BILL ANALYSIS                                                                                                                                                                                                    Ó



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          SENATE THIRD READING
          SB 353 (Lieu)
          As Amended September 4, 2013
          Majority vote

           SENATE VOTE  :26-11  
           
           HEALTH              13-5        APPROPRIATIONS      12-5        
           
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          |Ayes:|Pan, Ammiano, Atkins,     |Ayes:|Gatto, Bocanegra,         |
          |     |Bonilla, Bonta, Chesbro,  |     |Bradford,                 |
          |     |Gomez,                    |     |Ian Calderon, Campos,     |
          |     |Roger Hernández,          |     |Eggman, Gomez, Hall,      |
          |     |Lowenthal, Mitchell,      |     |Holden, Pan, Quirk, Weber |
          |     |Nazarian, V. Manuel       |     |                          |
          |     |Pérez, Wieckowski         |     |                          |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Maienschein, Mansoor,     |Nays:|Harkey, Bigelow,          |
          |     |Nestande, Wagner, Wilk    |     |Donnelly, Linder, Wagner  |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Requires the translation of specified documents by  
          trained and qualified translators when a health care service  
          plan, regulated by the Department of Managed Health Care (DMHC),  
          insurer, regulated by the California Department of Insurance  
          (CDI), or any other person or business markets or advertises  
          health insurance products in the individual or small group  
          markets in a non-English language that is not a threshold  
          language under existing law.  Specifically,  this bill  :

          1)Requires translation of the following documents using a  
            trained and qualified translator:

             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;








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             d)   Notices pertaining to the right to file a grievance and  
               instructions on how an enrollee may file a grievance; and,

             e)   Uniform summaries of benefits of coverage required by  
               the Patient Protection and Affordable Care Act (ACA) and  
               any rules or regulations promulgated thereunder.

          2)Requires any specialized plan or insurer that offers an  
            essential health benefit (EHB), as defined, but not any  
            specialized plan or insurer that does not offer an EHB, to  
            also translate the documents in 1) above when marketing or  
            advertising in non-English languages.

           EXISTING LAW  :

          1)Requires the translation of vital documents as follows:

             a)   Requires a health care service plan or insurer with an  
               enrollment of one million or more to translate vital  
               documents into the top two languages other than English, as  
               determined by the needs assessment, as required by existing  
               law and any additional languages when 0.75% or 15,000 of  
               the enrollee population, whichever number is less,  
               excluding Medi-Cal enrollment and treating Healthy Families  
               program (HFP) enrollment separately indicates a preference  
               for written materials in that language;

             b)   Requires a health care service plan or insurer with an  
               enrollment of 300,000 or more but less than one million to  
               translate vital documents into the top one language other  
               than English as determined by the needs assessment and any  
               additional languages when 1% or 6,000 of the enrollee  
               population, whichever number is less, excluding Medi-Cal  
               enrollment and treating HFP enrollment separately indicates  
               a preference for written materials in that language; and,

             c)   Requires a health care service plan or insurer with an  
               enrollment of less than 300,000 to translate vital  
               documents into a language other than English when 3,000 or  
               more or 5% of the enrollee population, whichever number is  
               less, excluding Medi-Cal enrollment and treating HFP  
               enrollment separately indicates a preference for written  
               materials in that language.








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          2)Specifies as vital documents that are required to be  
            translated all of the following:

             a)   Applications;

             b)   Consent forms;

             c)   Letters containing important information regarding  
               eligibility and participation criteria;

             d)   Notices pertaining to the denial, reduction,  
               modification, or termination of services and benefits, and  
               the right to file a grievance or appeal; and,

             e)   Notices advising LEP persons of the availability of free  
               language assistance and other outreach materials that are  
               provided to enrollees.

           FISCAL EFFECT  :  According to the Assembly Appropriations  
          Committee, one-time costs of about $250,000 for the adoption of  
          regulations by 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 in the tens of thousands annually to CDI and  
          DMHC, based on complaints for violations of this bill's  
          requirements by health plans (Insurance Fund and Managed Care  
          Fund).  One-time costs of about $150,000 for the adoption of  
          regulations by CDI (Insurance Fund).

           COMMENTS  :  According to the author, the federal ACA has the  
          potential to cover 4-5million individuals who currently lack  
          access to health care coverage.  In the California Health  
          Benefit Exchange (Exchange), over two million people will be  
          eligible for subsidies to help them purchase health insurance.   
          The author states that consumer trust in the establishment and  
          operation of the Exchange is critical to its success.  The  
          opportunities for confusion, misinformation, and outright  
          deception about the individual mandate, employer requirements,  
          who is eligible for what type of coverage, and other provisions  
          of federal health reform will be considerable.  In particular,  
          low-income consumers, communities of color, and LEP individuals  
          as well as the small business owners in those communities are  








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          often the most preyed upon.  There are some existing protections  
          in the Knox-Keene Health Care Service Plan Act of 1975 and some  
          in the Insurance Code.  This legislation builds on those  
          protections to ensure consumers trust in the expansion of this  
          program and are protected against bad actors or unscrupulous  
          individuals.  

          Health Access California (HAC) writes in support that this bill  
          extends the prior approval of marketing materials for health  
          insurers using the same statutory language that has been in  
          place since 1975 for health plans.  Of major concern to sponsors  
          of this bill, the California Immigrant Policy Center, HAC, and  
          California Pan-Ethnic Health Network is the vulnerability of  
          immigrants and LEP individuals to deceptive marketing practices,  
          their unfamiliarity with the health insurance system, and likely  
          confusion about the individual mandate and eligibility rules.   
          The sponsors add that this bill requires a health plan or  
          insurer that markets in a language other than English to provide  
          a list of materials in that language so that the consumer  
          choosing coverage knows what he or she is buying, even if he or  
          she speaks a language other than English.

          The California Association of Health Plans (CAHP) and the  
          Association of California Life and Health Insurance Companies  
          (ACLHIC), in their opposition, argue that this bill could have  
          the unintended consequence of lessening outreach to underserved  
          communities because these requirements would not only  
          drastically increase marketing and advertising costs to  
          underserved communities, but would create delays in getting  
          these materials approved and add significant workload to CDI.   
          ACLHIC and CAHP explain that their members already routinely  
          provide interpreter services upon request, either by phone or in  
          writing, for individuals who speak languages beyond threshold  
          languages.  The California Association of Dental Plans (CADP) is  
          opposed to the inclusion of specialized plans offering EHBs.   
          CADP believes this would have a chilling effect on outreach  
          efforts to underserved communities.


           Analysis Prepared by  :    Teri Boughton / HEALTH / (916) 319-2097  



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