BILL NUMBER: SB 1182 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 18, 2014
AMENDED IN ASSEMBLY JUNE 30, 2014
AMENDED IN SENATE APRIL 10, 2014
INTRODUCED BY Senator Leno
FEBRUARY 20, 2014
An act to amend Sections 1374.8, 1385.03, and 1385.04 of the
Health and Safety Code, and to amend Sections 791.27 and 10181.4 of
the Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
SB 1182, as amended, Leno. Health care coverage: rate review.
Existing law, the federal Patient Protection and Affordable Care
Act (PPACA), requires the United States Secretary of Health and Human
Services to establish a process for the annual review of
unreasonable increases in premiums for health insurance coverage in
which health insurance issuers submit to the secretary and the
relevant state a justification for an unreasonable premium increase
prior to implementation of the increase. 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 the act a crime.
Existing law also provides for the regulation of health insurers by
the Department of Insurance. Existing law requires a health care
service plan or health insurer in the individual, small group, or
large group markets to file rate information with the Department of
Managed Health Care or the Department of Insurance. For individual
and small group contracts and policies, existing law requires a plan
or insurer to file rate information at least 60 days prior to
implementing a rate change and requires a plan or insurer to disclose
with each filing specified information by aggregate benefit
category. Existing law allows a health care service plan that
exclusively contracts with no more than 2 medical groups to provide
or arrange for professional medical services for enrollees of the
plan to meet this requirement by disclosing its actual trend
experience for the prior year using benefit categories that are the
same or similar to those used by other plans.
This bill would specify the benefit categories to be used for that
purpose and would make other related changes.
For large group plan contracts and policies, existing law requires
a plan or insurer to file rate information with the department at
least 60 days prior to implementing an unreasonable rate increase, as
defined in PPACA. Existing law requires the plan or insurer to also
disclose specified aggregate data with that rate filing.
This bill would instead require the plan or insurer to
file rate information with the department at least 60 days prior to
implementing a rate increase that exceeds 5% of the prior year's
rate. The bill would also require that the plan or insurer disclose
specified data for each rate filing that exceeds 5% of the prior year'
s rate for that group, including, but not limited to, company name
and contact information, annual rate, and average rate change
initially requested. revise the aggregate information
required to be provided with the rate filing described above,
including, among other things, total earned premiums, total
incurred claims, and average rate of increase for the rate year. The
bill would require a plan or insurer to disclose the methodologies
used to develop base rates and other specified information,
including, among other things, all of the base rates used for groups
in the large group market and all of the factors used to adjust the
base rates. The bill would also require a plan or insurer to provide
additional aggregate information regarding rate changes for the large
group market, including, among other things, the average monthly
rate implemented during the prior year and the average rate change
initially requested, as specified. The bill would require a
plan or insurer insurer, under certain
circumstances, to annually disclose additional aggregate data
for all products sold in the large group market
and to provide deidentified claims data at no charge to a large group
purchaser that requests the information and meets specified
conditions.
Existing law prohibits, with exceptions, a health care service
plan or health insurer from releasing any information to an employer
that would directly or indirectly indicate to the employer that an
employee is receiving or has received services from a health care
provider covered by the plan unless authorized to do so by the
employee.
This bill would exempt from the prohibition the release of
relevant information for the purposes set forth in the provisions
regarding the review of rate increases
changes .
Because a willful violation of the bill's requirements by a health
care service plan would be a crime, the bill would 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. Section 1374.8 of the Health and Safety Code is amended
to read:
1374.8. (a) A health care service plan shall not release any
information to an employer that would directly or indirectly indicate
to the employer that an employee is receiving or has received
services from a health care provider covered by the plan unless
authorized to do so by the employee. An insurer that has, pursuant to
an agreement, assumed the responsibility to pay compensation
pursuant to Article 3 (commencing with Section 3750) of Chapter 4 of
Part 1 of Division 4 of the Labor Code, shall not be considered an
employer for the purposes of this section.
(b) Nothing in this section prohibits a health care service plan
from releasing relevant information described in this section for the
purposes set forth in Chapter 12 (commencing with Section 1871) of
Part 2 of Division 1 of the Insurance Code.
(c) Nothing in this section prohibits a health care service plan
from releasing relevant information described in this section for the
purposes set forth in subdivision (f) (h)
of Section 1385.04.
SEC. 2. Section 1385.03 of the Health and Safety Code is amended
to read:
1385.03. (a) All health care service plans shall file with the
department all required rate information for individual and small
group health care service plan contracts at least 60 days prior to
implementing any rate change.
(b) A plan shall disclose to the department all of the following
for each individual and small group rate filing:
(1) Company name and contact information.
(2) Number of plan contract forms covered by the filing.
(3) Plan contract form numbers covered by the filing.
(4) Product type, such as a preferred provider organization or
health maintenance organization.
(5) Segment type.
(6) Type of plan involved, such as for profit or not for profit.
(7) Whether the products are opened or closed.
(8) Enrollment in each plan contract and rating form.
(9) Enrollee months in each plan contract form.
(10) Annual rate.
(11) Total earned premiums in each plan contract form.
(12) Total incurred claims in each plan contract form.
(13) Average rate change initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of change.
(16) Effective date of rate change.
(17) Number of subscribers or enrollees affected by each plan
contract form.
(18) The plan's overall annual medical trend factor assumptions in
each rate filing for all benefits and by aggregate benefit category,
including hospital inpatient, hospital outpatient, physician
services, prescription drugs and other ancillary services,
laboratory, and radiology. A plan may provide aggregated additional
data that demonstrates or reasonably estimates year-to-year cost
changes in specific benefit categories in the geographic regions
listed in Sections 1357.512 and 1399.855. A health plan that
exclusively contracts with no more than two medical groups in the
state to provide or arrange for professional medical services for the
enrollees of the plan shall instead disclose the amount of its
actual trend experience for the prior contract year by aggregate
benefit category, using service categories that are, to the maximum
extent possible, the same or similar to the benefit categories used
by other plans. For this purpose, benefit categories shall be those
specified in subdivision (e) subparagraph (A)
of paragraph (1) of subdivision (g) of Section
1385.04.
(19) The amount of the projected trend attributable to the use of
services, price inflation, or fees and risk for annual plan contract
trends by aggregate benefit category, such as hospital inpatient,
hospital outpatient, physician services, prescription drugs and other
ancillary services, laboratory, and radiology. A health plan that
exclusively contracts with no more than two medical groups in the
state to provide or arrange for professional medical services for the
enrollees of the plan shall instead disclose the amount of its
actual trend experience for the prior contract year by aggregate
service category, using service categories that are, to the maximum
extent possible, the same or similar to those used by other plans.
For this purpose, benefit categories shall be those specified in
subdivision (e) subparagraph (A) of paragraph
(1) of subdivision (g) of Section 1385.04.
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in enrollee cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in enrollee benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
1385.06.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(c) A health care service plan subject to subdivision (a) shall
also disclose the following aggregate data for all rate filings
submitted under this section in the individual and small group health
plan markets:
(1) Number and percentage of rate filings reviewed by the
following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Number of subscribers.
(E) Number of covered lives affected.
(2) The plan's average rate change by the following categories:
(A) Plan year.
(B) Segment type.
(C) Product type.
(3) Any cost containment and quality improvement efforts since the
plan's last rate filing for the same category of health benefit
plan. To the extent possible, the plan shall describe any significant
new health care cost containment and quality improvement efforts and
provide an estimate of potential savings together with an estimated
cost or savings for the projection period.
(d) The department may require all health care service plans to
submit all rate filings to the National Association of Insurance
Commissioners' System for Electronic Rate and Form Filing (SERFF).
Submission of the required rate filings to SERFF shall be deemed to
be filing with the department for purposes of compliance with this
section.
(e) A plan shall submit any other information required under
PPACA. A plan shall also submit any other information required
pursuant to any regulation adopted by the department to comply with
this article.
SEC. 3. Section 1385.04 of the Health and Safety Code is amended
to read:
1385.04. (a) For large group health care service plan contracts,
all health plans shall file with the department at least 60 days
prior to implementing any rate change all required rate information
for unreasonable rate increases that exceed 5
percent of the prior year's rate increases .
This filing shall be concurrent with the written notice described in
subdivision (a) of Section 1374.21.
(b) For large group rate filings, health plans shall submit all
information that is required by PPACA. A plan shall also submit any
other information required pursuant to any regulation adopted by the
department to comply with this article.
(c) A health care service plan subject to subdivision (a)
shall disclose for each rate filing that exceeds
5 percent of the prior year's rate for that group all of the
following: the following aggregate information for
rates in the large group market:
(1) Company name and contact information.
(2) Number of plan contract forms
contracts covered by the filing.
(3) Plan contract form numbers covered by the filing.
(4)
(3) Product type, such as a preferred provider
organization or health maintenance organization.
(5)
(4) Segment type.
(6)
(5) Type of plan involved, such as for profit or not
for profit.
(7)
(6) Whether the products are opened or closed.
(8) Enrollment in each plan contract and rating form.
(9) Enrollee months in each plan contract form.
(10) Annual rate.
(11)
(7) Total earned premiums in each plan
contract form .
(12)
(8) Total incurred claims in each plan
contract form .
(13) Average rate change initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of change.
(16) Effective date of rate change.
(9) Average rate of increase for the rate year.
(17)
(10) Number of subscribers or enrollees affected
by each plan contract form .
(d) A health care service plan shall disclose the methodology or
methodologies used to develop the base rate or rates and all of the
following information:
(1) The base rate for the groups in the large group market. If
more than one base rate is used by the plan, all of the base rates
shall be disclosed, as well as the types of groups to which different
base rates are applied.
(2) All factors used to adjust the base rate or rates including,
but not limited to, the following:
(A) Industry or occupation, if either is applicable.
(B) Age.
(C) Health status, medical condition, or claims experience.
(D) Tobacco use, if applicable.
(E) Alcohol use, if applicable.
(F) Any other factor used to adjust the base rate or rates, with a
description of the factor and an objective and scientifically valid
explanation, based on up-to-date statistical or actuarial data.
(3) Any variation in rate or rates based on geographic regions,
along with a description of the geographic regions used by the plan.
The description shall specify the applicable counties or, if counties
are split, the ZIP Codes, in each region.
(4) Any variation due to benefits covered in addition to basic
health care services as defined in subdivision (b) of Section 1345,
as well as a description of the benefits covered, such as
prescription drugs, durable medical equipment, or infertility
treatment, using the format specified in paragraph (3) of subdivision
(b) of Section 1363.
(5) Variations due to differences in benefit design arising from
differences in cost sharing, including copays, coinsurance,
deductibles, annual out-of-pocket limitations, or any other cost
sharing, using the format specified in paragraph (3) of subdivision
(b) of Section 1363.
(6) The actuarial value of products, including the number of
enrolled lives by the actuarial value tiers specified in paragraph
(2) of subdivision (e).
(7) Any other factors affecting the base rate not described here.
(8) The amount or proportion that each factor contributes to the
base rate. If the proportions do not add up to 100 percent, an
explanation of how the remaining portion of the base rate or rates
are derived.
(9) If a plan uses modified community rating for any segment of
the large group, such as new business or groups of a certain size,
the plan shall describe the modifications to community rating and the
market segments to which modified community rating applies.
(10) Any change from the prior year in methodology, factors, or
assumptions used to develop a base rate or rates.
(e) (1) The plan shall also provide the following aggregate
information regarding rate changes for the large group market:
(A) Average rate change during the prior year.
(B) Average monthly rate implemented during the prior year.
(C) Average rate change initially requested.
(D) A comparison of claims cost and rate of changes over time.
(E) Any changes in enrollee cost sharing over the prior year,
including the range of changes and the number and proportion of
enrollees affected.
(F) Any changes in enrollee benefits over the prior year,
including the number and proportion of enrollees affected.
(G) Any changes in administrative costs.
(2) The information described in paragraph (1) shall be
categorized by family composition, such as single, single plus one,
and family, or any other family composition as the plan may use. If
the plan uses an alternative family composition, it shall provide a
description of that family composition.
(3) The information described in paragraph (1) shall also be
categorized by actuarial value tier, using the following actuarial
value tiers:
(A) 90 to 100 percent.
(B) 80 to 89 percent.
(C) 70 to 79 percent.
(D) 60 to 69 percent.
(E) Under 60 percent, if any.
(f) The plan shall provide the following aggregate information
regarding trend factors used to develop the change in rate:
(18) The
(1) (A) The
plan's overall annual medical trend factor assumptions in
each rate filing for all benefits and by aggregate benefit
category, including hospital inpatient, hospital outpatient,
physician services, prescription drugs and other ancillary services,
laboratory, and radiology. A plan may provide aggregated
additional data that demonstrates or reasonably estimates
year-to-year cost changes in specific benefit categories in major
geographic regions of the state if rates vary by region. If rates
vary by region, the plan shall provide a description of the regions
used by the plan. A
(B) A health plan that
exclusively contracts with no more than two medical groups in the
state to provide or arrange for professional medical services for the
enrollees of the plan shall instead disclose the amount of its
actual trend experience for the prior contract year by aggregate
benefit category, using service categories that are, to the maximum
extent possible, the same or similar to the benefit categories used
by other plans. For this purpose, benefit categories shall be those
specified in subdivision (e) subparagraph (A)
of paragraph (1) of subdivision (g) .
(19)
(2) (A) The amount of the
projected trend attributable to the use of services, price inflation,
or fees and risk for annual plan contract trends by aggregate
benefit category, such as hospital inpatient, hospital outpatient,
physician services, prescription drugs and other ancillary services,
laboratory, and radiology. A
(B) A health plan that
exclusively contracts with no more than two medical groups in the
state to provide or arrange for professional medical services for the
enrollees of the plan shall instead disclose the amount of its
actual trend experience for the prior contract year by aggregate
service category, using service categories that are, to the maximum
extent possible, the same or similar to those used by other plans.
For this purpose, benefit categories shall be those specified in
subdivision (e) subparagraph (A) of paragraph
(1) of subdivision (g) .
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in enrollee cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in enrollee benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
1385.06.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(d) Except as provided in subdivision (e), a health care service
plan shall annually disclose the following aggregate data for all
products sold in the large group market:
(1) Plan year.
(2) Segment type.
(3) Product type.
(4) Number of subscribers.
(5) Number of covered lives affected.
(6) The plan's average rate change by the following:
(A) Plan year.
(B) Segment type.
(C) Product type.
(D) Benefit category, including, but not limited to, hospital,
medical, ancillary, and other benefit categories reported publicly
for individual and small employer rate filings.
(E) Trend attributable to cost and trend attributable to
utilization by benefit category.
(e) A
(g) In addition to the other
information required under this section, a health care service
plan that is unable to provide information on rate increases
change by benefit categories, as defined in
subdivision (d) of Section 1385.07, including, but not limited to,
hospital, outpatient medical, and mental health, or information on
trend attributable to cost and trend attributable to utilization by
benefit category pursuant to subdivision (d) of Section 1385.07
, shall annually disclose all of the following aggregate data
for its large group health care service plan contracts:
(1) (A) The plan's overall aggregate data demonstrating or
reasonably estimating year-to-year cost increases
change in the aggregate for large group rates by major
service category. The plan shall distinguish between the
increase change ascribed to the volume of
services provided and the increase ascribed to the cost of services
provided for those assumptions that shall include the following
categories:
(i) Hospital inpatient.
(ii) Outpatient visits.
(iii) Outpatient surgical or other procedures.
(iv) Professional medical.
(v) Mental health.
(vi) Substance abuse.
(vii) Skilled nursing facility, if covered.
(viii) Prescription drugs.
(ix) Other ancillary services.
(x) Laboratory.
(xi) Radiology or imaging.
(B) A plan may provide aggregated additional
aggregated data that demonstrate
demonstrates or reasonably estimate
estimates year-to-year cost increases
change in each of the specific service categories specified in
subparagraph (A) for each of the major geographic regions of the
state if any.
(2) The amount of projected trend attributable to the following
categories:
(A) Use of services by service and disease category.
(B) Capital investment.
(C) Community benefit expenditures, excluding bad debt and valued
at cost.
(3) The amount and proportion of costs attributed to contracting
medical groups that would not have been attributable as medical
losses if incurred by the health plan rather than the medical group.
(f)
(h) (1) A health care service plan shall annually
provide claims data at no charge to a large group purchaser if the
large group purchaser requests the information. The health care
service plan shall provide claims data that a qualified statistician
has determined are is
deidentified so that the claims data do does
not identify or do not provide a reasonable
basis from which to identify an individual.
(2) Information provided to a large group purchaser under this
subdivision is not subject to Section 1385.07.
(3) (A) If claims data are is not
available, the plan shall provide, at no charge to the purchaser, all
of the following:
(i) Deidentified data sufficient for the large group purchaser to
calculate the cost of obtaining similar services from other health
plans and evaluate cost-effectiveness by service and disease
category.
(ii) Deidentified patient-level data on demographics, prescribing,
encounters, inpatient services, outpatient services, and any other
data as may be required of the health plan to comply with risk
adjustment, reinsurance, or risk corridors pursuant to the federal
Patient Protection and Affordable Care Act (Public Law 111-148), as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (Public Law 111-152), and any rules, regulations, or guidance
issued thereunder pursuant to these acts
.
(iii) Deidentified patient-level data used to experience rate the
large group, including diagnostic and procedure coding and costs
assigned to each service.
(B) The health care service plan shall obtain a formal
determination from a qualified statistician that the data provided
pursuant to this paragraph have has
been deidentified so that the data do does
not identify or do not provide a reasonable
basis from which to identify an individual. The statistician shall
certify the formal determination in writing and shall, upon request,
provide the protocol used for deidentification to the department.
(4) Data provided pursuant to this subdivision shall only be
provided to a large group purchaser that meets both of the following
conditions:
(A) Is The large group purchaser is
able to demonstrate its ability to comply with state and federal
privacy laws.
(B) Is a The large group purchaser
that is either an employer with an enrollment of
greater than 1,000 covered lives or a multiemployer trust.
(g)
(i) The department may require all health care service
plans to submit all rate filings to the National Association of
Insurance Commissioners' System for Electronic Rate and Form Filing
(SERFF). Submission of the required rate filings to SERFF shall be
deemed to be filing with the department for purposes of compliance
with this section.
SEC. 4. Section 791.27 of the Insurance Code is amended to read:
791.27. (a) A disability insurer that provides coverage for
hospital, medical, or surgical expenses shall not release any
information to an employer that would directly or indirectly indicate
to the employer that an employee is receiving or has received
services from a health care provider covered by the plan unless
authorized to do so by the employee. An insurer that has, pursuant to
an agreement, assumed the responsibility to pay compensation
pursuant to Article 3 (commencing with Section 3750) of Chapter 4 of
Part 1 of Division 4 of the Labor Code, shall not be considered an
employer for the purposes of this section.
(b) Nothing in this section prohibits a disability insurer from
releasing relevant information described in this section for the
purposes set forth in Chapter 12 (commencing with Section 1871) of
Part 2 of Division 1.
(c) Nothing in this section prohibits a health insurer from
releasing relevant information described in this section for the
purposes set forth in subdivision (f) (h)
of Section 10181.4.
SEC. 5. Section 10181.4 of the Insurance Code is amended to read:
10181.4. (a) For large group health insurance policies, all
health insurers shall file with the department at least 60 days prior
to implementing any rate change all required rate information for
unreasonable rate increases that exceed 5 percent
of the prior year's rate increases . This
filing shall be concurrent with the written notice described in
Section 10199.1.
(b) For large group rate filings, health insurers shall submit all
information that is required by PPACA. A health insurer shall also
submit any other information required pursuant to any regulation
adopted by the department to comply with this article.
(c) A health insurer subject to subdivision (a)
shall disclose for each rate filing that exceeds 5 percent
of the prior year's rate for that group all of the following:
the following aggregate information for rates in the
large group market:
(1) Company name and contact information.
(2) Number of policy forms policies
covered by the filing.
(3) Policy form numbers covered by the filing.
(4)
(3) Product type, such as indemnity or preferred
provider organization.
(5)
(4) Segment type.
(6)
(5) Type of insurer involved, such as for profit or not
for profit.
(7)
(6) Whether the products are opened or closed.
(8) Enrollment in each policy and rating form.
(9) Insured months in each policy form.
(10) Annual rate.
(11)
(7) Total earned premiums in each policy form
.
(12)
(8) Total incurred claims in each policy form
.
(13) Average rate change initially requested.
(14) Review category: initial filing for new product, filing for
existing product, or resubmission.
(15) Average rate of change.
(16) Effective date of rate change.
(9) Average rate of increase for the rate year.
(17)
(10) Number of policyholders or insureds affected by
each policy form.
(d) A health insurer shall disclose the methodology or
methodologies used to develop the base rate or rates and all of the
following information:
(1) The base rate for the groups in the large group market. If
more than one base rate is used by the insurer, all of the base rates
shall be disclosed, as well as the types of groups to which
different base rates are applied.
(2) All factors used to adjust the base rate or rates including,
but not limited to, the following:
(A) Industry or occupation, if either is applicable.
(B) Age.
(C) Health status, medical condition, or claims experience.
(D) Tobacco use, if applicable.
(E) Alcohol use, if applicable.
(F) Any other factor used to adjust the base rate or rates, with a
description of the factor and an objective and scientifically valid
explanation, based on up-to-date statistical or actuarial data.
(3) Any variation in rate or rates based on geographic regions,
along with a description of the geographic regions used by the
insurer. The description shall specify the applicable counties or, if
counties are split, the ZIP Codes, in each region.
(4) Any variation due to benefits covered in addition to basic
health care services, as well as a description of the benefits
covered, such as prescription drugs, durable medical equipment, or
infertility treatment, using the format specified in paragraph (2) of
subdivision (a) of
Section 10603.
(5) Variations due to differences in benefit design arising from
differences in cost sharing, including copays, coinsurance,
deductibles, annual out-of-pocket limitations, or any other cost
sharing, using the format specified in paragraph (2) of subdivision
(a) of Section 10603.
(6) The actuarial value of products, including the number of
enrolled lives by the actuarial value tiers specified in paragraph
(3) of subdivision (e).
(7) Any other factors affecting the base rate not described here.
(8) The amount or proportion that each factor contributes to the
base rate. If the proportions do not add up to 100 percent, an
explanation of how the remaining portion of the base rate or rates
are derived.
(9) If an insurer uses modified community rating for any segment
of the large group, such as new business or groups of a certain size,
the insurer shall describe the modifications to community rating and
the market segments to which modified community rating applies.
(10) Any change from the prior year in methodology, factors, or
assumptions used to develop a base rate or rates.
(e) (1) The insurer shall also provide the following aggregate
information regarding rate changes for the large group market:
(A) Average rate change during the prior year.
(B) Average monthly rate implemented during the prior year.
(C) Average rate change initially requested.
(D) A comparison of claims cost and rate of changes over time.
(E) Any changes in insured cost sharing over the prior year,
including the range of changes and the number and proportion of
insureds affected.
(F) Any changes in insured benefits over the prior year, including
the number and proportion of insureds affected.
(G) Any changes in administrative costs.
(2) The information described in paragraph (1) shall be
categorized by family composition, such as single, single plus one,
and family, or any other family composition as the insurer may use.
If the insurer uses an alternative family composition, it shall
provide a description of that family composition.
(3) The information described in paragraph (1) shall also be
categorized by actuarial value tier, using the following actuarial
value tiers:
(A) 90 to 100 percent.
(B) 80 to 89 percent.
(C) 70 to 79 percent.
(D) 60 to 69 percent.
(E) Under 60 percent, if any.
(f) The insurer shall provide the following aggregate information
regarding trend factors used to develop the change in rate:
(18)
(1) (A) The insurer's overall
annual medical trend factor assumptions in each rate filing for all
benefits and by aggregate benefit category, including hospital
inpatient, hospital outpatient, physician services, prescription
drugs and other ancillary services, laboratory, and radiology.
An insurer may provide aggregated additional data that
demonstrates or reasonably estimates year-to-year cost changes in
specific benefit categories in major geographic regions of the state
if rates vary by region. If rates vary by region, the insurer shall
provide a description of the regions used by the insurer.
(B) An insurer that exclusively contracts with no more than two
medical groups in the state to provide or arrange for professional
medical services for its insureds shall instead disclose the amount
of its actual trend experience for the prior contract year by
aggregate benefit category, using service categories that are, to the
maximum extent possible, the same or similar to the benefit
categories used by other plans. For this purpose, benefit categories
shall be those specified in subparagraph (A) of paragraph (1) of
subdivision (g).
(19)
(2) (A) The amount of the
projected trend attributable to the use of services, price inflation,
or fees and risk for annual policy trends by aggregate benefit
category, such as hospital inpatient, hospital outpatient, physician
services, prescription drugs and other ancillary services,
laboratory, and radiology.
(B) A health insurer that exclusively contracts with no more than
two medical groups in the state to provide or arrange for
professional medical services for its insureds shall instead disclose
the amount of its actual trend experience for the prior contract
year by aggregate service category, using service categories that
are, to the maximum extent possible, the same or similar to those
used by other plans. For this purpose, benefit categories shall be
those specified in subparagraph (A) of paragraph (1) of subdivision
(g).
(20) A comparison of claims cost and rate of changes over time.
(21) Any changes in insured cost-sharing over the prior year
associated with the submitted rate filing.
(22) Any changes in insured benefits over the prior year
associated with the submitted rate filing.
(23) The certification described in subdivision (b) of Section
10181.6.
(24) Any changes in administrative costs.
(25) Any other information required for rate review under PPACA.
(d) Except as provided in subdivision (e), a health insurer shall
annually disclose the following aggregate data for all products sold
in the large group market:
(1) Policy year.
(2) Segment type.
(3) Product type.
(4) Number of policyholders.
(5) Number of covered lives affected.
(6) The insurer's average rate change by the following:
(A) Policy year.
(B) Segment type.
(C) Product type.
(D) Benefit category, including, but not limited to, hospital,
medical, ancillary, and other benefit categories reported publicly
for individual and small employer rate filings.
(E) Trend attributable to cost and trend attributable to
utilization by benefit category.
(e) A
(g) In addition to the other
information required under this section, a health insurer that
is unable to provide information on rate increases
change by benefit categories, as defined in subdivision
(d) of Section 10181.7 10181.7,
including, but not limited to, hospital, outpatient medical, and
mental health, or information on trend attributable to cost and trend
attributable to utilization by benefit category pursuant to
subdivision (d), (d) of Section 10181.
7, shall annually disclose all of the following aggregate
data for its large group health insurance policies:
(1) (A) The insurer's overall aggregate data demonstrating or
reasonably estimating year-to-year cost increases
change in the aggregate for large group rates by major
service category. The insurer shall distinguish between the
increase change ascribed to the volume of
services provided and the increase ascribed to the cost of services
provided for those assumptions that shall include the following
categories:
(i) Hospital inpatient.
(ii) Outpatient visits.
(iii) Outpatient surgical or other procedures.
(iv) Professional medical.
(v) Mental health.
(vi) Substance abuse.
(vii) Skilled nursing facility, if covered.
(viii) Prescription drugs.
(ix) Other ancillary services.
(x) Laboratory.
(xi) Radiology or imaging.
(B) An insurer may provide aggregated
additional aggregated data that demonstrate
demonstrates or reasonably estimate
estimates year-to-year cost increases
change in each of the specific service
categories specified in subparagraph (A) for each of the major
geographic regions of the state if any.
(2) The amount of projected trend attributable to the following
categories:
(A) Use of services by service and disease category.
(B) Capital investment.
(C) Community benefit expenditures, excluding bad debt and valued
at cost.
(3) The amount and proportion of costs attributed to contracting
medical groups that would not have been attributable as medical
losses if incurred by the health insurer rather than the medical
group.
(f)
(h) (1) A health insurer shall annually provide claims
data at no charge to a large group purchaser if the large group
purchaser requests the information. The health insurer shall provide
claims data that a qualified statistician has determined are
is deidentified so that the claims data
do does not identify or do not
provide a reasonable basis from which to identify an
individual.
(2) Information provided to a large group purchaser under this
subdivision is not subject to Section 10181.7.
(3) (A) If claims data are is not
available, the insurer shall provide, at no charge to the purchaser,
all of the following:
(i) Deidentified data sufficient for the large group purchaser to
calculate the cost of obtaining similar services from other health
insurers insurance policies and plans
and evaluate cost-effectiveness by service and disease category.
(ii) Deidentified patient-level data on demographics, prescribing,
encounters, inpatient services, outpatient services, and any other
data as may be required of the health insurer to comply with risk
adjustment, reinsurance, or risk corridors pursuant to the federal
Patient Protection and Affordable Care Act (Public Law 111-148), as
amended by the federal Health Care and Education Reconciliation Act
of 2010 (Public Law 111-152), and any rules, regulations, or guidance
issued thereunder pursuant to these acts
.
(iii) Deidentified patient-level data used to experience rate the
large group, including diagnostic and procedure coding and costs
assigned to each service.
(B) The health insurer shall obtain a formal determination from a
qualified statistician that the data provided pursuant to this
paragraph have has been deidentified so
that the data do does not identify or
do not provide a reasonable basis from which to
identify an individual. The statistician shall certify the formal
determination in writing and shall, upon request, provide the
protocol used for deidentification to the department.
(4) Data provided pursuant to this subdivision shall only be
provided to a large group purchaser that meets both of the following
conditions:
(A) Is The large group purchaser is
able to demonstrate its ability to comply with state and federal
privacy laws.
(B) Is a The large group
purchaser that is either an employer with an
enrollment of greater than 1,000 covered lives or a multiemployer
trust.
(g)
(i) The department may require all health insurers to
submit all rate filings to the National Association of Insurance
Commissioners' System for Electronic Rate and Form Filing (SERFF).
Submission of the required rate filings to SERFF shall be deemed to
be filing with the department for purposes of compliance with this
section.
SEC. 6. 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.