BILL NUMBER: SB 156	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 20, 2009
	AMENDED IN SENATE  APRIL 14, 2009

INTRODUCED BY   Senator Wright

                        FEBRUARY 12, 2009

   An act to add Section  1873.5   1879.1 
to the Insurance Code, relating to insurance fraud.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 156, as amended, Wright. Insurance: fraud prevention and
detection.
   Existing law generally provides for the prevention, detection, and
investigation of insurance fraud. Under existing law, insurers are
required to disclose to an authorized governmental agency information
relative to incidents of workers' compensation fraud, as specified.
   This bill would authorize the Department of Insurance or a
district attorney to convene meetings with  insurers
  an insurance company  to discuss 
emerging trends and schemes involving   a specific 
insurance fraud and would provide that any person sharing
information pursuant to that authorization would be protected from
civil liability, as specified.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


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

  SECTION 1.  The Legislature hereby finds and declares all of the
following:
   (a) The California Department of Insurance regulates more than 123
billion dollars ($123,000,000,000) of insurance business annually.
Workers' compensation business  accounts  
accounted  for 11.5 billion dollars ($11,500,000,000) of that
business as of 2006.
   (b) A report issued by the Department of Insurance Advisory Task
Force in May of 2008 estimated that insurance fraud of regulated
businesses amounts to costs of 15 billion dollars ($15,000,000,000)
per year, costing each resident an average of more than five hundred
dollars ($500) per year.
   (c) Perpetrators  of fraud often involved  
often defraud  more than one insurance program. An effective
antifraud effort requires greater cooperation, coordination, and
communication of impacted insurers, services, and regulating
agencies. 
   (d) One effective strategy used by the Medicaid and Medi-Cal
programs to combat fraud involves sending an explanation of benefits
notice to the recipients of services who can then confirm if
fraudulent or excessive billing has occurred. California's workers'
compensation program does not provide this notice which many
employers and law enforcement officials believe could help reduce
incidents of fraudulent billing.  
   (e) 
    (d)  It is the intent of the Legislature to enact
statutory provisions to provide law enforcement regulators and the
regulated community additional insurance antifraud tools and
protections. 
  SEC. 2.    Section 1873.5 is added to the
Insurance Code, to read:
   1873.5.  The commissioner, his or her designated deputy 
   SEC. 2.    Section 1879.1 is added to the  
Insurance Code   , to read: 
    1879.1.   The commissioner, his or her designated
deputy  commissioner,  or  a district attorney, or his
or her designated deputy district attorney, may convene meetings with
representatives of  insurance companies   an
insurance company  to discuss  emerging trends and
schemes involving   a specific  insurance fraud.
Information shared during the course of those meetings  ,
including possible evidence of other criminal activity not involving
  that is related to a specific  insurance fraud
 ,  shall be protected by the provisions of Section
1873.2.