BILL NUMBER: AB 1800 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 6, 2012
AMENDED IN SENATE JUNE 26, 2012
AMENDED IN ASSEMBLY MAY 25, 2012
AMENDED IN ASSEMBLY MAY 1, 2012
AMENDED IN ASSEMBLY MARCH 20, 2012
INTRODUCED BY Assembly Member Ma
FEBRUARY 21, 2012
An act to amend Section 1367 of, and to add Section 1367.006 to,
the Health and Safety Code, and to add Section 10123.197.5 to the
Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 1800, as amended, Ma. Health care coverage.
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
that the willful violation of provisions regulating health care
service plans is a crime. Existing law provides for the licensing and
regulation of health insurers by the Insurance Commissioner.
Existing law requires health care service plans and health insurers
to provide certain benefits, but generally does not require plans and
insurers to cover prescription drugs.
Existing law imposes various requirements on plans and insurers
if they offer coverage for prescription drugs. Existing law, with
respect to health care service plans, authorizes a plan to file
information with the department to seek the approval of, among other
things, a copayment, deductible, or exclusion to a plan's
prescription drug benefit and specifies that an approved exclusion
shall not be subject to review through the independent medical review
process on the grounds of medical necessity.
Existing federal law, the Patient Protection and Affordable Care
Act, commencing January 1, 2014, imposes an annual limitation on cost
sharing incurred under a health plan that shall not exceed a
specified amount.
This bill would, commencing January 1, 2014, require a health care
service plan contract and a health insurance policy, except for a
specialized plan or policy, to provide for a limit on annual
out-of-pocket expenses for certain covered benefits, except as
specified, and would provide that this limit shall not exceed that
federal limit. The bill would also provide, commencing January 1,
2014, that these provisions shall not be construed to affect the
reduction in cost sharing for eligible insureds described in federal
law.
Existing law provides that the obligation of a plan to comply with
specified standards is not waived when the plan delegates any
services that it is required to perform to its medical groups,
independent practice associations, or other contracting entities.
This bill would apply those provisions regarding waiver to the
obligation of a plan to comply with the Knox-Keene Health Care
Service Plan Act of 1975, rather than to the obligation of the plan
to comply with specified standards.
Because this bill would impose new requirements on health care
service plans, the willful violation of which would be a crime, it
would thereby 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 1367 of the Health and Safety Code is amended
to read:
1367. A health care service plan and, if applicable, a
specialized health care service plan shall meet the following
requirements:
(a) Facilities located in this state including, but not limited
to, clinics, hospitals, and skilled nursing facilities to be utilized
by the plan shall be licensed by the State Department of Public
Health, where licensure is required by law. Facilities not located in
this state shall conform to all licensing and other requirements of
the jurisdiction in which they are located.
(b) Personnel employed by or under contract to the plan shall be
licensed or certified by their respective board or agency, where
licensure or certification is required by law.
(c) Equipment required to be licensed or registered by law shall
be so licensed or registered, and the operating personnel for that
equipment shall be licensed or certified as required by law.
(d) The plan shall furnish services in a manner providing
continuity of care and ready referral of patients to other providers
at times as may be appropriate consistent with good professional
practice.
(e) (1) All services shall be readily available at reasonable
times to each enrollee consistent with good professional practice. To
the extent feasible, the plan shall make all services readily
accessible to all enrollees consistent with Section 1367.03.
(2) To the extent that telemedicine
telehealth services are appropriately provided through
telemedicine telehealth , as defined in
subdivision (a) of Section 2290.5 of the Business and Professions
Code, these services shall be considered in determining compliance
with Section 1300.67.2 of Title 28 of the California Code of
Regulations.
(3) The plan shall make all services accessible and appropriate
consistent with Section 1367.04.
(f) The plan shall employ and utilize allied health manpower for
the furnishing of services to the extent permitted by law and
consistent with good medical practice.
(g) The plan shall have the organizational and administrative
capacity to provide services to subscribers and enrollees. The plan
shall be able to demonstrate to the department that medical decisions
are rendered by qualified medical providers, unhindered by fiscal
and administrative management.
(h) (1) Contracts with subscribers and enrollees, including group
contracts, and contracts with providers, and other persons furnishing
services, equipment, or facilities to or in connection with the
plan, shall be fair, reasonable, and consistent with the objectives
of this chapter. All contracts with providers shall contain
provisions requiring a fast, fair, and cost-effective dispute
resolution mechanism under which providers may submit disputes to the
plan, and requiring the plan to inform its providers upon
contracting with the plan, or upon change to these provisions, of the
procedures for processing and resolving disputes, including the
location and telephone number where information regarding disputes
may be submitted.
(2) A health care service plan shall ensure that a dispute
resolution mechanism is accessible to noncontracting providers for
the purpose of resolving billing and claims disputes.
(3) On and after January 1, 2002, a health care service plan shall
annually submit a report to the department regarding its dispute
resolution mechanism. The report shall include information on the
number of providers who utilized the dispute resolution mechanism and
a summary of the disposition of those disputes.
(i) A health care service plan contract shall provide to
subscribers and enrollees all of the basic health care services
included in subdivision (b) of Section 1345, except that the director
may, for good cause, by rule or order exempt a plan contract or any
class of plan contracts from that requirement. The director shall by
rule define the scope of each basic health care service that health
care service plans are required to provide as a minimum for licensure
under this chapter. Nothing in this chapter shall prohibit a health
care service plan from charging subscribers or enrollees a copayment
or a deductible for a basic health care service consistent with
Section 1367.005 1367.006 , provided
that the copayments or deductibles are reported to, and held
unobjectionable by, the director and set forth to the subscriber or
enrollee pursuant to the disclosure provisions of Section 1363.
(j) A health care service plan shall not require registration
under the federal Controlled Substances Act of 1970 (21 U.S.C. Sec.
801 et seq.) as a condition for participation by an optometrist
certified to use therapeutic pharmaceutical agents pursuant to
Section 3041.3 of the Business and Professions Code.
Nothing in this section shall be construed to permit the director
to establish the rates charged subscribers and enrollees for
contractual health care services.
The director's enforcement of Article 3.1 (commencing with Section
1357) shall not be deemed to establish the rates charged subscribers
and enrollees for contractual health care services.
The obligation of the plan to comply with this chapter shall not
be waived when the plan delegates any services that it is required to
perform to its medical groups, independent practice associations, or
other contracting entities.
SEC. 2. Section 1367.006 is added to the Health and Safety Code,
to read:
1367.006. (a) A health care service plan contract, except a
specialized health care service plan contract, that is issued,
amended, or renewed on or after January 1, 2014, shall provide for a
limit on annual out-of-pocket expenses for all covered benefits that
meet the definition of essential health benefits in paragraph (1) of
subdivision (a) of Section 1367.005.
(b) This limit shall apply to any copayment, coinsurance,
deductible, and any other form of cost sharing for all covered
benefits, including, but not limited to, outpatient prescription
drugs, that meet the definition of essential health benefits in
paragraph (1) of subdivision (a) of Section 1367.005.
(c) This limit shall not exceed the limit described in Section
1302(c) of the federal Patient Protection and Affordable Care Act, as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (42 U.S.C. Sec. 18022) and any subsequent rules, regulations,
or guidance issued under that section.
(d) Nothing in this section shall be construed to affect the
reduction in cost sharing for eligible insureds described in Section
1402 of the federal Patient Protection and Affordable Care Act, as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (42 U.S.C. Sec. 18071) and any subsequent rules, regulations,
or guidance issued under that section.
SEC. 3. Section 10123.197.5 is added to the Insurance Code, to
read:
10123.197.5. (a) A health insurance policy, except a specialized
health insurance policy, that is issued, amended, or renewed on or
after January 1, 2014, shall provide for a limit on annual
out-of-pocket expenses for all covered benefits that meet the
definition of essential health benefits in paragraph (1) of
subdivision (a) of Section 10112.27.
(b) This limit shall apply to any copayment, coinsurance,
deductible, and any other form of cost sharing for all covered
benefits, including, but not limited to, outpatient prescription
drugs, that meet the definition of essential health benefits in
paragraph (1) of subdivision (a) of Section 10112.27.
(c) This limit shall not exceed the limit described in Section
1302(c) of the federal Patient Protection and Affordable Care Act, as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (42 U.S.C. Sec. 18022) and any subsequent rules, regulations,
or guidance issued under that section.
(d) Nothing in this section shall be construed to affect the
reduction in cost sharing for eligible insureds described in Section
1402 of the federal Patient Protection and Affordable Care Act, as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (42 U.S.C. Sec. 18071) and any subsequent rules, regulations,
or guidance issued under that section.
SEC. 4. 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.