Amended in Assembly June 26, 2013

Amended in Senate May 28, 2013

Amended in Senate April 8, 2013

Amended in Senate March 13, 2013

Senate Bill No. 138

Introduced by Senator Hernandez

(Coauthors: Senators DeSaulnier and Leno)

January 28, 2013

An act to amend Sections 56.05, 56.104, and 56.16 of, and to add Section 56.107 to, the Civil Code, to amend Sections 1280.15, 1627, 117928, 120985, 121010, and 130201 of, and to add Section 1348.5 to, the Health and Safety Code, to add Section 791.29 to the Insurance Code, and to amend Section 3208.05 of the Labor Code, relating to medical information.

LEGISLATIVE COUNSEL’S DIGEST

SB 138, as amended, Hernandez. Confidentiality of medical information.

Existing federal law, the Health Insurance Portability and Accountability Act of 1996 (HIPAA), establishes certain requirements relating to the provision of health insurance, and the protection of privacy of individually identifiable health information.

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 and makes a willful violation of its provisions a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance.

Existing law, the Confidentiality of Medical Information Act, provides that medical information, as defined, may not be disclosed by providers of health care, health care service plans, or contractors, as defined, without the patient’s written authorization, subject to certain exceptions, including disclosure to a probate court investigator, as specified. A violation of the act resulting in economic loss or personal injury to a patient is a misdemeanor and subjects the violating party to liability for specified damages and administrative fines and penalties. The act defines various terms relevant to its implementation.

This bill would declare the intent of the Legislature to incorporate HIPAA standards into state law and to clarify standards for protecting the confidentiality of medical information in insurance transactions. The bill would define additional terms in connection with maintaining the confidentiality of this information, including begin delete an “authorization for insurance communications,” end delete begin insert a end insert begin insert “confidential communications request” end insert which an insured individual may submit for the purpose of specifying begin delete disclosable medical information and insurance transactions, and permissible recipients end delete begin insert the method for transmitting insurance communications end insert .

This bill would specify the manner in which a health care service plan or health insurer would be required to maintain confidentiality of begin insert medical end insert information regarding the treatment of insured individuals begin delete less than 26 years of age end delete begin insert that involves sensitive services, as defined, including such treatment of those individuals end insert who are insured begin insert or covered end insert as dependents on another person’s begin delete policy, the treatment of an insured individual involving sensitive services, as defined, or end delete begin insert health care service plan or health insurance policy. The bill would require a health care service plan or health insurer to comply with a nondisclosure reuest or a confidential communications request from an insured individual, as defined, in end insert situations in which disclosure would endanger the insured begin delete individual, as defined end delete begin insert individual end insert .

This bill would specifically authorize a provider of health care to communicate information regarding benefit cost-sharing arrangements to the health care service plan or health insurer, as specified.

This bill would also prohibit the health care service plan or health insurer from conditioning enrollment in the plan or eligibility for benefits on the provision of an authorization for insurance communications. The bill also would make conforming technical changes. By expanding the scope of a crime, the bill would create a state-mandated local program.

Existing law, the Insurance Information and Privacy Protection Act, generally regulates how insurers collect, use, and disclose information gathered in connection with insurance transactions.

This bill would require a health care services plan or a health insurer, as defined, to comply with the requirements of the Confidentiality of Medical Information Act, if that act conflicts with the Insurance Information and Privacy Protection Act, as specified. Because a willful violation of these provisions by a health care service plan would be a crime, this bill would thus 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.  

The Legislature finds and declares all of the
following:

(a) Privacy is a fundamental right of all Californians, protected
by the California Constitution, the federal Health Insurance
Portability and Accountability Act (HIPAA; Public Law 104-191),
and the Confidentiality of Medical Information Act, Part 2.6
(commencing with Section 56) of Division 1 of the Civil Code.

(b) Implementation of the recently enacted federal Patient
Protection and Affordable Care Act (Public Law 111-148) will
expand the number of individuals insured as dependents on a health
insurance policy held in another person’s name, including adult
children under 26 years of age insured on a parent’s insurance
policy.

(c) HIPAA explicitly protects the confidentiality of medical
care obtained by dependents insured under a health insurance
policy held by another person.

(d) Therefore, it is the intent of the Legislature in enacting this
act to incorporate HIPAA standards into state law and to clarify
the standards for protecting the confidentiality of medical
information in insurance transactions.

SEC. 2.  

Section 56.05 of the Civil Code is amended to read:

56.05.  

For purposes of this part:

(a) “Authorization” means permission granted in accordance
with Section 56.11 or 56.21 for the disclosure of medical
information.

begin delete

(b) “Authorization for insurance communications” means
permission from the individual, that meets the requirements of
subdivisions (a) to (c), inclusive, of Section 56.11, specifying the
medical information and insurance transactions that may be
disclosed and the identity of the people to whom disclosures are
permitted as part of an insurance communication.

(c)

end delete

begin insert (b) end insert  “Authorized recipient” means any person who is authorized
to receive medical information pursuant to Section 56.10 or 56.20.

begin delete

(d)

end delete

begin insert (c) end insert  “Confidential communications request” means a request by
an insured individual that insurance communications be
communicated by a specific method, such as by telephone, email,
or in a covered envelope rather than postcard, or to a specific mail
or email address or specific telephone number, as designated by
the insured individual.

begin delete

(e)

end delete

begin insert (d) end insert  “Contractor” means any person or entity that is a medical
group, independent practice association, pharmaceutical benefits
manager, or a medical service organization and is not a health care
service plan or provider of health care. “Contractor” does not
include insurance institutions as defined in subdivision (k) of
Section 791.02 of the Insurance Code or pharmaceutical benefits
managers licensed pursuant to the Knox-Keene Health Care Service
Plan Act of 1975 (Chapter 2.2 (commencing with Section 1340)
of Division 2 of the Health and Safety Code).

begin delete

(f)

end delete

begin insert (e) end insert  “Endanger” means that the insured individual fears
harassment or abuse resulting from an insurance communication
sufficient to deter the patient from obtaining health care absent
confidentiality.

begin delete

(g)

end delete

begin insert (f) end insert  “Health care service plan” means any entity regulated
pursuant to the Knox-Keene Health Care Service Plan Act of 1975
(Chapter 2.2 (commencing with Section 1340) of Division 2 of
the Health and Safety Code).

begin delete

(h)

end delete

begin insert (g) end insert  “Health insurer” means an entity that issues health insurance,
as defined in subdivision (b) of Section 106 of the Insurance Code.

begin delete

(i)

end delete

begin insert (h) end insert  “Insured individual” means a person entitled to coverage
under a health care service plan or health insurer, including the
policyholder begin insert , enrollee, end insert and dependents.

begin delete

(j)

end delete

begin insert (i) end insert  “Insurance communication” means any communication from
the health care service plan or health insurer to begin delete policyholders or end delete
insured individuals that discloses individually identifiable medical
information. Insurance communication includes, but is not limited
to, explanation of benefits forms, scheduling information, notices
of denial, and notices of contested claims.

begin delete

(k)

end delete

begin insert (j) end insert  “Licensed health care professional” means any person
licensed or certified pursuant to Division 2 (commencing with
Section 500) of the Business and Professions Code, the Osteopathic
Initiative Act or the Chiropractic Initiative Act, or Division 2.5
(commencing with Section 1797) of the Health and Safety Code.

begin delete

(l)

end delete

begin insert (k) end insert  “Marketing” means to make a communication about a
product or service that encourages recipients of the communication
to purchase or use the product or service.

“Marketing” does not include any of the following:

(1) Communications made orally or in writing for which the
communicator does not receive direct or indirect remuneration,
including, but not limited to, gifts, fees, payments, subsidies, or
other economic benefits, from a third party for making the
communication.

(2) Communications made to current enrollees solely for the
purpose of describing a provider’s participation in an existing
health care provider network or health plan network of a
Knox-Keene licensed health plan to which the enrollees already
subscribe; communications made to current enrollees solely for
the purpose of describing if, and the extent to which, a product or
service, or payment for a product or service, is provided by a
provider, contractor, or plan or included in a plan of benefits of a
Knox-Keene licensed health plan to which the enrollees already
subscribe; or communications made to plan enrollees describing
the availability of more cost-effective pharmaceuticals.

(3) Communications that are tailored to the circumstances of a
particular individual to educate or advise the individual about
treatment options, and otherwise maintain the individual’s
adherence to a prescribed course of medical treatment, as provided
in Section 1399.901 of the Health and Safety Code, for a chronic
and seriously debilitating or life-threatening condition as defined
in subdivisions (d) and (e) of Section 1367.21 of the Health and
Safety Code, if the health care provider, contractor, or health plan
receives direct or indirect remuneration, including, but not limited
to, gifts, fees, payments, subsidies, or other economic benefits,
from a third party for making the communication, if all of the
following apply:

(A) The individual receiving the communication is notified in
the communication in typeface no smaller than 14-point type of
the fact that the provider, contractor, or health plan has been
remunerated and the source of the remuneration.

(B) The individual is provided the opportunity to opt out of
receiving future remunerated communications.

(C) The communication contains instructions in typeface no
smaller than 14-point type describing how the individual can opt
out of receiving further communications by calling a toll-free
number of the health care provider, contractor, or health plan
making the remunerated communications. No further
communication may be made to an individual who has opted out
after 30 calendar days from the date the individual makes the opt
out request.

begin delete

(m)

end delete

begin insert (l) end insert  “Medical information” means any individually identifiable
information, in electronic or physical form, in possession of or
derived from a provider of health care, health care service plan,
pharmaceutical company, or contractor regarding a patient’s
medical history, mental or physical condition, or treatment.
“Individually identifiable” means that the medical information
includes or contains any element of personal identifying
information sufficient to allow identification of the individual,
such as the patient’s name, address, electronic mail address,
telephone number, or social security number, or other information
that, alone or in combination with other publicly available
information, reveals the individual’s identity.

begin delete

(n)

end delete

begin insert (m) end insert  “Nondisclosure request” means a written request to withhold
insurance communications that includes the insured individual’s
name and address, description of the medical or other information
that should not be disclosed, identity of the persons from whom
information shall be withheld, and contact information for the
individual for additional information or clarification necessary to
satisfy the request.

begin delete

(o)

end delete

begin insert (n) end insert  “Patient” means any natural person, whether or not still
living, who received health care services from a provider of health
care and to whom medical information pertains.

begin delete

(p)

end delete

begin insert (o) end insert  “Pharmaceutical company” means any company or business,
or an agent or representative thereof, that manufactures, sells, or
distributes pharmaceuticals, medications, or prescription drugs.
“Pharmaceutical company” does not include a pharmaceutical
benefits manager, as included in subdivision (c), or a provider of
health care.

begin delete

(q)

end delete

begin insert (p) end insert  “Provider of health care” means any person licensed or
certified pursuant to Division 2 (commencing with Section 500)
of the Business and Professions Code; any person licensed pursuant
to the Osteopathic Initiative Act or the Chiropractic Initiative Act;
any person certified pursuant to Division 2.5 (commencing with
Section 1797) of the Health and Safety Code; any clinic, health
dispensary, or health facility licensed pursuant to Division 2
(commencing with Section 1200) of the Health and Safety Code.
“Provider of health care” does not include insurance institutions
as defined in subdivision (k) of Section 791.02 of the Insurance
Code.

begin delete

(r)

end delete

begin insert (q) end insert  “Sensitive services” means all health care services described
in Sections 6924, 6925, 6926, 6927, 6928, and 6929 of the Family
Code, and Sections 121020 and 124260 of the Health and Safety
Code, obtained by any patient who has reached the minimum age
specified for consenting to the service specified in the section,
including patients 18 years of age and older.

SEC. 3.  

Section 56.104 of the Civil Code is amended to read:

56.104.  

(a) Notwithstanding subdivision (c) of Section 56.10,
except as provided in subdivision (e), no provider of health care,
health care service plan, or contractor may release medical
information to persons or entities who have requested that
information and who are authorized by law to receive that
information pursuant to subdivision (c) of Section 56.10, if the
requested information specifically relates to the patient’s
participation in outpatient treatment with a psychotherapist, unless
the person or entity requesting that information submits to the
patient pursuant to subdivision (b) and to the provider of health
care, health care service plan, or contractor a written request, signed
by the person requesting the information or an authorized agent
of the entity requesting the information, that includes all of the
following:

(1) The specific information relating to a patient’s participation
in outpatient treatment with a psychotherapist being requested and
its specific intended use or uses.

(2) The length of time during which the information will be
kept before being destroyed or disposed of. A person or entity may
extend that timeframe, provided that the person or entity notifies
the provider, plan, or contractor of the extension. Any notification
of an extension shall include the specific reason for the extension,
the intended use or uses of the information during the extended
time, and the expected date of the destruction of the information.

(3) A statement that the information will not be used for any
purpose other than its intended use.

(4) A statement that the person or entity requesting the
information will destroy the information and all copies in the
person’s or entity’s possession or control, will cause it to be
destroyed, or will return the information and all copies of it before
or immediately after the length of time specified in paragraph (2)
has expired.

(b) The person or entity requesting the information shall submit
a copy of the written request required by this section to the patient
within 30 days of receipt of the information requested, unless the
patient has signed a written waiver in the form of a letter signed
and submitted by the patient to the provider of health care or health
care service plan waiving notification.

(c) For purposes of this section, “psychotherapist” means a
person who is both a “psychotherapist” as defined in Section 1010
of the Evidence Code and a “provider of health care” as defined
in Section 56.05.

(d) This section does not apply to the disclosure or use of
medical information by a law enforcement agency or a regulatory
agency when required for an investigation of unlawful activity or
for licensing, certification, or regulatory purposes, unless the
disclosure is otherwise prohibited by law.

(e) This section shall not apply to any of the following:

(1) Information authorized to be disclosed pursuant to paragraph
(1) of subdivision (c) of Section 56.10.

(2) Information requested from a psychotherapist by law
enforcement or by the target of the threat subsequent to a disclosure
by that psychotherapist authorized by paragraph (19) of subdivision
(c) of Section 56.10, in which the additional information is clearly
necessary to prevent the serious and imminent threat disclosed
under that paragraph.

(3) Information disclosed by a psychotherapist pursuant to
paragraphs (14) and (22) of subdivision (c) of Section 56.10 and
requested by an agency investigating the abuse reported pursuant
to those paragraphs.

(f) Nothing in this section shall be construed to grant any
additional authority to a provider of health care, health care service
plan, or contractor to disclose information to a person or entity
without the patient’s consent.

SEC. 4.  

Section 56.107 is added to the Civil Code, to read:

56.107.  

(a) Notwithstanding any other law, and to the extent
permitted by federal law, a health care service plan or health insurer
shall take the following steps to protect the confidentiality of an
insured individual’s medical information as follows:

(1)  begin delete A end delete begin insert For an insured individual who is insured or covered as
a dependent on another person’s health care service plan or health
insurance policy, a end insert health care service plan or health insurer shall
not send insurance communications relating to sensitive begin delete services: end delete

begin delete (A) Unless the health care service plan or health insurer has
received an authorization for insurance communications from an
insured individual who is under 26 years of age and insured as a
dependent on another person’s insurance policy. end delete begin insert services, unless
the insurance communication is required by federal law. If required
by federal law, the insurance communication shall comply with
either of the following: end insert

begin insert

(A) The health care service plan or health insurer shall send
the required insurance communication to the insured individual
in compliance with a confidential communications request received
from the insured individual.

end insert begin insert

(B) If the health care service plan or health insurer has not
received a confidential communications request, it shall send the
required insurance communication to the insured individual, and
may do so at the address furnished by the policyholder.

end insert begin delete

(B)

end delete

begin insert (2) end insert  For an insured individual to whom begin delete subparagraph (A) end delete
begin insert paragraph (1) end insert does not apply, begin insert a health care service plan or health
insurer shall not send the insurance communication related to
sensitive services end insert if that insured individual has submitted a
nondisclosure request.

begin delete

(2) A health care service plan or health insurer shall comply
with a confidential communications request regarding sensitive
services from an insured individual.

end delete

(3) A health care service plan or health insurer shall comply
with a nondisclosure request or a confidential communications
request from an insured individual who states that disclosure of
medical information will endanger the individual, and shall not
require an explanation as to the basis for the insured individual’s
statement that disclosure will endanger the individual.

begin insert

(b) For the purposes of this section, a confidential
communications request or a nondisclosure request is deemed
received by the health care service plan or the health insurer within
24 hours of electronic transmission or within 72 hours of posting
by first class mail.

end insert begin delete

(b)

end delete

begin insert (c) end insert  Notwithstanding subdivision (a), the provider of health care
may make arrangements with the insured individual for the
payment of benefit cost sharing and communicate that arrangement
with the health care service plan or health insurer.

begin delete

(c)

end delete

begin insert (d) end insert  A health care service plan or health insurer shall not
condition enrollment or coverage in the health plan or health
insurance policy or eligibility for benefits on the provision of an
authorization for insurance communications.

SEC. 5.  

Section 56.16 of the Civil Code is amended to read:

56.16.  

For disclosures not addressed by Section 56.1007, unless
there is a specific written request by the patient to the contrary,
nothing in this part shall be construed to prevent a general acute
care hospital, as defined in subdivision (a) of Section 1250 of the
Health and Safety Code, upon an inquiry concerning a specific
patient, from releasing at its discretion any of the following
information: the patient’s name, address, age, and sex; a general
description of the reason for treatment (whether an injury, a burn,
poisoning, or some unrelated condition); the general nature of the
injury, burn, poisoning, or other condition; the general condition
of the patient; and any information that is not medical information
as defined in Section 56.05.

SEC. 6.  

Section 1280.15 of the Health and Safety Code is
amended to read:

1280.15.  

(a) A clinic, health facility, home health agency, or
hospice licensed pursuant to Section 1204, 1250, 1725, or 1745
shall prevent unlawful or unauthorized access to, and use or
disclosure of, patients’ medical information, as defined in Section
56.05 of the Civil Code and consistent with Section 130203. For
purposes of this section, internal paper records, electronic mail,
or facsimile transmissions inadvertently misdirected within the
same facility or health care system within the course of
coordinating care or delivering services shall not constitute
unauthorized access to, or use or disclosure of, a patient’s medical
information. The department, after investigation, may assess an
administrative penalty for a violation of this section of up to
twenty-five thousand dollars ($25,000) per patient whose medical
information was unlawfully or without authorization accessed,
used, or disclosed, and up to seventeen thousand five hundred
dollars ($17,500) per subsequent occurrence of unlawful or
unauthorized access, use, or disclosure of that patient’s medical
information. For purposes of the investigation, the department
shall consider the clinic’s, health facility’s, agency’s, or hospice’s
history of compliance with this section and other related state and
federal statutes and regulations, the extent to which the facility
detected violations and took preventative action to immediately
correct and prevent past violations from recurring, and factors
outside its control that restricted the facility’s ability to comply
with this section. The department shall have full discretion to
consider all factors when determining the amount of an
administrative penalty pursuant to this section.

(b) (1) A clinic, health facility, home health agency, or hospice
to which subdivision (a) applies shall report any unlawful or
unauthorized access to, or use or disclosure of, a patient’s medical
information to the department no later than five business days after
the unlawful or unauthorized access, use, or disclosure has been
detected by the clinic, health facility, home health agency, or
hospice.

(2) Subject to subdivision (c), a clinic, health facility, home
health agency, or hospice shall also report any unlawful or
unauthorized access to, or use or disclosure of, a patient’s medical
information to the affected patient or the patient’s representative
at the last known address, no later than five business days after
the unlawful or unauthorized access, use, or disclosure has been
detected by the clinic, health facility, home health agency, or
hospice.

(c) (1) A clinic, health facility, home health agency, or hospice
shall delay the reporting, as required pursuant to paragraph (2) of
subdivision (b), of any unlawful or unauthorized access to, or use
or disclosure of, a patient’s medical information beyond five
business days if a law enforcement agency or official provides the
clinic, health facility, home health agency, or hospice with a written
or oral statement that compliance with the reporting requirements
of paragraph (2) of subdivision (b) would likely impede the law
enforcement agency’s investigation that relates to the unlawful or
unauthorized access to, and use or disclosure of, a patient’s medical
information and specifies a date upon which the delay shall end,
not to exceed 60 days after a written request is made, or 30 days
after an oral request is made. A law enforcement agency or official
may request an extension of a delay based upon a written
declaration that there exists a bona fide, ongoing, significant
criminal investigation of serious wrongdoing relating to the
unlawful or unauthorized access to, and use or disclosure of, a
patient’s medical information, that notification of patients will
undermine the law enforcement agency’s investigation, and that
specifies a date upon which the delay shall end, not to exceed 60
days after the end of the original delay period.

(2) If the statement of the law enforcement agency or official
is made orally, then the clinic, health facility, home health agency,
or hospice shall do both of the following:

(A) Document the oral statement, including, but not limited to,
the identity of the law enforcement agency or official making the
oral statement and the date upon which the oral statement was
made.

(B) Limit the delay in reporting the unlawful or unauthorized
access to, or use or disclosure of, the patient’s medical information
to the date specified in the oral statement, not to exceed 30 calendar
days from the date that the oral statement is made, unless a written
statement that complies with the requirements of this subdivision
is received during that time.

(3) A clinic, health facility, home health agency, or hospice
shall submit a report that is delayed pursuant to this subdivision
not later than five business days after the date designated as the
end of the delay.

(d) If a clinic, health facility, home health agency, or hospice
to which subdivision (a) applies violates subdivision (b), the
department may assess the licensee a penalty in the amount of one
hundred dollars ($100) for each day that the unlawful or
unauthorized access, use, or disclosure is not reported to the
department or the affected patient, following the initial five-day
period specified in subdivision (b). However, the total combined
penalty assessed by the department under subdivision (a) and this
subdivision shall not exceed two hundred fifty thousand dollars
($250,000) per reported event. For enforcement purposes, it shall
be presumed that the facility did not notify the affected patient if
the notification was not documented. This presumption may be
rebutted by a licensee only if the licensee demonstrates, by a
preponderance of the evidence, that the notification was made.

(e) In enforcing subdivisions (a) and (d), the department shall
take into consideration the special circumstances of small and rural
hospitals, as defined in Section 124840, and primary care clinics,
as defined in subdivision (a) of Section 1204, in order to protect
access to quality care in those hospitals and clinics. When assessing
a penalty on a skilled nursing facility or other facility subject to
Section 1423, 1424, 1424.1, or 1424.5, the department shall issue
only the higher of either a penalty for the violation of this section
or a penalty for violation of Section 1423, 1424, 1424.1, or 1424.5,
not both.

(f) All penalties collected by the department pursuant to this
section, Sections 1280.1, 1280.3, and 1280.4, shall be deposited
into the Internal Departmental Quality Improvement Account,
which is hereby created within the Special Deposit Fund under
Section 16370 of the Government Code. Upon appropriation by
the Legislature, moneys in the account shall be expended for
internal quality improvement activities in the Licensing and
Certification Program.

(g) If the licensee disputes a determination by the department
regarding a failure to prevent or failure to timely report unlawful
or unauthorized access to, or use or disclosure of, patients’ medical
information, or the imposition of a penalty under this section, the
licensee may, within 10 days of receipt of the penalty assessment,
request a hearing pursuant to Section 131071. Penalties shall be
paid when appeals have been exhausted and the penalty has been
upheld.

(h) In lieu of disputing the determination of the department
regarding a failure to prevent or failure to timely report unlawful
or unauthorized access to, or use or disclosure of, patients’ medical
information, transmit to the department 75 percent of the total
amount of the administrative penalty, for each violation, within
30 business days of receipt of the administrative penalty.

(i) Notwithstanding any other law, the department may refer
violations of this section to the Office of Health Information
Integrity for enforcement pursuant to Section 130303.

(j) For purposes of this section, the following definitions shall
apply:

(1) “Reported event” means all breaches included in any single
report that is made pursuant to subdivision (b), regardless of the
number of breach events contained in the report.

(2) “Unauthorized” means the inappropriate access, review, or
viewing of patient medical information without a direct need for
medical diagnosis, treatment, or other lawful use as permitted by
the Confidentiality of Medical Information Act (Part 2.6
(commencing with Section 56) of Division 1 of the Civil Code)
or any other statute or regulation governing the lawful access, use,
or disclosure of medical information.

SEC. 7.  

Section 1348.5 is added to the Health and Safety Code,
to read:

1348.5.  

(a) A health care service plan shall comply with the
provisions of Section 56.107 of the Civil Code to the extent
required by that section. To the extent this chapter conflicts with
Section 56.107 of the Civil Code, the provisions of Section 56.107
of the Civil Code shall control.

(b) The department shall review health care service plan
contracts and privacy policies for compliance with this section
only during the normal application approval or modification
process conducted pursuant to Sections 1351 and 1352.

SEC. 8.  

Section 1627 of the Health and Safety Code is amended
to read:

1627.  

(a) (1) On or before July 1, 2011, the University of
California is requested to develop a plan to establish and administer
the Umbilical Cord Blood Collection Program for the purpose of
collecting units of umbilical cord blood for public use in
transplantation and providing nonclinical units for research
pertaining to biology and new clinical utilization of stem cells
derived from the blood and tissue of the placenta and umbilical
cord. The program shall conclude no later than January 1, 2018.

(2) For purposes of this article, “public use” means both of the
following:

(A) The collection of umbilical cord blood units from genetically
diverse donors that will be owned by the University of California.
This inventory shall be accessible by the National Registry and by
qualified California-based and other United States and international
registries and transplant centers to increase the likelihood of
providing suitably matched donor cord blood units to patients or
research participants who are in need of a transplant.

(B) Cord blood units with a lower number of cells than deemed
necessary for clinical transplantation and units that meet clinical
requirements, but for other reasons are unsuitable, unlikely to be
transplanted, or otherwise unnecessary for clinical use, may be
made available for research.

(b) (1) In order to implement the collection goals of this
program, the University of California may, commensurate with
available funds appropriated to the University of California for
this program, contract with one or more selected applicant entities
that have demonstrated the competence to collect and ship cord
blood units in compliance with federal guidelines and regulations.

(2) It is the intent of the Legislature that, if the University of
California contracts with another entity pursuant to this subdivision,
the following shall apply:

(A) The University of California may use a competitive process
to identify the best proposals submitted by applicant entities to
administer the collection and research objectives of the program,
to the extent that the University of California chooses not to
undertake these activities itself.

(B) In order to qualify for selection under this section to receive,
process, cryopreserve, or bank cord blood units, the entity shall,
at a minimum, have obtained an investigational new drug (IND)
exemption from the FDA or a biologic license from the FDA, as
appropriate, to manufacture clinical grade cord blood stem cell
units for clinical indications.

(C) In order to qualify to receive appropriate cord blood units
and placental tissue to advance the research goals of this program,
an entity shall, at a minimum, be a laboratory recognized as having
performed peer-reviewed research on stem and progenitor cells,
including those derived from placental or umbilical cord blood
and postnatal tissue.

(3) A medical provider or research facility shall comply with,
and shall be subject to, existing penalties for violations of all
applicable state and federal laws with respect to the protection of
any medical information, as defined in Section 56.05 of the Civil
Code, and any personally identifiable information contained in the
umbilical cord blood inventory.

(c) The University of California is encouraged to make every
effort to avoid duplication or conflicts with existing and ongoing
programs and to leverage existing resources.

(d) (1) All information collected pursuant to the program shall
be confidential, and shall be used solely for the purposes of the
program, including research. Access to confidential information
shall be limited to authorized persons who are bound by appropriate
institutional policies or who otherwise agree, in writing, to maintain
the confidentiality of that information.

(2) Any person who, in violation of applicable institutional
policies or a written agreement to maintain confidentiality,
discloses any information provided pursuant to this section, or
who uses information provided pursuant to this section in a manner
other than as approved pursuant to this section, may be denied
further access to any confidential information maintained by the
University of California, and shall be subject to a civil penalty not
exceeding one thousand dollars ($1,000). The penalty provided
for in this section shall not be construed to limit or otherwise
restrict any remedy, provisional or otherwise, provided by law for
the benefit of the University of California or any other person
covered by this section.

(3) Notwithstanding the restrictions of this section, an individual
to whom the confidential information pertains shall have access
to his or her own personal information.

(e) It is the intent of the Legislature that the plan and
implementation of the program provide for both of the following:

(1) Limit fees for access to cord blood units to the reasonable
and actual costs of storage, handling, and providing units, as well
as for related services such as donor matching and testing of cord
blood and other programs and services typically provided by cord
blood banks and public use programs.

(2) The submittal of the plan developed pursuant to subdivision
(a) to the health and fiscal committees of the Legislature.

(f) It is additionally the intent of the Legislature that the plan
and implementation of the program attempt to provide for all of
the following:

(1) Development of a strategy to increase voluntary participation
by hospitals in the collection and storage of umbilical cord blood
and identify funding sources to offset the financial impact on
hospitals.

(2) Consideration of a medical contingency response program
to prepare for and respond effectively to biological, chemical, or
radiological attacks, accidents, and other public health emergencies
where victims potentially benefit from treatment.

(3) Exploration of the feasibility of operating the program as a
self-funding program, including the potential for charging users a
reimbursement fee.

SEC. 9.  

Section 117928 of the Health and Safety Code is
amended to read:

117928.  

(a)  Any common storage facility for the collection
of medical waste produced by small quantity generators operating
independently, but sharing common storage facilities, shall have
a permit issued by the enforcement agency.

(b)  A permit for any common storage facility specified in
subdivision (a) may be obtained by any one of the following:

(1)  A provider of health care as defined in Section 56.05 of the
Civil Code.

(2)  The registered hazardous waste transporter.

(3)  The property owner.

(4)  The property management firm responsible for providing
tenant services to the medical waste generators.

SEC. 10.  

Section 120985 of the Health and Safety Code is
amended to read:

120985.  

(a)  Notwithstanding Section 120980, the results of
an HIV test that identifies or provides identifying characteristics
of the person to whom the test results apply may be recorded by
the physician who ordered the test in the test subject’s medical
record or otherwise disclosed without written authorization of the
subject of the test, or the subject’s representative as set forth in
Section 121020, to the test subject’s providers of health care, as
defined in Section 56.05 of the Civil Code, for purposes of
diagnosis, care, or treatment of the patient, except that for purposes
of this section, “providers of health care” does not include a health
care service plan regulated pursuant to Chapter 2.2 (commencing
with Section 1340) of Division 2.

(b)  Recording or disclosure of HIV test results pursuant to
subdivision (a) does not authorize further disclosure unless
otherwise permitted by law.

SEC. 11.  

Section 121010 of the Health and Safety Code is
amended to read:

121010.  

Notwithstanding Section 120975 or 120980, the results
of a blood test to detect antibodies to the probable causative agent
of AIDS may be disclosed to any of the following persons without
written authorization of the subject of the test:

(a) To the subject of the test or the subject’s legal representative,
conservator, or to any person authorized to consent to the test
pursuant to subdivision (b) of Section 120990.

(b) To a test subject’s provider of health care, as defined in
Section 56.05 of the Civil Code, except that for purposes of this
section, “provider of health care” does not include a health care
service plan regulated pursuant to Chapter 2.2 (commencing with
Section 1340) of Division 2.

(c) To an agent or employee of the test subject’s provider of
health care who provides direct patient care and treatment.

(d) To a provider of health care who procures, processes,
distributes, or uses a human body part donated pursuant to the
Uniform Anatomical Gift Act (Chapter 3.5 (commencing with
Section 7150) of Part 1 of Division 7).

(e) (1) To the designated officer of an emergency response
employee, and from that designated officer to an emergency
response employee regarding possible exposure to HIV or AIDS,
but only to the extent necessary to comply with provisions of the
Ryan White Comprehensive AIDS Resources Emergency Act of
1990 (Public Law 101-381; 42 U.S.C. Sec. 201).

(2) For purposes of this subdivision, “designated officer” and
“emergency response employee” have the same meaning as these
terms are used in the Ryan White Comprehensive AIDS Resources
Emergency Act of 1990 (Public Law 101-381; 42 U.S.C. Sec.
201).

(3) The designated officer shall be subject to the confidentiality
requirements specified in Section 120980, and may be personally
liable for unauthorized release of any identifying information about
the HIV results. Further, the designated officer shall inform the
exposed emergency response employee that the employee is also
subject to the confidentiality requirements specified in Section
120980, and may be personally liable for unauthorized release of
any identifying information about the HIV test results.

SEC. 12.  

Section 130201 of the Health and Safety Code is
amended to read:

130201.  

For purposes of this division, the following definitions
apply:

(a) “Director” means the Director of the Office of Health
Information Integrity.

(b) “Medical information” means the term as defined in Section
56.05 of the Civil Code.

(c) “Office” means the Office of Health Information Integrity.

(d) “Provider of health care” means the term as defined in
Sections 56.05 and 56.06 of the Civil Code.

(e) “Unauthorized access” means the inappropriate review or
viewing of patient medical information without a direct need for
diagnosis, treatment, or other lawful use as permitted by the
Confidentiality of Medical Information Act (Part 2.6 (commencing
with Section 56) of Division 1 of the Civil Code) or by other
statutes or regulations governing the lawful access, use, or
disclosure of medical information.

SEC. 13.  

Section 791.29 is added to the Insurance Code, to
read:

791.29.  

(a) A health insurer, as defined in subdivision (h) of
Section 56.05 of the Civil Code, shall comply with the provisions
of Section 56.107 of the Civil Code to the extent required by that
section. To the extent this article conflicts with Section 56.107 of
the Civil Code, the provisions of Section 56.107 of the Civil Code
shall control.

(b) The department shall review insurance products and privacy
policies for compliance with this section only during the normal
policy issuance process conducted pursuant to Sections 10290 and
10291.

SEC. 14.  

Section 3208.05 of the Labor Code is amended to
read:

3208.05.  

(a) “Injury” includes a reaction to or a side effect
arising from health care provided by an employer to a health care
worker, which health care is intended to prevent the development
or manifestation of any bloodborne disease, illness, syndrome, or
condition recognized as occupationally incurred by Cal-OSHA,
the federal Centers for Disease Control and Prevention, or other
appropriate governmental entities. This section shall apply only
to preventive health care that the employer provided to a health
care worker under the following circumstances: (1) prior to an
exposure because of risk of occupational exposure to such a
disease, illness, syndrome, or condition, or (2) where the preventive
care is provided as a consequence of a documented exposure to
blood or bodily fluid containing blood that arose out of and in the
course of employment. Such a disease, illness, syndrome, or
condition includes, but is not limited to, hepatitis, and the human
immunodeficiency virus. Such preventive health care, and any
disability indemnity or other benefits required as a result of the
preventive health care provided by the employer, shall be
compensable under the workers’ compensation system. The
employer may require the health care worker to document that the
employer provided the preventive health care and that the reaction
or side effects arising from the preventive health care resulted in
lost work time, health care costs, or other costs normally
compensable under workers’ compensation.

(b) The benefits of this section shall not be provided to a health
care worker for a reaction to or side effect from health care
intended to prevent the development of the human
immunodeficiency virus if the worker claims a work-related
exposure and if the worker tests positive within 48 hours of that
exposure to a test to determine the presence of the human
immunodeficiency virus.

(c) For purposes of this section, “health care worker” includes
any person who is an employee of a provider of health care as
defined in Section 56.05 of the Civil Code, and who is exposed to
human blood or other bodily fluids contaminated with blood in
the course of employment, including, but not limited to, a registered
nurse, a licensed vocational nurse, a certified nurse aide, clinical
laboratory technologist, dental hygienist, physician, janitor, and
housekeeping worker. “Health care worker” does not include an
employee who provides employee health services for an employer
primarily engaged in a business other than providing health care.

SEC. 15.  

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.