BILL NUMBER: SB 42	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Alquist

                        DECEMBER 8, 2010

   An act to add Section 1349.5 to the Health and Safety Code,
relating to health care coverage.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 42, as introduced, Alquist. Health care service plans: shared
savings agreements.
   Existing law, the Knox-Keene Health Care Service Plan Act of 1975
(Knox-Keene Act), provides for the licensure and regulation of health
care service plans by the Department of Managed Health Care and
makes a willful violation of the act a crime. Existing law requires a
contract between a plan and a risk-bearing organization, as defined,
to include certain provisions concerning the administrative and
financial capacity of the risk-bearing organization, including a
requirement that the organization file quarterly and annual financial
surveys with the department.
   This bill would require a person that enters into a shared savings
agreement, or other risk or risk-sharing arrangement, related to the
provision of health care services to file the shared savings
agreement, or the agreement that forms the basis of the risk or
risk-sharing arrangement, and any other documents deemed appropriate
by the department, with the department for review to determine if the
person is subject to the Knox-Keene Act.
   Because a willful violation of this requirement would be a crime,
the bill would 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 1349.5 is added to the Health and Safety Code,
to read:
   1349.5.  (a) A person that enters into a shared savings agreement,
or other risk or risk-sharing arrangement, related to the provision
of health care services shall file the shared savings agreement, or
the agreement that forms the basis of the risk or risk-sharing
arrangement, and any other documents deemed appropriate by the
department, with the department for review to determine if the person
is subject to the requirements of this chapter.
   (b) For purposes of this section, "a person that enters into a
shared savings agreement, or other risk or risk-sharing arrangement,
related to the provision of health care services" includes, but is
not limited to, an accountable care organization that enters into a
shared savings agreement, or other risk or risk-sharing arrangement,
with the United States Secretary of Health and Human Services
pursuant to Section 1899 of Title XVIII of the federal Social
Security Act (42 U.S.C. Sec. 1395jjj).
  SEC. 2.  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.