BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 353|
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THIRD READING
Bill No: SB 353
Author: Lieu (D)
Amended: 4/16/13
Vote: 21
SENATE HEALTH COMMITTEE : 7-2, 4/10/13
AYES: Hernandez, Beall, De León, DeSaulnier, Monning, Pavley,
Wolk
NOES: Anderson, Nielsen
SENATE APPROPRIATIONS COMMITTEE : 5 -2, 5/23/13
AYES: De León, Hill, Lara, Padilla, Steinberg
NOES: Walters, Gaines
SUBJECT : Health care coverage: language assistance
SOURCE : California Immigrant Policy Center
California Pan-Ethnic Health Network
Health Access California
DIGEST : This bill requires health plans and health insurers
(collectively referred to as carriers) that advertise, market,
or allow others to market or advertise on their behalf, in a
language other than English, to translate specified documents
into that language. Prohibits an insurer from publishing or
distributing, or allowing to be published or distributed on its
behalf, any advertisement unless specified conditions are met.
ANALYSIS : Existing law:
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1. Prohibits a health plan from publishing or distributing an
advertisement unless a copy thereof has first been filed with
the Director of the Department of Managed Health Care (DMHC)
at least 30 days prior to that use and the Director has not
found the advertisement to be untrue, misleading, deceptive,
or in violation of the Knox-Keene Act (Act) within those 30
days.
2. Authorizes the Director to require a plan to publish a
correction or retraction of an untrue, misleading, or
deceptive statement contained in the advertisement and to
prohibit the health plan from publishing the advertisement or
a material revision without filing a copy with the Director
if an advertisement fails to comply with the Act.
3. Authorizes the Director to exempt a health plan or an
advertisement from the requirements described above.
4. Prohibits a health plan, solicitor, solicitor firm, or
representative from using any advertising or solicitation, or
making or permitting the use of any verbal statement, that is
untrue or misleading or any form of evidence of coverage that
is deceptive.
5. Permits, under the Act, the Director to require that
solicitors, solicitor firms and principal persons engaged in
the supervision of solicitation for plans of solicitor firms
to meet such reasonable and appropriate standards with
respect to training, experience, and other qualifications as
the Director finds necessary and appropriate.
6. Defines, under the Insurance Code, unfair methods of
competition and unfair and deceptive acts or practices in the
business of insurance. Makes any person who engages in any
unfair method of competition or any unfair or deceptive act
or practice liable to the state for a civil penalty to be
fixed by the Commissioner of the Department of Insurance
(CDI), as defined.
7. Defines unfair methods of competition and unfair and
deceptive acts in in the business of insurance as making or
disseminating, or causing to be made or disseminated before
the publication any statement containing any assertion,
representation, or statement which is untrue, deceptive, or
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misleading, and which is known, or should be known, to be
untrue, deceptive, or misleading.
8. Requires each insurer to the extent required by the
Commissioner of the CDI, to file with copies of all printed
advertising the insurer proposes to disseminate in the state.
9. Requires DMHC and CDI to adopt regulations establishing
standards and requirements to provide enrollees and insureds
with appropriate access to language assistance in obtaining
health care services.
10.Requires carriers to translate specified documents into a
language when a certain proportion of its enrollees or
insureds indicate a preference for written materials in that
language. Requires carriers to complete an assessment of the
linguistic needs of its enrollee population and based on the
size and language needs assessment, determines its
"threshold" languages.
11.Requires carriers to report to the respective departments
their internal policies and procedures related to cultural
appropriateness.
This bill:
1. Requires a carrier that advertises, markets, or allows others
to market or advertise on its behalf, in a language other
than English, and which do not meet the minimum threshold
languages, to translate into that language all of the
following documents:
A. Welcome letters or notices of initial coverage, if
provided;
B. Applications for enrollment and any information
pertinent to eligibility or participation;
C. Notices advising limited-English-proficient (LEP)
persons of the availability of no-cost translation and
interpretation services;
D. Notices pertaining to the right and instructions on how
to file a grievance; and
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E. Uniform summaries of benefits of coverage.
2. Requires a carrier to use a trained and qualified translator
for all written translations of marketing and advertising
materials relating to health care service plan products, and
for all the documents listed in #1 above.
3. Prohibits an insurer from publishing or distributing, or
allowing to be published or distributed on its behalf, any
advertisement unless both of the following conditions are met
at least 30 days prior or any shorter period as CDI allows by
regulation:
A. A true copy of the advertisement has first been filed
with CDI; and
B. CDI has not found the advertisement, wholly or in part,
to be untrue, misleading, deceptive, or otherwise not in
compliance, and has specified any deficiencies within 30
days.
4. Allows an insurer that has been continuously licensed for the
preceding 18 months to publish or distribute, or allows to be
published or distributed on its behalf, an advertisement
without having filed it with CDI for prior approval, if the
insurer and the material comply with each of the following
conditions:
A. The advertisement or a material has not been previously
disapproved by CDI and the insurer reasonably believes
that the advertisement does not violate any rules; and
B. The insurer files a true copy of each new or materially
revised advertisement with CDI no later than 10 business
days after publication or distribution of the
advertisement.
5. Authorizes CDI to require the insurer to publish an approved
correction or retraction of any untrue, misleading, or
deceptive statement contained in the advertising.
6. Authorizes a health insurer, insurance agent, or other person
to file a written request for a hearing with CDI within 30
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days after receipt of any notice or order.
7. Authorizes CDI to develop regulations to classify plans and
advertisements as exempt from #3 and #4 described above.
Prohibits CDI from exempting new products or products offered
by insurers with a record within the past five years of
violations of these requirements.
Background
On March 23, 2010, President Obama signed the Patient Protection
Affordability Act (ACA). Among other provisions, the law makes
statutory changes affecting the regulation of and payment for
certain types of private health insurance. Beginning in 2014,
individuals will be required to maintain health insurance or pay
a penalty, with exceptions. As a result of implementation of
the ACA, it is estimated that three to seven million
Californians will be newly eligible for health insurance
starting in 2014.
Language assistance . SB 853 (Escutia, Chapter 713, Statutes of
2003) required DMHC to develop regulations that require health
plans to provide language assistance services, including certain
translation and interpretation services, to LEP enrollees. The
language assistance regulations require health plans to conduct
periodic enrollee assessments to evaluate the linguistic needs
of the enrollee population, maintain policies and procedures to
ensure that LEP enrollees are able to access language assistance
services, instruct staff on the use of the language assistance
services, and monitor the plan's operations and services to
ensure compliance with the language assistance regulations.
Plans must provide translation services for their identified
threshold languages as determined by the periodic enrollee
assessment and translate specified documents.
Health plans are required to place a notice of the availability
of language assistance services on all English versions of all
enrollment materials, all correspondence from the plan
confirming a new or renewed enrollment, brochures, newsletters,
outreach and marketing materials, and other materials routinely
disseminated to enrollees. Interpretation services are also
required to be provided to enrollees at all plan points of
contact where the enrollee might have need for such services.
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Health plans are required to provide interpretation services for
any language requested by an enrollee, irrespective of whether
the language is identified as one of the plan's threshold
languages.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
One-time costs of about $250,000 for the adoption of
regulations by the DMHC (Managed Care Fund).
One-time costs of $70,000 for review of health plan
contracts and other documents by the DMHC to ensure that
health plan policies comply with this bill's requirements
(Managed Care Fund).
Potential ongoing enforcement costs, likely in the tens of
thousands annually, based on complaints for violations of
this bill's requirements by health plans (Managed Care Fund).
One-time costs of $160,000 for the adoption of regulations
by the CDI (Insurance Fund).
Ongoing costs of about $580,000 per year for review of
insurance plan advertising materials and enforcement
activities by the CDI (Insurance Fund).
Potential minor impacts on the Medi-Cal managed care
program. In the state's Medi-Cal program, private managed
care plans provide coverage for about 5.2 million
beneficiaries. It is possible that those managed care plans
would see increased costs under this bill, to the extent that
they are doing direct to consumer marketing in non-English
languages. It is not clear how much direct to consumer
marketing these plans perform, so the amount of translation
services required under this bill is unknown. However, even
if this bill would impose some additional administrative
costs on Medi-Cal managed care plans, those plans may not be
able to recover those costs through their managed care
contracts negotiated with the state.
SUPPORT : (Verified 5/23/13)
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California Immigrant Policy Center (co-source)
California Pan-Ethnic Health Network (co-source)
Health Access California (co-source)
ACT for Women and Girls
AFSCME
American Cancer Society Cancer Action Network
Asian Americans for Civil Rights and Equality
Asian Pacific American Legal Center
California Black Health Network
California Communities United Institute
California Coverage and Health Initiatives
California Rural Legal Assistance Foundation
California School Employees Association
Cal-Islanders Humanitarian Association
Children's Partnership
Consumers Union
Earth Mama Healing, Inc.
Greenling Institute
Guam Communication Network
Street Level Health Project
United Nurses Association of California/Union of Health Care
Professionals
OPPOSITION : (Verified 5/23/13)
Association of California Life and Health Insurance Companies
California Association of Health Plans
California Chamber of Commerce
ARGUMENTS IN SUPPORT : This bill's sponsor, Health Access
California (HAC), writes that the Act provides numerous
protections for consumers enrolled in managed care plans
regulated by DMHC. HAC argues this bill extends prior approval
of marketing materials for health coverage to the Insurance
Code, and that this bill is needed to counter the flood of
misinformation about the ACA, its benefits and requirements.
The California Immigrant Policy Center writes that this bill
strengthens consumer protections for new health care enrollees
and protects them against potential fraudulent or deceptive
marketing practices. The California Pan-Ethnic Health Network
(CPEHN) writes that this bill seeks to build consumers' trust in
the system by strengthening consumer protections and closing
gaps in the current law. CPEHN states that this bill protects
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LEP enrollees by requiring critical enrollment information be
translated when carriers market in non-English languages and it
aligns the responsibilities of CDI with DMHC to review and
approve marketing materials.
ARGUMENTS IN OPPOSITION : The California Association of Health
Plans (CAHP) writes that this bill will increase costs and
administrative burdens on health plans trying to reach new
communities and inform them about coverage options available
through the ACA. CAHP writes that health plans already
routinely provide telephonic interpreter services and will
translate documents either verbally or in writing upon request
for those speaking a diverse range of languages. CAHP argues
that requiring health plans to translate many documents into
nonthreshold languages even if it publishes just one
advertisement or notice will be costly and could have the
unintended consequence of lessening plan outreach.
JL:k 5/25/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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