BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 369 (Pan) - Continuity of Care. Amended: February 18, 2014 Policy Vote: Health 7-0 Urgency: Yes Mandate: Yes Hearing Date: February 24, 2014 Consultant: Brendan McCarthy This bill does not meet the criteria for referral to the Suspense File. Bill Summary: AB 369, an urgency measure, would allow new enrollees in a health plan or health insurance policy to continue to receive treatment from their existing provider, if the enrollee's prior health care coverage was cancelled between December 1, 2013 and March 31, 2014. Fiscal Impact: One-time costs of about $120,000 in 2013-14 and $110,000 in 2014-15 to the Department of Insurance for enforcement and consumer assistance (Insurance Fund). One-time costs of about $15,000 in 2013-14 and $80,000 in 2014-15 to the Department of Managed Health Care for enforcement and consumer assistance (Managed Care Fund). No anticipated impact on the Medi-Cal program. Under current law and practice, Medi-Cal managed care plans are already required to provide continuity of care for new enrollees as would be required under this bill. Background: Under current law, health insurers are regulated by the Department of Insurance and health plans are regulated by the Department of Managed Health Care. Current law generally requires health insurers and managed care plans to provide "continuity of care" for enrollees who have certain medical conditions. Under this requirement, if an insurance policy or health plan terminates a contract with a medical provider, the insurer or health plan must continue to provide coverage for services provided by the terminated provider for specified time periods. Current law does not extend continuity of care requirements to newly covered enrollees who have an individual AB 369 (Pan) Page 1 subscriber agreement (i.e. a consumer who has bought a health plan in the individual market) or to enrollees in a health insurance plan. Proposed Law: AB 369 would allow new enrollees in a health plan or health insurance policy to continue to receive treatment from their existing provider, if the enrollee's prior health care coverage was cancelled between December 1, 2013 and March 31, 2014. Under the bill, insurers and health plans would be authorized to pay non-participating providers at the same rates and terms as a imposed on participating providers. If the provider does not wish to provide services under those terms and cannot agree to other terms with the insurer or health plan, the provider would not be obligated to continue to provide services under the bill. In cases where a new enrollee has a health insurance policy and the existing provider agrees to continue to provide care under the bill, the provider would have to accept payment from the insurer as payment in full for services. The provider would be prohibited from billing the patient for any amount in excess of the insurer's reimbursement rate, except for copayments and/or deductibles allowed under the insurance policy. This bill is an urgency measure. Related Legislation: AB 1507 (Logue) would allow an individual or small group health plan in effect on October 1, 2013 to be renewed until October 1, 2014 and remain in effect until December 31, 2014. That bill is in the Assembly. Staff Comments: The only costs that may be incurred by a local agency relate to crimes and infractions. Under the California Constitution, such costs are not reimbursable by the state.