BILL NUMBER: SB 900	CHAPTERED
	BILL TEXT

	CHAPTER  659
	FILED WITH SECRETARY OF STATE  SEPTEMBER 30, 2010
	APPROVED BY GOVERNOR  SEPTEMBER 30, 2010
	PASSED THE SENATE  AUGUST 24, 2010
	PASSED THE ASSEMBLY  AUGUST 20, 2010
	AMENDED IN ASSEMBLY  AUGUST 19, 2010
	AMENDED IN ASSEMBLY  AUGUST 16, 2010
	AMENDED IN ASSEMBLY  AUGUST 2, 2010
	AMENDED IN ASSEMBLY  JUNE 23, 2010
	AMENDED IN SENATE  MAY 20, 2010
	AMENDED IN SENATE  MAY 5, 2010
	AMENDED IN SENATE  APRIL 8, 2010

INTRODUCED BY   Senators Alquist and Steinberg
   (Principal coauthor: Assembly Member John A. Perez)
   (Coauthor: Senator Pavley)

                        JANUARY 26, 2010

   An act to add Title 22 (commencing with Section 100500) to the
Government Code, to add Section 1346.2 to the Health and Safety Code,
and to add Section 10112.4 to the Insurance Code, relating to health
care coverage.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 900, Alquist. California Health Benefit Exchange.
   Existing law, the federal Patient Protection and Affordable Care
Act, requires each state to, by January 1, 2014, establish an
American Health Benefit Exchange that makes available qualified
health plans to qualified individuals and qualified employers, as
specified, and meets certain other requirements. Existing law
provides for the licensure and regulation of health care service
plans by the Department of Managed Health Care and the regulation of
health insurers by the Department of Insurance.
   This bill would, contingent on the enactment and operation of AB
1602, establish the California Health Benefit Exchange (the Exchange)
within state government. The bill would require the Exchange to be
governed by a board composed of the Secretary of California Health
and Human Services, or his or her designee, and 4 other members
appointed by the Governor and the Legislature in a specified manner
and would enact other related provisions with respect to the
governance of the Exchange. The bill would also require the board of
the exchange, or the California Health and Human Services Agency, if
a majority of the board has not been appointed, to apply for and
receive federal funds for purposes of establishing the Exchange.
   The bill would require the Director of the Department of Managed
Health Care and the Insurance Commissioner to review an Internet
portal developed by the United States Department of Health and Human
Services and to jointly develop and maintain an electronic
clearinghouse of coverage available in the individual and small
employer markets if the federal Internet portal does not adequately
achieve certain purposes.


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

  SECTION 1.  It is the intent of the Legislature to enact the
necessary statutory changes to California law in order to establish
an American Health Benefit Exchange in California as required by the
federal Patient Protection and Affordable Care Act (Public Law
111-148), as amended by the federal Health Care and Education
Reconciliation Act of 2010 (Public Law 111-152).
  SEC. 2.  Title 22 (commencing with Section 100500) is added to the
Government Code, to read:

      TITLE 22.  CALIFORNIA HEALTH BENEFIT EXCHANGE


   100500.  (a) There is in state government the California Health
Benefit Exchange, an independent public entity not affiliated with an
agency or department, which shall be known as the Exchange. The
Exchange shall be governed by an executive board consisting of five
members who are residents of California. Of the members of the board,
two shall be appointed by the Governor, one shall be appointed by
the Senate Committee on Rules, and one shall be appointed by the
Speaker of the Assembly. The Secretary of California Health and Human
Services or his or her designee shall serve as a voting, ex officio
member of the board.
   (b) Members of the board, other than an ex officio member, shall
be appointed for a term of four years, except that the initial
appointment by the Senate Committee on Rules shall be for a term of
five years, and the initial appointment by the Speaker of the
Assembly shall be for a term of two years. Appointments by the
Governor made after January 2, 2011, shall be subject to confirmation
by the Senate. A member of the board may continue to serve until the
appointment and qualification of his or her successor. Vacancies
shall be filled by appointment for the unexpired term. The board
shall elect a chairperson on an annual basis.
   (c) (1) Each person appointed to the board shall have demonstrated
and acknowledged expertise in at least two of the following areas:
   (A) Individual health care coverage.
   (B) Small employer health care coverage.
   (C) Health benefits plan administration.
   (D) Health care finance.
   (E) Administering a public or private health care delivery system.

   (F) Purchasing health plan coverage.
   (2) Appointing authorities shall consider the expertise of the
other members of the board and attempt to make appointments so that
the board's composition reflects a diversity of expertise.
   (d) Each member of the board shall have the responsibility and
duty to meet the requirements of this title, the federal act, and all
applicable state and federal laws and regulations, to serve the
public interest of the individuals and small businesses seeking
health care coverage through the Exchange, and to ensure the
operational well-being and fiscal solvency of the Exchange.
   (e) In making appointments to the board, the appointing
authorities shall take into consideration the cultural, ethnic, and
geographical diversity of the state so that the board's composition
reflects the communities of California.
   (f) (1) A member of the board or of the staff of the Exchange
shall not be employed by, a consultant to, a member of the board of
directors of, affiliated with, or otherwise a representative of, a
carrier or other insurer, an agent or broker, a health care provider,
or a health care facility or health clinic while serving on the
board or on the staff of the Exchange. A member of the board or of
the staff of the Exchange shall not be a member, a board member, or
an employee of a trade association of carriers, health facilities,
health clinics, or health care providers while serving on the board
or on the staff of the Exchange. A member of the board or of the
staff of the Exchange shall not be a health care provider unless he
or she receives no compensation for rendering services as a health
care provider and does not have an ownership interest in a
professional health care practice.
   (2) A board member shall not receive compensation for his or her
service on the board but may receive a per diem and reimbursement for
travel and other necessary expenses, as provided in Section 103 of
the Business and Professions Code, while engaged in the performance
of official duties of the board.
   (3) For purposes of this subdivision, "health care provider" means
a person licensed or certified pursuant to Division 2 (commencing
with Section 500) of the Business and Professions Code, or licensed
pursuant to the Osteopathic Act or the Chiropractic Act.
   (g) No member of the board shall make, participate in making, or
in any way attempt to use his or her official position to influence
the making of any decision that he or she knows or has reason to know
will have a reasonably foreseeable material financial effect,
distinguishable from its effect on the public generally, on him or
her or a member of his or her immediate family, or on either of the
following:
   (1) Any source of income, other than gifts and other than loans by
a commercial lending institution in the regular course of business
on terms available to the public without regard to official status
aggregating two hundred fifty dollars ($250) or more in value
provided to, received by, or promised to the member within 12 months
prior to the time when the decision is made.
   (2) Any business entity in which the member is a director,
officer, partner, trustee, employee, or holds any position of
management.
   (h) There shall not be any liability in a private capacity on the
part of the board or any member of the board, or any officer or
employee of the board, for or on account of any act performed or
obligation entered into in an official capacity, when done in good
faith, without intent to defraud, and in connection with the
administration, management, or conduct of this title or affairs
related to this title.
   (i) The board shall hire an executive director to organize,
administer, and manage the operations of the Exchange. The executive
director shall be exempt from civil service and shall serve at the
pleasure of the board.
   (j) The board shall be subject to the Bagley-Keene Open Meeting
Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1
of Division 3 of Title 2), except that the board may hold closed
sessions when considering matters related to litigation, personnel,
contracting, and rates.
   (k) (1) The board shall apply for planning and establishment
grants made available to the Exchange pursuant to Section 1311 of the
federal act. If an executive director has not been hired under
subdivision (i) when the United States Secretary of Health and Human
Services makes the planning and establishment grants available, the
California Health and Human Services Agency shall, upon request of
the board, submit the initial application for planning and
establishment grants to the United States Secretary of Health and
Human Services.
   (2) If a majority of the board has not been appointed when the
United States Secretary of Health and Human Services makes the
planning and establishment grants available, the California Health
and Human Services Agency shall submit the initial application for
planning and establishment grants to the United States Secretary of
Health and Human Services. Any subsequent applications shall be made
as described in paragraph (1) once a majority of the members have
been appointed to the board.
   (3) The board shall be responsible for using the funds awarded by
the United States Secretary of Health and Human Services for the
planning and establishment of the Exchange, consistent with
subdivision (b) of Section 1311 of the federal act.
  SEC. 3.  Section 1346.2 is added to the Health and Safety Code, to
read:
   1346.2.  The director shall, in coordination with the Insurance
Commissioner, review the Internet portal developed by the United
States Secretary of Health and Human Services under subdivision (a)
of Section 1103 of the federal Patient Protection and Affordable Care
Act (Public Law 111-148) and paragraph (5) of subdivision (c) of
Section 1311 of that act, and any enhancements to that portal
expected to be implemented by the secretary on or before January 1,
2015. The review shall examine whether the Internet portal provides
sufficient information regarding all health benefit products offered
by health care service plans and health insurers in the individual
and small employer markets in California to facilitate fair and
affirmative marketing of all individual and small employer products,
particularly outside the California Health Benefit Exchange created
under Title 22 (commencing with Section 100500) of the Government
Code. If the director and the Insurance Commissioner jointly
determine that the Internet portal does not adequately achieve those
purposes, they shall jointly develop and maintain an electronic
clearinghouse to achieve those purposes. In performing this function,
the director and the Insurance Commissioner shall routinely monitor
individual and small employer benefit filings with, and complaints
submitted by individuals and small employers to, their respective
departments, and shall use any other available means to maintain the
clearinghouse.
  SEC. 4.  Section 10112.4 is added to the Insurance Code, to read:
   10112.4.  The commissioner shall, in coordination with the
Director of the Department of Managed Health Care, review the
Internet portal developed by the United States Secretary of Health
and Human Services under subdivision (a) of Section 1103 of the
federal Patient Protection and Affordable Care Act (Public Law
111-148) and paragraph (5) of subdivision (c) of Section 1311 of that
act, and any enhancements to that portal expected to be implemented
by the secretary on or before January 1, 2015. The review shall
examine whether the Internet portal provides sufficient information
regarding all health benefit products offered by health care service
plans and health insurers in the individual and small employer
markets in California to facilitate fair and affirmative marketing of
all individual and small employer products, particularly outside the
Health Benefit Exchange created under Title 22 (commencing with
Section 100500) of the Government Code. If the commissioner and the
Director of the Department of Managed Health Care jointly determine
that the Internet portal does not adequately achieve those purposes,
they shall jointly develop and maintain an electronic clearinghouse
to achieve those purposes. In performing this function, the
commissioner and the Director of the Department of Managed Health
Care shall routinely monitor individual and small employer benefit
filings with, and complaints submitted by individuals and small
employers to, their respective departments, and shall use any other
available means to maintain the clearinghouse.
  SEC. 5.  This act shall become operative only if Assembly Bill 1602
of the 2009-10 Regular Session is also enacted and becomes
operative.