California Legislature—2013–14 Regular Session

Assembly BillNo. 369


Introduced by Assembly Member Pan

February 14, 2013


An act to amend Section 100503 of the Government Code, relating to health care coverage.

LEGISLATIVE COUNSEL’S DIGEST

AB 369, as introduced, Pan. California Health Benefit Exchange: report.

Under the federal Patient Protection and Affordable Care Act (PPACA), each state is required, by January 1, 2014, to establish an American Health Benefit Exchange that makes available qualified health plans to qualified individuals and small employers. Existing state law establishes the California Health Benefit Exchange (Exchange) within state government, specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans through the Exchange by qualified individuals and small employers by January 1, 2014. Existing law requires the board to report, or contract with an independent entity to report, to the Legislature by December 1, 2018, on whether to adopt the option under the PPACA to merge the individual and small employer insurance markets.

This bill would instead require the board or the independent entity to make this report to the Legislature by March 1, 2019.

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1

SECTION 1.  

Section 100503 of the Government Code is
2amended to read:

3

100503.  

In addition to meeting the minimum requirements of
4Section 1311 of the federal act, the board shall do all of the
5following:

6(a) Determine the criteria and process for eligibility, enrollment,
7and disenrollment of enrollees and potential enrollees in the
8Exchange and coordinate that process with the state and local
9government entities administering other health care coverage
10programs, including the State Department of Health Care Services,
11the Managed Risk Medical Insurance Board, and California
12counties, in order to ensure consistent eligibility and enrollment
13processes and seamless transitions between coverage.

14(b) Develop processes to coordinate with the county entities
15that administer eligibility for the Medi-Cal program and the entity
16that determines eligibility for the Healthy Families Program,
17including, but not limited to, processes for case transfer, referral,
18and enrollment in the Exchange of individuals applying for
19assistance to those entities, if allowed or required by federal law.

20(c) Determine the minimum requirements a carrier must meet
21to be considered for participation in the Exchange, and the
22standards and criteria for selecting qualified health plans to be
23offered through the Exchange that are in the best interests of
24qualified individuals and qualified small employers. The board
25shall consistently and uniformly apply these requirements,
26standards, and criteria to all carriers. In the course of selectively
27contracting for health care coverage offered to qualified individuals
28and qualified small employers through the Exchange, the board
29shall seek to contract with carriers so as to provide health care
30coverage choices that offer the optimal combination of choice,
31value, quality, and service.

32(d) Provide, in each region of the state, a choice of qualified
33health plans at each of the five levels of coverage contained in
34subdivisions (d) and (e) of Section 1302 of the federal act.

35(e) Require, as a condition of participation in the Exchange,
36carriers to fairly and affirmatively offer, market, and sell in the
37Exchange at least one product within each of the five levels of
38coverage contained in subdivisions (d) and (e) of Section 1302 of
P3    1the federal act. The board may require carriers to offer additional
2products within each of those five levels of coverage. This
3subdivision shall not apply to a carrier that solely offers
4supplemental coverage in the Exchange under paragraph (10) of
5subdivision (a) of Section 100504.

6(f) (1) Require, as a condition of participation in the Exchange,
7carriers that sell any products outside the Exchange to do both of
8the following:

9(A) Fairly and affirmatively offer, market, and sell all products
10made available to individuals in the Exchange to individuals
11purchasing coverage outside the Exchange.

12(B) Fairly and affirmatively offer, market, and sell all products
13made available to small employers in the Exchange to small
14employers purchasing coverage outside the Exchange.

15(2) For purposes of this subdivision, “product” does not include
16contracts entered into pursuant to Part 6.2 (commencing with
17Section 12693) of Division 2 of the Insurance Code between the
18Managed Risk Medical Insurance Board and carriers for enrolled
19Healthy Families beneficiaries or contracts entered into pursuant
20to Chapter 7 (commencing with Section 14000) of, or Chapter 8
21(commencing with Section 14200) of, Part 3 of Division 9 of the
22Welfare and Institutions Code between the State Department of
23Health Care Services and carriers for enrolled Medi-Cal
24beneficiaries.

25(g) Determine when an enrollee’s coverage commences and the
26extent and scope of coverage.

27(h) Provide for the processing of applications and the enrollment
28and disenrollment of enrollees.

29(i) Determine and approve cost-sharing provisions for qualified
30health plans.

31(j) Establish uniform billing and payment policies for qualified
32health plans offered in the Exchange to ensure consistent
33enrollment and disenrollment activities for individuals enrolled in
34the Exchange.

35(k) Undertake activities necessary to market and publicize the
36availability of health care coverage and federal subsidies through
37the Exchange. The board shall also undertake outreach and
38enrollment activities that seek to assist enrollees and potential
39enrollees with enrolling and reenrolling in the Exchange in the
40least burdensome manner, including populations that may
P4    1experience barriers to enrollment, such as the disabled and those
2with limited English language proficiency.

3(l) Select and set performance standards and compensation for
4navigators selected under subdivision (l) of Section 100502.

5(m) Employ necessary staff.

6(1) The board shall hire a chief fiscal officer, a chief operations
7officer, a director for the SHOP Exchange, a director of Health
8 Plan Contracting, a chief technology and information officer, a
9general counsel, and other key executive positions, as determined
10by the board, who shall be exempt from civil service.

11(2) (A) The board shall set the salaries for the exempt positions
12described in paragraph (1) and subdivision (i) of Section 100500
13in amounts that are reasonably necessary to attract and retain
14individuals of superior qualifications. The salaries shall be
15published by the board in the board’s annual budget. The board’s
16annual budget shall be posted on the Internet Web site of the
17Exchange. To determine the compensation for these positions, the
18board shall cause to be conducted, through the use of independent
19outside advisors, salary surveys of both of the following:

20(i) Other state and federal health insurance exchanges that are
21most comparable to the Exchange.

22(ii) Other relevant labor pools.

23(B) The salaries established by the board under subparagraph
24(A) shall not exceed the highest comparable salary for a position
25of that type, as determined by the surveys conducted pursuant to
26subparagraph (A).

27(C) The Department of Human Resources shall review the
28methodology used in the surveys conducted pursuant to
29subparagraph (A).

30(3) The positions described in paragraph (1) and subdivision (i)
31of Section 100500 shall not be subject to otherwise applicable
32provisions of the Government Code or the Public Contract Code
33and, for those purposes, the Exchange shall not be considered a
34state agency or public entity.

35(n) Assess a charge on the qualified health plans offered by
36carriers that is reasonable and necessary to support the
37development, operations, and prudent cash management of the
38Exchange. This charge shall not affect the requirement under
39Section 1301 of the federal act that carriers charge the same
P5    1premium rate for each qualified health plan whether offered inside
2or outside the Exchange.

3(o) Authorize expenditures, as necessary, from the California
4Health Trust Fund to pay program expenses to administer the
5Exchange.

6(p) Keep an accurate accounting of all activities, receipts, and
7expenditures, and annually submit to the United States Secretary
8of Health and Human Services a report concerning that accounting.
9Commencing January 1, 2016, the board shall conduct an annual
10audit.

11(q) (1) Annually prepare a written report on the implementation
12and performance of the Exchange functions during the preceding
13fiscal year, including, at a minimum, the manner in which funds
14were expended and the progress toward, and the achievement of,
15the requirements of this title. This report shall be transmitted to
16the Legislature and the Governor and shall be made available to
17the public on the Internet Web site of the Exchange. A report made
18to the Legislature pursuant to this subdivision shall be submitted
19pursuant to Section 9795.

20(2) In addition to the report described in paragraph (1), the board
21shall be responsive to requests for additional information from the
22Legislature, including providing testimony and commenting on
23proposed state legislation or policy issues. The Legislature finds
24and declares that activities including, but not limited to, responding
25to legislative or executive inquiries, tracking and commenting on
26legislation and regulatory activities, and preparing reports on the
27implementation of this title and the performance of the Exchange,
28are necessary state requirements and are distinct from the
29promotion of legislative or regulatory modifications referred to in
30subdivision (d) of Section 100520.

31(r) Maintain enrollment and expenditures to ensure that
32expenditures do not exceed the amount of revenue in the fund, and
33if sufficient revenue is not available to pay estimated expenditures,
34institute appropriate measures to ensure fiscal solvency.

35(s) Exercise all powers reasonably necessary to carry out and
36comply with the duties, responsibilities, and requirements of this
37begin delete actend deletebegin insert titleend insert and the federal act.

38(t) Consult with stakeholders relevant to carrying out the
39activities under this title, including, but not limited to, all of the
40following:

P6    1(1) Health care consumers who are enrolled in health plans.

2(2) Individuals and entities with experience in facilitating
3enrollment in health plans.

4(3) Representatives of small businesses and self-employed
5individuals.

6(4) The State Medi-Cal Director.

7(5) Advocates for enrolling hard-to-reach populations.

8(u) Facilitate the purchase of qualified health plans in the
9Exchange by qualified individuals and qualified small employers
10no later than January 1, 2014.

11(v) Report, or contract with an independent entity to report, to
12the Legislature bybegin delete December 1, 2018,end deletebegin insert March 1, 2019,end insert on whether
13to adopt the option in paragraph (3) of subdivision (c) of Section
141312 of the federal act to merge the individual and small employer
15markets. In its report, the board shall provide information, based
16on at least two years of data from the Exchange, on the potential
17impact on rates paid by individuals and by small employers in a
18merged individual and small employer market, as compared to the
19rates paid by individuals and small employers if a separate
20individual and small employer market is maintained. A report
21made pursuant to this subdivision shall be submitted pursuant to
22Section 9795.

23(w) With respect to the SHOP Program, collect premiums and
24administer all other necessary and related tasks, including, but not
25limited to, enrollment and plan payment, in order to make the
26offering of employee plan choice as simple as possible for qualified
27small employers.

28(x) Require carriers participating in the Exchange to immediately
29notify the Exchange, under the terms and conditions established
30by the boardbegin insert,end insert when an individual is or will be enrolled in or
31disenrolled from any qualified health plan offered by the carrier.

32(y) Ensure that the Exchange provides oral interpretation
33services in any language for individuals seeking coverage through
34the Exchange and makes available a toll-free telephone number
35for the hearing and speech impaired. The board shall ensure that
36written information made available by the Exchange is presented
37in a plainly worded, easily understandable format and made
38available in prevalent languages.



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