BILL ANALYSIS
AB 2275
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 2275 (Hayashi)
As Amended August 17, 2010
Majority vote
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|ASSEMBLY: | |(May 10, 2010) |SENATE: |33-0 |(August 18, |
| | | | | |2010) |
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(vote not relevant)
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|COMMITTEE VOTE: |18-0 |(August 24, 2010) |RECOMMENDATION: |concur |
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Original Committee Reference: B.P. & C.P.
SUMMARY : Prohibits contracts issued, amended, or renewed on or
after January 1, 2011, between a health care service plan, a
specialized health care service plan, or an insurer, and a dentist
from requiring a dentist to accept a payment amount set by the plan
or insurer for dental care services provided to an enrollee or
insured that are not covered under the contract. Prohibits a
provider from charging more for non-covered dental services than
his or her usual and customary rate for those services.
The Senate amendments delete the Assembly approved version of this
bill and instead:
1)Prohibit a full service or specialized health plan or insurer,
with respect to plan contracts and policies issued, amended, or
renewed on or after January 1, 2011, that cover dental services,
from requiring a dentist to accept an amount set by the plan or
insurer as payment for non-covered dental care services provided
to an enrollee or insured.
2)Prohibit providers from charging more for non-covered dental
services under a plan contract or insurance policy than their
usual and customary rate for those services.
3)Requires the evidence of coverage (EOC) and disclosure form, or
combined EOC and disclosure form, with respect to plan contracts
and policies issued, amended, or renewed on or after July 1,
AB 2275
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2011, that cover dental services, to include the following
statements:
a) If a patient opts to receive non-covered dental services, a
participating dental provider may charge his or her usual and
customary rate for those services;
b) Prior to providing a patient with dental services that are
not a covered benefit, the dentist should provide to the
patient a treatment plan that includes each anticipated
service to be provided and the estimated cost of each service;
c) If the patient would like more information about dental
coverage options, the patient may call member services at
[insert appropriate telephone number], or his or her insurance
broker; and,
d) To fully understand his or her coverage, the patient may
wish to carefully review this EOC document.
4)Define "covered services" to mean dental care services for which
the plan or insurer is obligated to pay pursuant to an enrollee's
plan contract or insured's policy or for which the plan or
insurer would be obligated to pay pursuant to an enrollee's plan
contract or insured's policy but for the application of
contractual limitations, such as deductibles, copayments,
coinsurance, waiting periods, annual or lifetime maximums,
frequency limitations, or alternative benefit payments.
AS PASSED BY THE ASSEMBLY , this bill required annual state property
inventory reports by the Department of General Services to be
completed and updated by January 1 of each year.
FISCAL EFFECT : According to the Senate Appropriations Committee,
costs to the California Department of Insurance would be minor and
absorbable and costs to the Department of Managed Health Care would
continue to be about $60,000 - $70,000 in fiscal year 2010-2011,
but would likely be minor ongoing.
COMMENTS : Covered dental services often include preventive and
diagnostic services, such as cleaning and routine dental exams;
basic dental care and procedures, such as fillings and extractions;
and major dental care, usually involving root canals and crowns.
Generally, orthodontia, cosmetic services, and implants are
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excluded from benefits and are considered "non-covered dental
services." Cost-sharing for dental benefits is structured similarly
to general health benefits, with the amount of deductibles and
cost-sharing depending on the type of service. Often basic dental
care and procedures have lower deductibles and cost-sharing
amounts, while major services, such as crowns and root canals have
higher deductibles and out-of-pocket costs. Many dental plans have
an annual cap for covered services, at which point the plan stops
contributing to the cost of services until the next enrollment
year.
According to the author, this bill is intended to prohibit dental
benefit plans regulated by DMHC and CDI from setting fees charged
by dental practices for procedures that the dental plan does not
cover in its scope of benefits. The author asserts that the policy
of dental benefit plans capping fees for procedures they do not
cover is an intrusion into the marketplace, and results in the
plans dictating fees for services they have no financial stake in,
and for which the plan bears no risk. Furthermore, the author and
sponsor state that dentists are not given the opportunity to refuse
provisions requiring dentists to adhere to discounted fees for
procedures that a dental plan doesn't cover, but must accept them
along with the entire contract if they want to participate in the
plan's provider network. The author and sponsor maintain that the
capping of fees for non-covered services is used as a marketing
tool by plans and insurers with prospective subscribing groups, and
has given an advantage to the larger dental benefit companies which
have a larger market share and more negotiating power. The sponsor
states that this bill seeks to level the playing field among all
dental plans.
Analysis Prepared by : Cassie Rafanan / HEALTH / (916) 319-2097
FN: 0006743