BILL NUMBER: AB 533 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 15, 2015
INTRODUCED BY Assembly Member Bonta
FEBRUARY 23, 2015
An act to add Section 1371.9 to the Health and Safety Code, and to
add Section 10112.8 to the Insurance Code, relating to health care
coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 533, as amended, Bonta. Health care coverage: out-of-network
coverage.
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. A willful violation
of the act is a crime. Existing law requires a health care service
plan to reimburse providers for emergency services and care provided
to its enrollees, until the care results in stabilization of the
enrollee. Existing law prohibits a plan from requiring a provider to
obtain authorization prior to the provision of emergency services and
care necessary to stabilize the enrollee's emergency medical care,
as specified.
Existing law also provides for the regulation of health insurers
by the Insurance Commissioner. Existing law requires a health
insurance policy issued, amended, or renewed on or after January 1,
2014, that provides or covers benefits with respect to services in an
emergency department of a hospital to cover emergency services
without the need for prior authorization, regardless of whether the
provider is a participating provider, and subject to the same cost
sharing required if the services were provided by a participating
provider, as specified.
This bill would require a health care service plan contract or
health insurance policy issued, amended, or renewed on or after
January 1, 2016, to provide that if an enrollee or insured
obtains care from a participating
contracting health facility, as defined, at which, or as a
result of which, the enrollee or insured receives covered
services provided by a nonparticipating provider,
noncontracting individual health professional, as defined,
the enrollee or insured is required to pay the
nonparticipating provider noncontracting individual
health professional only the same cost sharing required if the
services were provided by a participating provider.
contracting individual health professional. The bill
would prohibit an enrollee or insured from owing the noncontracting
individual health professional at the contracting health facility
more than the in-network cost sharing amount if the noncontracting
individual health professional receives reimbursement for services
provided to the enrollee or insured at a contracting health facility
from the plan or health insurer. The bill would require a
noncontracting individual health professional who collects more than
the in-network cost sharing amount from the enrollee or insured to
refund any overpayment to the enrollee or insured, as specified, and
would provide that interest on any amount overpaid by, and not
refunded to, the enrollee or insured shall accrue at 15% per annum,
as specified. Because a willful violation of the bill's
provisions by a health care service plan would be a crime, this 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 1371.9 is added to the Health and Safety Code,
to read:
1371.9. (a) (1) A health care service plan contract issued,
amended, or renewed on or after January 1, 2016, shall provide that
if an enrollee obtains care from a participating
contracting health facility at which, or as a result of
which, the enrollee receives services provided by a
nonparticipating provider, noncontracting individual
health professional, the enrollee shall pay the
nonparticipating provider noncontracting individual
health profes sional no more than the same cost
sharing that the enrollee would have paid for the same covered
benefits received from a participating provider.
contracting individual health professional. This amount shall be
referred to as the "in-network cost sharing."
(2) Except as provided in subdivision (d), the plan shall not
reimburse a nonparticipating provider for services provided to the
enrollee if the nonparticipating provider obtains, or seeks to
obtain, more than the in-network cost sharing from the enrollee.
(2) At the time of payment by the plan to the noncontracting
individual health professional, the plan shall inform the
noncontracting individual health professional of the in-network cost
sharing owed by the enrollee. If a noncontracting individual health
professional receives reimbursement for services provided to the
enrollee at a contracting health facility from the plan, an enrollee
shall not owe the noncontracting individual health professional at
the contracting health facility more than the in-network cost
sharing.
(3) Except as provided in subdivision (d), if the noncontracting
individual health professional collects more than the in-network cost
sharing from the enrollee, the noncontracting individual health
professional shall refund any overpayment to the enrollee within 30
working days of receiving notice from the plan of the in-network cost
sharing amount owed by the enrollee pursuant to paragraph (2). If
the noncontracting individual health professional does not refund an
overpayment within 30 working days after being informed of the
enrollee's in-network cost sharing, interest shall accrue at the rate
of 15 percent per annum beginning with the first calendar day after
the 30-working day period. A noncontracting individual health
professional shall automatically include in his or her refund of the
overpayment all interest that has accrued pursuant to this section
without requiring the enrollee to submit a request for the interest
amount.
(4) If the noncontracting individual health professional has
advanced to collections any amount owed by the enrollee, the plan
shall not reimburse the noncontracting individual health professional
for services provided to the enrollee by the noncontracting
individual health professional at a contracting health facility. In
submitting a claim to the plan, the noncontracting individual health
professional at a contracting health facility shall affirm in writing
that he or she has not advanced to collections any payment owed by
the enrollee. A noncontracting individual health professional shall
not attempt to collect more than the in-network cost sharing from the
enrollee after receiving payment from the plan. Once the
noncontracting individual health professional receives payment from
the plan, the noncontracting individual health professional may
advance to collections any in-network cost sharing owed by the
enrollee if the enrollee fails to pay the in-network cost sharing
after the plan has informed the noncontracting individual health
professional of the amount owed by the enrollee pursuant to paragraph
(2).
(b) (1) Any cost sharing paid by the enrollee for the services
provided by a nonparticipating provider
noncontracting individual health professional at the
participating contracting health facility shall
count toward the limit on annual out-of-pocket expenses established
under Section 1367.006.
(2) Cost sharing arising from services received by a
noncontracting individual health professional at a
contracting health facility shall be counted toward any
deductible in the same manner as cost sharing would be attributed to
a participating provider. contracting
individual health professional.
(c) For purposes of this section, the following definitions shall
apply:
(1) "Cost sharing" includes any copayment, coinsurance, or
deductible, or any other form of cost sharing paid by the enrollee
other than premium or share of premium.
(2) "Nonparticipating provider" means a provider who is not
contracted with the enrollee's health care service plan to provide
services under the enrollee's plan contract.
(3) "Participating
(2) "Health facility" means a
health facility provider who is contracted with the enrollee'
s health care service plan to provide services under the enrollee's
plan contract. licensed by this state to deliver or
furnish health care services. A health facility
shall include the following providers:
(A) Licensed hospital.
(B) Skilled nursing facility.
(C) Ambulatory surgery.
(D) Laboratory.
(E) Radiology or imaging.
(F) Facilities providing mental health or substance abuse
treatment.
(G) Any other provider as the department may by regulation define
as a facility for purposes of this section.
(4) "Provider" means a health facility or any person who is
licensed by the state to deliver or furnish health care services.
(3) "Individual Health Professional" means a physician or surgeon
or other professional who is licensed by this state to deliver or
furnish health care services.
(d) An enrollee may voluntarily consent to the use of a
nonparticipating provider. noncontracting individual
health professional. For purposes of this section, consent
shall be voluntary if at least 24 hours in advance of the receipt of
services, the enrollee is provided a written estimate of the cost of
care by the nonparticipating provider
noncontracting individual health professional and the enrollee
consents in writing to both the use of a nonparticipating
provider noncontracting individual health professional
and the estimated additional cost for the services to be
provided by the nonparticipating provider.
noncontracting individual health professional. The consent
shall inform the enrollee that the cost of the services of the
nonparticipating provider noncontracting
individual health professional will not accrue to the limit on
annual out-of-pocket expenses. expenses or
the enrollee's deductible, if any.
(e) This section shall not be construed to require a plan to cover
services or provide benefits that are not otherwise covered under
the terms and conditions of the plan contract.
(f) This section shall not be construed to exempt a plan from the
requirements under Section 1373.96 or Section 1371.4, nor abrogate
the holding in Prospect Medical Group v. Northridge Emergency Medical
Group et al., (2009) 45 Cal.4th 497, that an emergency room
physician is prohibited from billing an enrollee of a health care
service plan directly for sums that the health care service plan has
failed to pay for the enrollee's emergency room treatment.
SEC. 2. Section 10112.8 is added to the Insurance Code, to read:
10112.8. (a) (1) A health insurance policy issued, amended, or
renewed on or after January 1, 2016, shall provide that if an insured
obtains care from a participating
contracting health facility at which, or as a result of which,
the insured receives services provided by a nonparticipating
provider, noncontracting individual health
professional, the insured shall pay the
nonparticipating provider noncontracting individual
health professional no more than the same cost sharing that the
insured would have paid for the same covered benefits received from
a participating provider. contracting
individual health professional. This amount shall be referred to as
the "in-network cost sharing."
(2) Except as provided in subdivision (d), the insurer shall not
reimburse a nonparticipating provider for services provided to the
insured if the nonparticipating provider obtains, or seeks to obtain,
more than the in-network cost sharing from the insured.
(2) At the time of payment by the health insurer to the
noncontracting individual health professional, the health insurer
shall inform the noncontracting individual health professional of the
in-network cost sharing owed by the insured. If a noncontracting
individual health professional receives reimbursement for services
provided to the insured at a contracting health facility from the
health insurer, an insured shall not owe the noncontracting
individual health professional at the contracting health facility
more than the in-network cost sharing.
(3) Except as provided in subdivision (d), if the noncontracting
individual health professional collects more than the in-network cost
sharing from the insured, the noncontracting individual health
professional shall refund any overpayment to the insured within 30
working days of receiving notice from the health insurer of the
in-network cost sharing amount owed by the insured pursuant to
paragraph (2). If the noncontracting individual health professional
does not refund an overpayment within 30 working days after being
informed of the insured's in-network cost sharing, interest shall
accrue at the rate of 15 percent per annum beginning with the first
calendar day after the 30-working day period. A noncontracting
individual health professional shall automatically include in his or
her refund of the overpayment all interest that has accrued pursuant
to this section without requiring the insured to submit a request for
the interest amount.
(4) If the noncontracting individual health professional has
advanced to collections any amount owed by the insured, the health
insurer shall not reimburse the noncontracting individual health
professional for services provided to the insured by the
noncontracting individual health professional at a contracting health
facility. In submitting a claim to the health insurer, the
noncontracting individual health professional at a contracting health
facility shall affirm in writing that he or she has not advanced to
collections any payment owed by the insured. A noncontracting
individual health professional shall not attempt to collect more than
the in-network cost sharing from the insured after receiving payment
from the health insurer. Once the noncontracting individual health
professional receives payment from the health insurer, the
noncontracting individual health professional may advance to
collections any in-network cost sharing owed by the insured if the
insured fails to pay the in-network cost sharing after the health
insurer has informed the noncontracting individual health
professional of the amount owed by the insured pursuant to paragraph
(2).
(3)
( 5) This section shall only apply to a
health insurer that enters into a contract with a professional or
institutional provider to provide services at alternative rates of
payment pursuant to Section 10133.
(b) (1) Any cost sharing paid by the insured for the services
provided by a nonparticipating provider
noncontracting individual health professional at the
participating contracting health
facility shall count toward the limit on annual out-of-pocket
expenses established under Section 10112.28.
(2) Cost sharing arising from services received by
a noncontracting individual health professional at a
contracting health facility shall be counted toward any
deductible in the same manner as cost sharing would be attributed to
a participating provider. contracting
individual health professional.
(c) For purposes of this section, the following definitions shall
apply:
(1) "Cost sharing" includes any copayment, coinsurance, or
deductible, or any other form of cost sharing paid by the insured
other than premium or share of premium.
(2) "Nonparticipating provider" means a provider who is not
contracted with the insured's health insurer to provide services
under the insured's policy.
(3) "Participating
(2) "Health facility" means a
health facility provider who is contracted with the insured'
s health insurer to provide services under the insured's policy.
licensed by this state to deliver or furnish health
care services. A facility shall include the following
providers:
(A) Licensed hospital.
(B) Skilled nursing facility.
(C) Ambulatory surgery.
(D) Laboratory.
(E) Radiology or imaging.
(F) Facilities providing mental health or substance abuse
treatment.
(G) Any other provider as the department
commissioner may by regulation define as a facility for
purposes of this section.
(4) "Provider" means a health facility or any person who is
licensed by the state to deliver or furnish health care services.
(3) "Individual health professional" means a physician or surgeon
or other professional who is licensed by this state to deliver or
furnish health care services.
(d) An insured may voluntarily consent to the use of a
nonparticipating provider. noncontracting individual
health professional. For purposes of this section, consent
shall be voluntary if at least 24 hours in advance of the receipt of
services, the insured is provided a written estimate of the cost of
care by the nonparticipating provider
noncontracting individual health professional and the insured
consents in writing to both the use of a nonparticipating
provider noncontracting individual health professional
and the estimated additional cost for the services to be
provided by the nonparticipating provider.
noncontracting individual health professional. The consent
shall inform the insured that the cost of the services of the
nonparticipating provider noncontracting
individual health professional will not accrue to the limit on
annual out-of-pocket expenses. expenses or
the insured's deductible, if any.
(e) This section shall not be construed to require an insurer to
cover services or provide benefits that are not otherwise covered
under the terms and conditions of the policy.
(f) This section shall not be construed to exempt a health insurer
from the requirements under Section 10112.7 or Section 10133.56.
SEC. 3. 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.