BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 138 (Hernandez) - Confidentiality of medical information.
          
          Amended: April 8, 2013          Policy Vote: Health 7-2,  
          Judiciary 5-2
          Urgency: No                     Mandate: Yes
          Hearing Date: April 29, 2013                            
          Consultant: Brendan McCarthy    
          
          This bill meets the criteria for referral to the Suspense File.
          
          
          Bill Summary: SB 138 would prohibit a health plan or health  
          insurer from sending communications to a policy holder regarding  
          sensitive health care services provided to an individual who is  
          under 26 years of age and is insured as a dependent on another  
          person's policy. The bill also prohibits sending communications  
          regarding sensitive services provided to an individual over 26  
          years of age, upon that person's request.

          Fiscal Impact: 
              One-time costs between $500,000 and $600,000 for review of  
              health plan contracts and other documents by the Department  
              of Managed Health Care to ensure that health plan privacy  
              policies comply with the bill's requirements (Managed Care  
              Fund).

              Potential ongoing enforcement costs, likely in the tens of  
              thousands annually, based on complaints for violations of  
              the bill's requirements by health plans (Managed Care Fund).

              One-time costs between $500,000 and $600,000 for review of  
              insurance plan contracts and other documents by the  
              Department of Insurance to ensure that health plan privacy  
              policies comply with the bill's requirements (Insurance  
              Fund). While the Department indicates that costs under the  
              bill are absorbable, the initial review of insurance plan  
              contracts and other documents to ensure compliance with the  
              bill will likely impose additional workload on the  
              Department. 

              Potential ongoing enforcement costs, likely in the tens of  
              thousands annually, based on complaints for violations of  








          SB 138 (Hernandez)
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              the bill's requirements by health insurers (Insurance Fund).

          Background: Current state law prohibits health care providers or  
          health plans from sharing medical information without a  
          patient's consent.

          Under current state law, health plans are regulated by the  
          Department of Managed Health Care and health insurers are  
          regulated by the Department of Insurance.

          Proposed Law: SB 138 would prohibit a health plan or health  
          insurer from sending communications to a policy holder regarding  
          sensitive health care services provided to an individual who is  
          under 26 years of age and is insured as a dependent on another  
          person's policy. 

          The bill also prohibits sending communications to a policy  
          holder regarding sensitive services provided to an individual  
          over 26 years of age who is insured as a dependent on another  
          person's policy, upon that person's request.

          The bill defines sensitive services as specified health care  
          services relating to HIV, family planning, drug and alcohol use,  
          and mental health.

          The bill permits a health care provider to make arrangements  
          with an insured individual for the payment of benefit  
          cost-sharing and permits the provider to communicate that  
          information to the appropriate health plan or health insurer.

          Staff Comments: The only local mandates imposed by the bill  
          relate to crimes or infractions and are not reimbursable by the  
          state under the California Constitution.