BILL ANALYSIS AB 2345 Page 1 ASSEMBLY THIRD READING AB 2345 (De La Torre) As Amended April 22, 2010 Majority vote HEALTH 13-0 -------------------------------- |Ayes:|Monning, Ammiano, Carter, | | | | | |De La Torre, De Leon, | | |Eng, Hayashi, Hernandez, | | |Jones, Bonnie Lowenthal, | | |Nava, V. Manuel Perez, | | |Salas | | | | -------------------------------- SUMMARY : Requires health insurers to annually post specified information used for rating and underwriting decisions related to individual health insurance policies on their Web sites. EXISTING LAW : 1)Provides for the regulation of health insurers by the California Department of Insurance (CDI) and requires insurers to have written policies, procedures, and underwriting guidelines establishing the criteria and process whereby the insurer makes its decision to provide or to deny coverage to individuals who apply for coverage and sets the rate for that coverage. 2)Requires an insurer to annually file with the commissioner a general description of the criteria, policies, procedures, or guidelines that the insurer uses for rating and underwriting decisions related to individual health insurance policies, as specified. FISCAL EFFECT : None COMMENTS : According to the author, while existing law requires CDI to post insurers' written policies, procedures, and underwriting guidelines for the decision making process on denials, they are difficult for the layperson to find. Furthermore, when a person shops for insurance they typically AB 2345 Page 2 look at an individual health insurer's Web sites, not CDI's site. Therefore, the author argues that this information should be posted on the same Web site as the rest of the information the consumer uses to make decisions about what health insurance to purchase. SB 1163 (Leno) contains a provision substantially similar to that contained in this bill and makes a number of other changes to existing law related to health insurance rates and underwriting, including: 1)Extending requirements placed on health plans and insurers when they deny individual coverage to when plans and insurers deny group purchasers. 2)Requiring health plans and insurers to provide data and demographic information on individual and large group denials of coverage, any changes in rates, any changes in cost sharing, and any changes in covered benefits. 3)Requiring health plans and insurers to provide to its regulator specified information, such as provider prices and utilization increases, with respect to rate increases for each product. SB 1163 passed by a vote of 5-0 when it was heard in the Senate Health Committee on April 21, 2010. AB 356 (Chan), Chapter 526, Statutes of 2006, requires health plans and insurers selling products in the individual market to disclose specified information to individuals applying for coverage, and to those who have such coverage, and to report a general description of their rating and underwriting criteria and policies to the Department of Managed Health Care and CDI, as specified. Analysis Prepared by : Melanie Moreno / HEALTH / (916) 319-2097 FN: 0004213