viability or organizational and
administrative capacity to ensure the delivery of health care
services to its enrollees. In determining whether the conditions of
this section have been met, the director shall consider, but not be
limited to, the plan's compliance with the requirements of Section
1367, Article 6 (commencing with Section 1375.1), and the rules
adopted under those provisions.
1399.834. All health care service plan contracts offered to a
child or individual shall be renewable at the option of the enrollee
or responsible party for a child except:
(a) For nonpayment of the required premiums by the enrollee or
responsible party for a child.
(b) For fraud or misrepresentation by the individuals or their
representatives.
(c) When the health care service plan ceases to provide or arrange
for the provision of health care services for new individual health
care service plan contracts in this state; provided, however, that
the following conditions are satisfied:
(1) Notice of the decision to cease new or existing individual
health care service plan contracts in this state is provided to the
director and to the contractholder at least 360 days prior to the
discontinuation of the coverage.
(2) Individual health care service plan contracts subject to this
article shall not be canceled for 360 days after the date of the
notice required under paragraph (1) and for that business of a plan
which remains in force, any plan that ceases to offer for sale new
individual health care service plan contracts shall continue to be
governed by this article with respect to business conducted under
this article.
(3) Except as authorized under Section 1399.833, a plan that
ceases to write new individual business in this state after the
effective date of this article shall be prohibited from offering for
sale new individual health care service plan contracts in this state
for a period of five years from the date of notice to the director.
(d) When the health care service plan withdraws a health care
service plan contract from the individual market; provided, the plan
notifies all affected contractholders and the director at least 180
days prior to the discontinuation of those contracts, and the plan
makes available to the individual all plan contracts that it makes
available to new individual business; and provided, that the premium
for the new plan contract complies with the renewal increase
requirements set forth in Section 1399.836.
1399.836. Effective January 1, 2011, premiums for contracts
offered or delivered by health care service plans on or after the
effective date of this article for children shall be subject to the
following requirements:
(a) The premium for new business shall be determined for an
eligible child in a particular risk category after applying a risk
adjustment factor to the plan's standard risk rates. Between January
1, 2011, and December 31, 2011, inclusive, the risk adjusted risk
rate may not be more than 120 percent or less than 80 percent of the
plan's applicable standard risk rate. Between January 1, 2012, and
December 31, 2013, inclusive, this factor may not be more than 110
percent or less than 90 percent. The standard risk rates applied to a
child for new business shall be in effect for no less than 12
months.
(b) (1) The premium for in force business shall be determined for
an eligible child in a particular risk category after applying a risk
adjustment factor to the plan's standard individual risk rates.
Between January 1, 2011, and December 31, 2011, inclusive, the risk
adjusted individual risk rates may not be more than 120 percent or
less than 80 percent of the plan's applicable standard risk rate.
Between January 1, 2012, and December 31, 2013, inclusive, this
factor may not be more than 110 percent or less than 90 percent. The
factor effective January 1, 2011, shall apply to in force business at
the earlier of either the time of renewal or January 1, 2012. The
risk adjustment factor applied to a child may not increase by more
than 10 percentage points from the risk adjustment factor applied in
the prior rating period. The risk adjustment factor for a child may
not be modified more frequently than once every 12 months.
(2) The standard risk rates shall be in effect for no less than 12
months.
(3) For a contract that a plan has discontinued offering, the risk
adjustment factor applied to the standard risk rates for the first
rating period of the new contract that the responsible party for the
child elects to purchase shall be no greater than the risk adjustment
factor applied in the prior rating period to the discontinued
contract. However, between January 1, 2011, and December 31, 2011,
inclusive, the risk adjusted individual risk rate may not be more
than 120 percent or less than 80 percent of the plan's applicable
standard risk rate. Between January 1, 2012, and December 31, 2013,
inclusive, this factor may not be more than 110 percent or less than
90 percent. The factor effective January 1, 2011, shall apply to in
force business at the earlier of either the time of renewal or
January 1, 2012. The risk adjustment factor for a child may not be
modified more frequently than once every 12 months.
1399.837. Health care service plans shall apply standard risk
rates consistently with respect to all children.
1399.838. In connection with the offering for sale of any plan
contract for children, each plan shall make a reasonable disclosure,
as part of its solicitation and sales materials, of the following:
(a) The extent to which premium rates for a specific child are
established or adjusted in part based upon the actual or expected
variation in service costs or actual or expected variation in health
condition of the child.
(b) The provisions concerning the plan's right to change premium
rates and the factors, other than provision of services experience,
that affect changes in premium rates.
(c) Provisions relating to the guaranteed issue and renewal of
contracts.
(d) Provisions relating to the child's right to apply for any
contract written, issued, or administered by the plan at the time of
application for a new health care service plan contract, or at the
time of renewal of a health care service plan contract.
(e) The availability, upon request, of a listing of all the plan's
contracts and benefit plan designs offered for children, including
the rates for each contract.
(f) At the time it offers a contract to the responsible party for
a child, each plan shall provide the responsible party with a
statement of all of its plan contracts offered to children, including
the rates for each plan contract, in the service area in which the
individuals who are to be covered by the plan contract reside. For
purposes of this subdivision, plans that are affiliated plans or that
are eligible to file a consolidated income tax return shall be
treated as one health plan.
(g) Each health care service plan shall do all of the following:
(1) Prepare a brochure that summarizes all of its plan contracts
offered to children and to make this summary available to any
responsible party for a child and to solicitors upon request. The
summary shall include for each contract information on benefits
provided, a generic description of the manner in which services are
provided, such as how access to providers is limited, benefit
limitations, required copayments and deductibles, standard risk
rates, and a telephone number that can be called for more detailed
benefit information. Plans are required to keep the information
contained in the brochure accurate and up to date and, upon updating
the brochure, send copies to solicitors and solicitor firms with whom
the plan contracts to solicit enrollments or subscriptions.
(2) For each contract, prepare a more detailed evidence of
coverage and make it available to responsible parties, solicitors,
and solicitor firms upon request. The evidence of coverage shall
contain all information that a prudent buyer would need to be aware
of in making contract selections.
(3) Provide to responsible parties and solicitors, upon request,
for any given child the standard risk rates. When requesting this
information, responsible parties, solicitors, and solicitor firms
shall provide the plan with the information the plan needs to
determine the child's risk adjusted risk rate.
(4) Provide copies of the current summary brochure to all
solicitors and solicitor firms contracting with the plan to solicit
enrollments or subscriptions from responsible parties for children.
For purposes of this subdivision, plans that are affiliated plans
or that are eligible to file a consolidated income tax return shall
be treated as one health plan.
(h) Every solicitor or solicitor firm contracting with one or more
plans to solicit enrollments or subscriptions from responsible
parties for children shall do all of the following:
(1) When providing information on contracts to a responsible party
for a child or children but making no specific recommendations on
particular plan contracts:
(A) Advise the responsible party of the plan's obligation to sell
to any responsible party any plan contract it offers for children and
provide them, upon request, with the actual rates that would be
charged for that child for a given contract.
(B) Notify the responsible party that the solicitor or solicitor
firm will procure rate and benefit information for the responsible
party for the child on any plan contract offered by a plan whose
contract the solicitor sells.
(C) Notify the responsible party that upon request the solicitor
or solicitor firm will provide the responsible party with the summary
brochure required under this paragraph for any plan contract offered
by a plan with whom the solicitor or solicitor firm has contracted
to solicit enrollments or subscriptions.
(2) When recommending a particular benefit plan design or designs,
advise the responsible party that, upon request, the agent will
provide the responsible party with the brochure required by paragraph
(1) containing the benefit plan design or designs being recommended
by the agent or broker.
(3) Prior to filing an application for a responsible party for a
child for a particular contract:
(A) For each of the plan contracts offered by the plan whose
contract the solicitor or solicitor firm is offering, provide the
responsible party with the benefit summary required in paragraph (1)
and the standard risk rates for that particular child.
(B) Notify the responsible party that, upon request, the solicitor
or solicitor firm will provide the responsible party with an
evidence of coverage brochure for each contract the plan offers.
(C) Notify the responsible party for a child that, from January 1,
2011, to December 31, 2011, inclusive, actual rates may be 20
percent higher or lower than the standard risk rates, and from
January 1, 2012, to December 31, 2013, inclusive, actual rates may be
10 percent higher or lower than the standard risk rates, depending
on how the plan assesses the risk of the child.
(D) Notify the responsible party that, upon request, the solicitor
or solicitor firm will submit information to the plan to ascertain
the child's risk adjusted risk rate for any contract the plan offers.
(E) Obtain a signed statement from the responsible party
acknowledging that the responsible party has received the disclosures
required by this section.
1399.839. (a) At least 30 business days prior to renewing or
amending a plan contract subject to this article that will be in
force on the operative date of this article, a plan shall file a
notice of material modification with the director in accordance with
the provisions of Section 1352. The notice of material modification
shall include a statement certifying that the plan is in compliance
with subdivision (i) of Section 1399.825 and Section 1399.836. The
certified statement shall set forth the standard risk rate for each
risk category and the highest and lowest risk adjustment factors that
will be used in setting the rates at which the contract will be
renewed or amended. Any action by the director, as permitted under
Section 1352, to disapprove, suspend, or postpone the plan's use of a
plan contract shall be in writing, specifying the reasons that the
plan contract is not in compliance with the requirements of this
chapter.
(b) At least 30 business days prior to offering a plan contract
subject to this article, all plans shall file a notice of material
modification with the director in accordance with the provisions of
Section 1352. The notice of material modification shall include a
statement certifying that the plan is in compliance with subdivision
(i) of Section 1399.825 and Section 1399.836. The certified statement
shall set forth the standard risk rate for each risk category and
the highest and lowest risk adjustment factors that will be used in
setting the rates at which the contract will be offered. Plans that
will be offering to a responsible party for a child contracts
approved by the director prior to the effective date of this article
shall file a notice of material modification in accordance with this
subdivision. Any action by the director, as permitted under Section
1352, to disapprove, suspend, or postpone the plan's use of a plan
contract shall be in writing, specifying the reasons that the plan
contract is not in compliance with the requirements of this chapter.
(c) Prior to making any changes in the risk categories, risk
adjustment factors, or standard risk rates filed with the director
pursuant to subdivision (a) or (b), the plan shall file, as an
amendment, a statement setting forth the changes and certifying that
the plan is in compliance with subdivision (i) of Section 1399.825
and Section 1399.836. A plan may commence offering plan contracts
utilizing the changed risk categories set forth in the certified
statement on the 45th day from the date of the filing, or at an
earlier time determined by the director, unless the director
disapproves the amendment by written notice, stating the reasons
therefor. If only the standard risk rate is being changed, and not
the risk categories or risk adjustment factors, a plan may commence
offering plan contracts utilizing the changed standard risk rate upon
the 31st day after filing the certified statement unless the
director disapproves the amendment by written notice.
(d) Periodic changes to the standard risk rate that a plan
proposes to implement over the course of up to 12 consecutive months
may be filed in conjunction with the certified statement filed under
subdivision (a), (b), or (c).
(e) Each plan shall maintain at its principal place of business
all of the information required to be filed with the director
pursuant to this section.
(f) Each plan shall make available to the director, on request,
the risk adjustment factor used in determining the rate for any
particular child.
(g) Nothing in this section shall be construed to limit the
director's authority to enforce the rating practices set forth in
this article.
1399.840. The director may issue regulations that are necessary
to carry out the purposes of this article. Prior to the public
comment period required by regulations under the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code), the director shall
provide the Insurance Commissioner with a copy of the proposed
regulations. The Insurance Commissioner shall have 30 days to notify
the director in writing of any comments on the regulations. The
Insurance Commissioner's comments shall be included in the public
notice issued on the regulations. Any rules and regulations adopted
pursuant to this article may be adopted as emergency regulations in
accordance with the Administrative Procedure Act. Until December 31,
2015, the adoption of these regulations shall be deemed an emergency
and necessary for the immediate preservation of the public peace,
health and safety, or general welfare. Any regulations adopted prior
to December 31, 2015, in order to remain in effect after December 31,
2016, shall be readopted as nonemergency regulations in accordance
with the Administrative Procedure Act prior to December 31, 2016.
1399.834. (a) All health care service plan contracts offered to a
child or on behalf of a child to a responsible party for a child
shall conform to the requirements of Sections 1366.3, 1365, and
1373.6 and shall be renewable at the option of the enrollee or
responsible party for a child on behalf of the
enrollee except as permitted to be canceled,
rescinded, or not renewed pursuant to Section 1365.
(b) Any plan that ceases to offer for sale new individual health
care service plan contracts pursuant to Section 1365 shall continue
to be governed by this article with respect to business conducted
under this article.
(c) Except as authorized under Section 1399.833, a plan that, as
of the effective date of this article, does not write new health care
service plan contracts for children in this state or that, after the
effective date of this article, ceases to write new health care
service plan contracts for children in this state shall be prohibited
from offering for sale new individual health care service plan
contracts in this state for a period of five years from the date of
notice to the director.
1399.835. On or before July 1, 2011, the director may issue
guidance to health plans regarding compliance with this article and
that guidance shall not be subject to the Administrative Procedure
Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code. The guidance shall only
be effective until the director and the Insurance Commissioner adopt
joint regulations pursuant to the Administrative Procedure Act.
SEC. 4. Section 10198.7 of the
Insurance Code is amended to read:
10198.7. (a) No health benefit plan that covers three or more
persons and that is issued, renewed, or written by any insurer,
nonprofit hospital service plan, self-insured employee welfare
benefit plan, fraternal benefits society, or any other entity shall
exclude coverage for any individual on the basis of a preexisting
condition provision for a period greater than six months following
the individual's effective date of coverage, nor shall limit or
exclude coverage for a specific insured person by type of illness,
treatment, medical condition, or accident except for satisfaction of
a preexisting clause pursuant to this article. Preexisting condition
provisions contained in health benefit plans may relate only to
conditions for which medical advice, diagnosis, care, or treatment,
including use of prescription drugs, was recommended or received from
a licensed health practitioner during the six months immediately
preceding the effective date of coverage.
(b) No health benefit plan that covers one or two individuals and
that is issued, renewed, or written by any insurer, self-insured
employee welfare benefit plan, fraternal benefits society, or any
other entity shall exclude coverage on the basis of a preexisting
condition provision for a period greater than 12 months following the
individual's effective date of coverage, nor shall limit or exclude
coverage for a specific insured person by type of illness, treatment,
medical condition, or accident, except for satisfaction of a
preexisting condition clause pursuant to this article. Preexisting
condition provisions contained in health benefit plans may relate
only to conditions for which medical advice, diagnosis, care, or
treatment, including use of prescription drugs, was recommended or
received from a licensed health practitioner during the 12 months
immediately preceding the effective date of coverage.
(c) (1) Notwithstanding subdivision (a), a health benefit plan for
group coverage shall not impose any preexisting condition provision
upon any child under 19 years of age.
(2) Notwithstanding subdivision (b), a health benefit plan for
individual coverage that is a grandfathered plan within the meaning
of Section 1251 of the federal Patient Protection and Affordable Care
Act (Public Law 111-148) shall not impose any preexisting condition
provision upon any child under 19 years of age.
(c)
(d) A carrier that does not utilize a preexisting
condition provision may impose a waiting or affiliation period not to
exceed 60 days, before the coverage issued subject to this article
shall become effective. During the waiting or affiliation period, the
carrier is not required to provide health care services and no
premium shall be charged to the subscriber or enrollee.
(d)
(e) A carrier that does not utilize a preexisting
condition provision in health plans that cover one or two individuals
may impose a contract provision excluding coverage for waivered
conditions. No carrier may exclude coverage on the basis of a
waivered condition for a period greater than 12 months following the
individual's effective date of coverage. A waivered condition
provision contained in health benefit plans may relate only to
conditions for which medical advice, diagnosis, care, or treatment,
including use of prescription drugs, was recommended or received from
a licensed health practitioner during the 12 months immediately
preceding the effective date of coverage.
(e)
(f) In determining whether a preexisting condition
provision, a waivered condition provision, or a waiting or
affiliation period applies to any person, all health benefit plans
shall credit the time the person was covered under creditable
coverage, provided the person becomes eligible for coverage under the
succeeding health benefit plan within 62 days of termination of
prior coverage, exclusive of any waiting or affiliation period, and
applies for coverage under the succeeding plan within the applicable
enrollment period. A health benefit plan shall also credit any time
an eligible employee must wait before enrolling in the health benefit
plan, including any affiliation or employer-imposed waiting period.
However, if a person's employment has ended, the availability of
health coverage offered through employment or sponsored by an
employer has terminated or, an employer's contribution toward health
coverage has terminated, a carrier shall credit the time the person
was covered under creditable coverage if the person becomes eligible
for health coverage offered through employment or sponsored by an
employer within 180 days, exclusive of any waiting or affiliation
period, and applies for coverage under the succeeding plan within the
applicable enrollment period.
(f)
(g) No health benefit plan that covers three or more
persons and that is issued, renewed, or written by any insurer,
nonprofit hospital service plan, self-insured employee welfare
benefit plan, fraternal benefits society, or any other entity may
exclude late enrollees from coverage for more than 12 months from the
date of the late enrollee's application for coverage. No insurer,
nonprofit hospital service plan, self-insured employee welfare
benefit plan, fraternal benefits society, or any other entity shall
require any premium or other periodic charge to be paid by or on
behalf of a late enrollee during the period of exclusion from
coverage permitted by this subdivision.
(g)
(h) An individual's period of creditable coverage shall
be certified pursuant to subdivision (e) of Section 2701 of Title
XXVII of the federal Public Health Services Act, 42 U.S.C. Sec. 300gg
(e).
(h)
(i) A group health benefit plan may not impose a
preexisting condition exclusion to any of the following:
(1) To a newborn individual, who, as of the last day of the 30-day
period beginning with the date of birth, applied for coverage
through the employer-sponsored plan.
(2) To a child who is adopted or placed for adoption before
attaining 18 years of age and who, as of the last day of the 30-day
period beginning with the date of adoption or placement for adoption,
is covered under creditable coverage and applies for coverage
through the employer-sponsored plan. This provision shall not apply
if, for 63 continuous days, the child is not covered under any
creditable coverage.
(3) To a
condition relating to benefits for pregnancy or maternity care.
(i)
(j) Any entity providing aggregate or specific stop
loss coverage or any other assumption of risk with reference to a
health benefit plan shall provide that the plan meets all
requirements of this article concerning waiting periods, preexisting
condition provisions, and late enrollees.
SEC. 5. Section 10708 of the Insurance
Code is amended to read:
10708. (a) (1) Preexisting condition
provisions of health benefit plans shall not exclude coverage for a
period beyond six months following the individual's effective date of
coverage and may only relate to conditions for which medical advice,
diagnosis, care, or treatment, including the use of prescription
medications, was recommended by or received from a licensed health
practitioner during the six months immediately preceding the
effective date of coverage.
(2) Notwithstanding paragraph (1), a health benefit plan offered
to a small employer shall not impose any preexisting condition
provision upon any child under 19 years of age.
(b) A carrier that does not utilize a preexisting condition
provision may impose a waiting or affiliation period, not to exceed
60 days, before the coverage issued subject to this chapter shall
become effective. During the waiting or affiliation period, the
carrier is not required to provide health care benefits and no
premiums shall be charged to the subscriber or enrollee.
(c) In determining whether a preexisting condition provision or a
waiting period applies to any person, a plan shall credit the time
the person was covered under creditable coverage, provided the person
becomes eligible for coverage under the succeeding plan contract
within 62 days of termination of prior coverage, exclusive of any
waiting or affiliation period, and applies for coverage with the
succeeding health benefit plan contract within the applicable
enrollment period. A plan shall also credit any time an eligible
employee must wait before enrolling in the health benefit plan,
including any postenrollment or employer-imposed waiting or
affiliation period. However, if a person's employment has ended, the
availability of health coverage offered through employment or
sponsored by an employer has terminated, or an employer's
contribution toward health coverage has terminated, a plan shall
credit the time the person was covered under creditable coverage if
the person becomes eligible for health coverage offered through
employment or sponsored by an employer within 180 days, exclusive of
any waiting or affiliation period, and applies for coverage under the
succeeding health benefit plan within the applicable enrollment
period.
(d) Group health benefit plans may not impose a preexisting
conditions exclusion to the following: (1)
To a newborn individual, who, as of the
last day of the 30-day period beginning with the date of birth,
applied for coverage through the employer-sponsored plan. (2)
To a child who is adopted or
placed for adoption before attaining 18 years of age and who, as of
the last day of the 30-day period beginning with the date of adoption
or placement for adoption, is covered under creditable coverage and
applies for coverage through the employer-sponsored plan. This
provision shall not apply if, for 63 continuous days, the child is
not covered under any creditable coverage. (3)
To a condition relating to benefits for
pregnancy or maternity care.
(e) A carrier providing aggregate or specific stop loss coverage
or any other assumption of risk with reference to a health benefit
plan shall provide that the plan meets all requirements of this
section concerning preexisting condition provisions and waiting or
affiliation periods.
(f) In addition to the preexisting condition exclusions authorized
by subdivision (a) and the waiting or affiliation period authorized
by subdivision (b), carriers providing coverage to a guaranteed
association may impose on employers or individuals purchasing
coverage who would not be eligible for guaranteed coverage if they
were not purchasing through the association a waiting or affiliation
period, not to exceed 60 days, before the coverage issued subject to
this chapter shall become effective. During the waiting or
affiliation period, the carrier is not required to provide health
care benefits and no premiums shall be charged to the insured.
SEC. 2. SEC. 6. Chapter 9.7
(commencing with Section 10950) is added to Part 2 of Division 2 of
the Insurance Code, to read:
CHAPTER 9.7. INDIVIDUAL ACCESS TO HEALTH INSURANCE
10950. As used in this chapter:
(a) (1) "Child" means any
individual under 19 years of age.
(2) "Responsible party for a child" means an adult having custody
of a child with the right to make medical decisions for, and with the
responsibility for the financial needs of, the child.
(b) "Individual" means any individual 19 years of age or older.
(c) "In force business" means an existing health benefit plan
issued by a carrier to an individual.
(d) "New business" means a health benefit plan issued to an
individual that is not the carrier's in force business.
(e) "Preexisting condition provision" means a contract provision
that excludes coverage for charges or expenses incurred during a
specified period following the insured's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
(f) "Rating period" means the period for which premium rates
established by a carrier are in effect and shall be no less than 12
months.
(g) "Risk adjusted individual risk rate" means the rate determined
for an eligible individual or child in a particular risk category
after applying the risk adjustment factor.
(h) "Risk adjustment factor" means the percentage adjustment to be
applied equally to each standard risk rate for a particular child,
based upon any expected deviations from standard cost of services.
Between January 1, 2011, and December 31, 2011, inclusive, this
factor may not be more than 120 percent or less than 80 percent.
Between January 1, 2012, and December 31, 2013, inclusive, this
factor may not be more than 110 percent or less than 90 percent.
Effective January 1, 2014, the standard risk rate shall apply to all
policies sold to individuals or for children.
(i) "Risk category" means the following characteristics of an
eligible child: age, geographic region, and family composition of the
individual, plus the health benefit plan selected by the individual.
(1) Until January 1, 2014, no more than the following age
categories may be used in determining premium rates:
(A) Under age 1.
(B) Age 1 to 19.
(2) The rate shall not vary by more than 2 to 1 for children.
(3) Carriers shall base rates for individuals and children using
no more than the following family size categories:
(A) Single.
(B) More than one child and no adults.
(C) Married couple or registered domestic partners.
(D) One adult and one child.
(E) One adult and children.
(F) Married couple and child or children, or registered domestic
partners and child or children.
(4) In determining rates for individuals and children, a carrier
that operates statewide shall use the geographic regions specified in
Section 10700.
(j) Nothing in this section shall be construed to require a
carrier to establish a new service area or to offer health coverage
on a statewide basis, outside of the carrier's existing service area.
10951. (a) (1) Effective January 1, 2011, every carrier offering
health benefit plans for children shall offer coverage to the
responsible party for any child that seeks coverage.
(2) Effective January 1, 2014, every carrier offering health
benefit plans to individuals shall offer coverage to any individual
who seeks coverage.
(b) (1) Effective January 1, 2011, notwithstanding any other
provision of state law or regulation, every carrier offering
contracts for children shall not exclude or limit coverage due to any
preexisting condition.
(2) Effective January 1, 2014, notwithstanding any other provision
of state law or regulation, every carrier offering contracts for
individuals shall not exclude or limit coverage due to any
preexisting condition.
(c) This chapter shall not apply to coverage to which an employer
makes any contribution.
(d) Every carrier offering health benefit plans to individuals
shall, in addition to complying with the provisions of this part and
the rules adopted thereunder, comply with the provisions of this
chapter.
(b) "Individual grandfathered plan coverage" means health care
coverage in which an individual was enrolled on March 23, 2010,
consistent with Section 1251 of PPACA and any rules or regulations
adopted pursuant to that law.
(c) "Initial open enrollment period" means the open enrollment
period beginning on January 1, 2011, and ending 60 days thereafter.
(d) "Late enrollee" means a child without coverage who did not
enroll in a health benefit plan during an open enrollment period
because of any of the following:
(1) The child lost dependent coverage due to termination or change
in employment status of the child or the person through whom the
child was covered; cessation of an employer's contribution toward an
employee or dependent's coverage; death of the person through whom
the child was covered as a dependent; legal separation; divorce; loss
of coverage under the Healthy Families Program, the Access for
Infants and Mothers Program, or the Medi-Cal program; or adoption of
the child.
(2) The child became a resident of California during a month that
was not the child's birth month.
(3) The child is born as a resident of California and did not
enroll in the month of birth.
(4) The child is mandated to be covered pursuant to a valid state
or federal court order.
(e) "Open enrollment period" means the annual open enrollment
period subsequent to the initial open enrollment period, applicable
to each individual child that is the month of the child's birth date.
(f) "PPACA" means the federal Patient Protection and Affordable
Care Act (Public Law 111-148), as amended by the Health Care and
Education Reconciliation Act of 2010 (Public Law 111-152), and any
subsequent rules or regulations issued pursuant to that law.
(g) "Preexisting condition exclusion" means, with respect to
coverage, a limitation or exclusion of benefits relating to a
condition based on the fact that the condition was present before the
date of enrollment of the coverage, whether or not any medical
advice, diagnosis, care, or treatment was recommended or received
before that date.
(h) "Responsible party for a child" means an adult having custody
of the child or with responsibility for the financial needs of the
child, including the responsibility to provide health care coverage.
(i) "Standard risk rate" means the lowest rate that can be offered
for a child with the same benefit plan, effective date, age,
geographic region, and family status.
10951. (a) (1) During each open enrollment period, every carrier
offering health benefit plans in the individual market, other than
individual grandfathered plan coverage, shall offer to the
responsible party for a child coverage for the child that does not
exclude or limit coverage due to any preexisting condition of the
child.
(b) A carrier offering coverage in the individual market shall not
reject an application for a health benefit plan from a child or
filed on behalf of a child by the responsible party during an open
enrollment period or from a late enrollee during a period no longer
than 63 days from the qualifying event listed in subdivision (d) of
Section 10950.
(c) Except to the extent permitted by federal law, rules,
regulations, or guidance issued by the relevant federal agency, a
carrier shall not condition the issuance or offering of individual
coverage on any of the following factors:
(1) Health status.
(2) Medical condition, including physical and mental illnesses.
(3) Claims experience.
(4) Receipt of health care.
(5) Medical history.
(6) Genetic information.
(7) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(8) Disability.
(9) Any other health status-related factor as determined by
department.
This subdivision shall not apply to a health benefit plan
providing individual grandfathered plan coverage.
(d) When a responsible party for a child submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs earlier, within the first
15 days of the month, coverage under the health benefit plan shall
become effective no later than the first day of the following month.
When that payment is neither delivered nor postmarked until after the
15th day of the month, coverage shall become effective no later than
the first day of the second month following delivery or postmark of
the payment.
(e) A carrier offering coverage in the individual market shall not
reject the request of a responsible party for a child to include
that child as a dependent on an existing health benefit plan that
includes dependent coverage during an open enrollment period.
(f) Nothing in this chapter shall be construed to prohibit a
carrier offering coverage in the individual market from establishing
rules for eligibility for coverage and offering coverage pursuant to
those rules for children and individuals based on factors otherwise
authorized under federal and state law for health benefit plans in
addition to those offered on a guaranteed issue basis during an open
enrollment period to children or late enrollees pursuant to this
chapter. However, a carrier, other than a carrier providing
individual grandfathered plan coverage, shall not impose a
preexisting condition provision on coverage, including dependent
coverage, offered to a child.
(g) Nothing in this chapter shall be construed to require a
carrier to establish a new service area or to offer health care
coverage on a statewide basis, outside of the carrier's existing
service area.
(h) Nothing in this chapter shall be construed to prevent a
carrier from offering coverage to a family member of an enrollee in
grandfathered health plan coverage consistent with Section 1251 of
PPACA.
10952. This chapter shall not apply to health benefit plans for
coverage of Medicare services pursuant to contracts with the United
States government, Medicare supplement policies, Medi-Cal contracts
with the State Department of Health Care Services, policies offered
under the Healthy Families Program, long-term care coverage, or
specialized health benefit plans.
10953. (a) Upon the effective date of this chapter, a carrier
shall fairly and affirmatively offer, market, and sell all of the
carrier's contracts that are offered and sold to the responsible
party for a child. Effective January 1, 2014, a carrier shall fairly
and affirmatively offer, market, and sell all of the carrier's
contracts that are sold to individuals.
(b) Effective January 1, 2011, a carrier shall not reject an
application from the responsible party for a child for a health
benefit plan. Effective January 1, 2014, a carrier shall not reject
an application from an individual for a health benefit plan.
10953. (a) Upon the
effective date of this chapter, a carrier shall fairly and
affirmatively offer, market, and sell all of the carrier's health
benefit plans that are offered and sold to a child or the responsible
party for a child in each service area in which the plan provides or
arranges for health care coverage during any open enrollment period,
to late enrollees, and during any other period in which state or
federal law, rules, regulations, or guidance expressly provide that a
carrier shall not condition offer or acceptance of coverage on any
preexisting condition.
(c)
(b) No carrier or solicitor shall, directly
or indirectly, engage in the following activities:
(1) Encourage or direct an individual a
child or responsible party for a child to refrain from filing
an application for coverage with a carrier because of the health
status, claims experience, industry, occupation, or geographic
location, provided that the location is within the carrier's approved
service area, of the individual or child.
(2) Encourage or direct individuals or children
a child or responsible party for a child to seek coverage
from another carrier because
of the health status, claims experience, industry, occupation, or
geographic location, provided that the location is within the carrier'
s approved service area, of the individual or
child.
(d)
(c) A carrier shall not, directly or indirectly, enter
into any contract, agreement, or arrangement with a solicitor that
provides for or results in the compensation paid to a solicitor for
the sale of a health benefit plan to be varied because of the health
status, claims experience, industry, occupation, or geographic
location of the individual or child. This
subdivision does not apply to a compensation arrangement that
provides compensation to a solicitor on the basis of percentage of
premium, provided that the percentage shall not vary because of the
health status, claims experience, industry, occupation, or geographic
area of the individual or child.
(e) Effective January 1, 2011, a health benefit plan that covers a
child shall not establish rules for eligibility, including continued
eligibility, of an individual, or dependent of an individual, to
enroll under the terms of the carrier based on any of the following
health status-related factors:
(1) Health status.
(2) Medical condition, including physical and mental illnesses.
(3) Claims experience.
(4) Receipt of health care.
(5) Medical history.
(6) Genetic information.
(7) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(8) Disability.
(9) Any other health status-related factor determined appropriate
by department.
(f) A carrier shall comply with the requirements of subdivision
(c) of Section 10119.
(g) Effective January 1, 2014, this section shall apply to all
individuals and children obtaining coverage with no contribution from
an employer.
10954. (a) After an individual or the responsible party for a
child submits a completed application form for a health benefit plan,
the carrier shall, within 30 days, notify the individual or
responsible party for a child of actual premium charges for that
health benefit plan established in accordance with Section 10960. The
individual or responsible party for a child shall have 30 days in
which to exercise the right to buy coverage at the quoted premium
charges.
(b) When an individual or the responsible party for a child
submits a premium payment, based on the quoted premium charges, and
that payment is delivered or postmarked, whichever occurs earlier,
within the first 15 days of the month, coverage under the health
benefit plan shall become effective no later than the first day of
the following month. If that payment is delivered or postmarked after
the 15th day of a month, coverage shall become effective no later
than the first day of the second month following delivery or postmark
of the payment.
(c) During the first 60 days after the effective date of the
health benefit plan, the individual or responsible party for a child
shall have the option of changing coverage to a different health
benefit plan offered by the same carrier. If an individual or the
responsible party for a child notifies the carrier of the change
within the first 15 days of a month, coverage under the new health
benefit plan shall become effective no later than the first day of
the following month. If an individual or the responsible party for a
child notifies the carrier of the change after the 15th day of a
month, coverage under the new health benefit plan shall become
effective no later than the first day of the second month following
notification.
10955. (a) Effective January 1, 2011, a carrier may not exclude
any child who would otherwise be entitled to health care services on
the basis of an actual or expected health condition of that child. No
health benefit plan may limit or exclude coverage for a child by
type of illness, treatment, medical condition, or accident.
(b) Effective January 1, 2014, a carrier may not exclude any
individual who would otherwise be entitled to health care services on
the basis of an actual or expected health condition of that
individual. No health benefit plan may limit or exclude coverage for
a child by type of illness, treatment, medical condition, or
accident.
10954. (a) A carrier may use the following characteristics of an
eligible child for purposes of establishing the rate of the health
benefit plan for that child, where consistent with federal
regulations under PPACA: age, geographic region, and family
composition, plus the health benefit plan selected by the child or
the responsible party for a child.
(b) From the effective date of this chapter to December 31, 2013,
inclusive, rates for a child applying for coverage shall be subject
to the following limitations:
(1) During any open enrollment period or for late enrollees, the
rate for any child due to health status shall not be more than two
times the standard risk rate for a child.
(2) The rate for a child shall be subject to a 20-percent
surcharge above the highest allowable rate on a child applying for
coverage who is not a late enrollee and who failed to maintain
coverage with any carrier or health care service plan for the 90-day
period prior to the date of the child's application. The surcharge
shall apply for the 12-month period following the effective date of
the child's coverage.
(3) If expressly permitted under PPACA and any rules, regulations,
or guidance issued pursuant to that act, a carrier may rate a child
based on health status during any period other than an open
enrollment period if the child is not a late enrollee.
(4) If expressly permitted under PPACA and any rules, regulations,
or guidance issued pursuant to that act, a carrier may condition an
offer or acceptance of coverage on any preexisting condition or other
health status-related factor for a period other than an open
enrollment period and for a child who is not a late enrollee.
(c) For any individual health benefit plan issued, sold, or
renewed prior to December 31, 2013, the carrier shall provide to a
child or responsible party for a child a notice that states the
following:
"Please consider your options carefully before failing to maintain
or renew coverage for a child for whom you are responsible. If you
attempt to obtain new individual coverage for that child, the premium
for the same coverage may be higher than the premium you pay now."
(d) A child who applied for coverage between September 23, 2010,
and the end of the initial enrollment period shall be deemed to have
maintained coverage during that period.
(e) Effective January 1, 2014, except for individual grandfathered
health plan coverage, the rate for any child shall be identical to
the standard risk rate.
(f) Carriers may require documentation from applicants relating to
their coverage history.
10957. No carrier shall be required to offer a health benefit
plan or accept applications for the contract pursuant to this chapter
in the case of any of the following:
(a) To an individual or child, if the individual or child who is
(a) To a child, if the child who is
to be covered by the health benefit plan does not work or
reside within the carrier's approved service areas.
(b) (1) Within a specific service area or portion of a service
area, if the carrier reasonably anticipates and demonstrates to the
satisfaction of the commissioner that it will not have sufficient
health care delivery resources to ensure that health care services
will be available and accessible to the individual or
child because of its obligations to existing insureds.
(2) A carrier that cannot offer a health benefit plan to
individuals or children because it is lacking in sufficient health
care delivery resources within a service area or a portion of a
service area may not offer a contract in the area in which the
carrier is not offering coverage to individuals to new employer
groups until the carrier notifies the commissioner that it has the
ability to deliver services to individuals, and certifies to the
commissioner that from the date of the notice it will enroll all
individuals requesting coverage in that area from the carrier.
(3) Nothing in this chapter shall be construed to limit the
commissioner's authority to develop and implement a plan of
rehabilitation for a carrier whose financial viability or
organizational and administrative capacity has become impaired.
10958. The commissioner may require a carrier to discontinue the
offering of contracts or acceptance of applications from any
individual or child or responsible party for a child upon
a determination by the commissioner that the carrier does not have
sufficient financial viability or organizational and administrative
capacity to ensure the delivery of health care services to its
insureds. In determining whether the conditions of this section have
been met, the commissioner shall consider, but not be limited to, the
carrier's compliance with the requirements of this part and the
rules adopted under those provisions.
10959. All health benefit plans offered to a child or individual
shall be renewable at the option of the insured or responsible party
for a child except:
(a) For nonpayment of the required premiums by the insured or
responsible party for a child.
(b) For fraud or misrepresentation by the individuals or their
representatives.
(c) When the carrier ceases to provide or arrange for the
provision of health care services for new individual health benefit
plans in this state; provided, however, that the following conditions
are satisfied:
(1) Notice of the decision to cease new or existing individual
health benefits plans in this state is provided to the commissioner
and to the contractholder at least 360 days prior to the
discontinuation of the coverage.
(2) Individual health benefit plans subject to this chapter shall
not be canceled for 360 days after the date of the notice required
under paragraph (1) and for that business of a carrier which remains
in force, any carrier that ceases to offer for sale new individual
health benefit plans shall continue to be governed by this chapter
with respect to business conducted under this chapter.
(3) Except as authorized under Section 10958, a carrier that
ceases to write new individual business in this state after the
effective date of this chapter shall be prohibited from offering for
sale new individual health benefit plans in this state for a period
of five years from the date of notice to the commissioner.
(d) When the carrier withdraws a health benefit plan from the
individual market; provided, the carrier notifies all affected
contractholders and the commissioner at least 180 days prior to the
discontinuation of those contracts, and the carrier makes available
to the individual all health benefit plans that it makes available to
new individual business; and provided, that the premium for the new
health benefit plan complies with the renewal increase requirements
set forth in Section 10960.
10960. Effective January 1, 2011, premiums for contracts offered
or delivered by carriers on or after the effective date of this
chapter for children shall be subject to the following requirements:
(a) The premium for new business shall be determined for an
eligible child in a particular risk category after applying a risk
adjustment factor to the carrier's standard risk rates. Between
January 1, 2011, and December 31, 2011, inclusive, the risk adjusted
risk rate may not be more than 120 percent or less than 80 percent of
the carrier's applicable standard risk rate. Between January 1,
2012, and December 31, 2013, inclusive, this factor may not be more
than 110 percent or less than 90 percent. The standard risk rates
applied to a child for new business shall be in effect for no less
than 12 months.
(b) (1) The premium for in force business shall be determined for
an eligible child in a particular risk category after applying a risk
adjustment factor to the carrier's standard individual risk rates.
Between January 1, 2011, and December 31, 2011, inclusive, the risk
adjusted individual risk rates may not be more than 120 percent or
less than 80 percent of the carrier's applicable standard risk rate.
Between January 1, 2012, and December 31, 2013, inclusive, this
factor may not be more than 110 percent or less than 90 percent. The
factor effective January 1, 2011, shall apply to in force business at
the earlier of either the time of renewal or January 1, 2012. The
risk adjustment factor applied to a child may not increase by more
than 10 percentage points from the risk adjustment factor applied in
the prior rating period. The risk adjustment factor for a child may
not be modified more frequently than once every 12 months.
(2) The standard risk rates shall be in effect for no less than 12
months.
(3) For a contract that a carrier has discontinued offering, the
risk adjustment factor applied to the standard risk rates for the
first rating period of the new contract that the responsible party
for the child elects to purchase shall be no greater than the risk
adjustment factor applied in the prior rating period to the
discontinued contract. However, between January 1, 2011, and December
31, 2011, inclusive, the risk adjusted individual risk rate may not
be more than 120 percent or less than 80 percent of the carrier's
applicable standard risk rate. Between January 1, 2012, and December
31, 2013, inclusive, this factor may not be more than 110 percent or
less than 90 percent. The factor effective January 1, 2011, shall
apply to in force business at the earlier of either the time of
renewal or January 1, 2012. The risk adjustment factor for a child
may not be modified more frequently than once every 12 months.
10961. Carriers shall apply standard risk rates consistently with
respect to all children.
10962. In connection with the offering for sale of any health
benefit plan for children, each carrier shall make a reasonable
disclosure, as part of its solicitation and sales materials, of the
following:
(a) The extent to which premium rates for a specific child are
established or adjusted in part based upon the actual or expected
variation in service costs or actual or expected variation in health
condition of the child.
(b) The provisions concerning the carrier's right to change
premium rates and the factors, other than provision of services
experience, that affect changes in premium rates.
(c) Provisions relating to the guaranteed issue and renewal of
contracts.
(d) Provisions relating to the child's right to apply for any
contract written, issued, or administered by the carrier at the time
of application for a new health benefit plan, or at the time of
renewal of a health benefit plan.
(e) The availability, upon request, of a listing of all the plan's
contracts and benefit plan designs offered for children, including
the rates for each contract.
(f) At the time it offers a contract to the responsible party for
a child, each carrier shall provide the responsible party with a
statement of all of its health benefit plans offered to children,
including the rates for each health benefit plan, in the service area
in which the individuals who are to be covered by the health benefit
plan reside. For purposes of this subdivision, carriers that are
affiliated carriers or that are eligible to file a consolidated
income tax return shall be treated as one carrier.
(g) Each carrier shall do all of the following:
(1) Prepare a brochure that summarizes all of its health benefit
plans offered to children and to make this summary available to any
responsible party for a child and to solicitors upon request. The
summary shall include for each contract information on benefits
provided, a generic description of the manner in which services are
provided, such as how access to providers is limited, benefit
limitations, required copayments and deductibles, standard risk
rates, and a telephone number that can be called for more detailed
benefit information. Carriers are required to keep the information
contained in the brochure accurate and up to date and, upon updating
the brochure, send copies to solicitors and solicitor firms with whom
the health benefit plans to solicit enrollments or subscriptions.
(2) For each contract, prepare a more detailed evidence of
coverage and make it available to responsible parties, solicitors,
and solicitor firms upon request. The evidence of coverage shall
contain all information that a prudent buyer would need to be aware
of in making contract selections.
(3) Provide to responsible parties and solicitors, upon request,
for any given child the standard risk rates. When requesting this
information, responsible parties, solicitors, and solicitor firms
shall provide the carrier with the information the carrier needs to
determine the child's risk adjusted risk rate.
(4) Provide copies of the current summary brochure to all
solicitors and solicitor firms contracting with the carrier to
solicit enrollments or subscriptions from responsible parties for
children.
For purposes of this subdivision, carriers that are affiliated
carriers or that are eligible to file a consolidated income tax
return shall be treated as one carrier.
(h) Every solicitor or solicitor firm contracting with one or more
carriers to solicit enrollments or subscriptions from responsible
parties for children shall do all of the following:
(1) When providing information on contracts to a responsible party
for a child or children but making no specific recommendations on
particular health benefit plans:
(A) Advise the responsible party of the carrier's obligation to
sell to any responsible party any health benefit plan it offers for
children and provide them, upon request, with the actual rates that
would be charged for that child for a given contract.
(B) Notify the responsible party that the solicitor or solicitor
firm will procure rate and benefit information for the responsible
party for the child on any health benefit plan offered by a carrier
whose contract the solicitor sells.
(C) Notify the responsible party that upon request the solicitor
or solicitor firm will provide the responsible party with the summary
brochure required under this paragraph for any health benefit plan
offered by a carrier with whom the solicitor or solicitor firm has
contracted to solicit enrollments or subscriptions.
(2) When recommending a particular benefit plan design or designs,
advise the responsible party that, upon request, the agent will
provide the responsible party with the brochure required by paragraph
(1) containing the benefit plan design or designs being recommended
by the agent or broker.
(3) Prior to filing an application for a responsible party for a
child for a particular contract:
(A) For each of the health benefit plans offered by the carrier
whose contract the solicitor or solicitor firm is offering, provide
the responsible party with the benefit summary required in paragraph
(1) and the standard risk rates for that particular child.
(B) Notify the responsible party that, upon request, the solicitor
or solicitor firm will provide the responsible party with an
evidence of coverage brochure for each contract the carrier offers.
(C) Notify the responsible party for a child that, from January 1,
2011, to December 31, 2011, inclusive, actual rates may be 20
percent higher or lower than the standard risk rates, and from
January 1, 2012, to December 31, 2013, inclusive, actual rates may be
10 percent higher or lower than the standard risk rates, depending
on how the carrier assesses the risk of the child.
(D) Notify the responsible party that, upon request, the solicitor
or solicitor firm will submit information to the carrier to
ascertain the child's risk adjusted risk rate for any contract the
carrier offers.
(E) Obtain a signed statement from the responsible party
acknowledging that the responsible party has received the disclosures
required by this section.
10963. (a) At least 30 business days prior to renewing or
amending a health benefit plan subject to this chapter that will be
in force on the operative date of this chapter, a carrier shall file
a notice of material modification with the commissioner. The notice
of material modification shall include a statement certifying that
the carrier is in compliance with subdivision (i) of Section 10950
and Section 10960. The certified statement shall set forth the
standard risk rate for each risk category and the highest and lowest
risk adjustment factors that will be used in setting the rates at
which the contract will be renewed or amended. Any action by the
commissioner to disapprove, suspend, or postpone the carrier's use of
a health benefit plan shall be in writing, specifying the reasons
that the health benefit plan is not in compliance with the
requirements of this chapter.
(b) At least 30 business days prior to offering a health benefit
plan subject to this chapter, all carriers shall file a notice of
material modification with the commissioner. The notice of material
modification shall include a statement certifying that the carrier is
in compliance with subdivision (i) of Section 10950 and Section
10960. The certified statement shall set forth the standard risk rate
for each risk category and the highest and lowest risk adjustment
factors that will be used in setting the rates at which the contract
will be offered. Carriers that will be offering to a responsible
party for a child contracts approved by the commissioner prior to the
effective date of this chapter shall file a notice of material
modification in accordance with this subdivision. Any action by the
commissioner to disapprove, suspend, or postpone the carrier's use of
a health benefit plan shall be in writing, specifying the reasons
that the health benefit plan is not in compliance with the
requirements of this chapter.
(c) Prior to making any changes in the risk categories, risk
adjustment factors or standard risk rates filed with the commissioner
pursuant to subdivision (a) or (b), the carrier shall file, as an
amendment, a statement setting forth the changes and certifying that
the carrier is in compliance with subdivision (i) of Section 10950
and Section 10960. A carrier may commence offering health benefit
plans utilizing the changed risk categories set forth in the
certified statement on the 45th day from the date of the filing, or
at an earlier time determined by the commissioner, unless the
commissioner disapproves the amendment by written notice, stating the
reasons therefor. If only the standard risk rate is being changed,
and not the risk categories or risk adjustment factors, a carrier may
commence offering health benefit plans utilizing the changed
standard risk rate upon the 31st day after filing the certified
statement unless the commissioner disapproves the amendment by
written notice.
(d) Periodic changes to the standard risk rate that a carrier
proposes to implement over the course of up to 12 consecutive months
may be filed in conjunction with the certified statement filed under
subdivision (a), (b), or (c).
(e) Each carrier shall maintain at its principal place of business
all of the information required to be filed with the commissioner
pursuant to this section.
(f) Each carrier shall make available to the commissioner,
on request, the risk adjustment factor used in determining the rate
for any particular child.
(g) Nothing in this section shall be construed to limit the
commissioner's authority to enforce the rating practices set forth in
this chapter.
10964. The commissioner may issue regulations that are necessary
to carry out the purposes of this chapter. Prior to the public
comment period required by regulations under the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code), the commissioner
shall provide the Director of Managed Health Care with a copy of the
proposed regulations. The director shall have 30 days to notify the
commissioner in writing of any comments on the regulations. The
director's comments shall be included in the public notice issued on
the regulations. Any rules and regulations adopted pursuant to this
chapter may be adopted as emergency regulations in accordance with
the Administrative Procedure Act. Until December 31, 2015, the
adoption of these regulations shall be deemed an emergency and
necessary for the immediate preservation of the public peace, health
and safety, or general welfare. Any regulations adopted prior to
December 31, 2015, in order to remain in effect after December 31,
2016, shall be readopted as nonemergency regulations in accordance
with the Administrative Procedure Act prior to December 31, 2016.
10959. (a) All health benefit plans offered to a child or on
behalf of a child to a responsible party for a child shall conform to
the requirements of Section 10127.18, 12682.1, and 10273.4, and
shall be renewable at the option of the child or responsible party
for a child on behalf of the child except as permitted to be
canceled, rescinded or not renewed pursuant to Section 10273.4.
(b) Any carrier that ceases to offer for sale new individual
health benefit plans pursuant to Section 10273.4 shall continue to be
governed by this chapter with respect to business conducted under
this chapter.
(c) Except as authorized under Section 10958, a carrier that as of
the effective date of this chapter does not write new health benefit
plans for children in this state or that after the effective date of
this chapter ceases to write new health benefit plans for children
in this state shall be prohibited from offering for sale new
individual health benefit plans or in this state for a period of five
years from the date of notice to the commissioner.
10960. On or before July 1, 2011, the commissioner may issue
guidance to health plans regarding compliance with this chapter and
such guidance shall not be subject to the Administrative Procedure
Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code. The guidance shall only
be effective until the commissioner and the Director of the
Department of Managed Health Care adopt joint regulations pursuant to
the Administrative Procedure Act.
SEC. 3. SEC. 7. 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.
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