Amended in Assembly March 26, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 1102

Introduced by Assembly Member Santiago

February 27, 2015

An act to amend Section begin delete 1569.31 end delete begin insert 1399.849 end insert of the Health and Safety Code, begin insert and to amend Section 10965.3 of the Insurance Code, end insert relating to begin delete residential care facilities for the elderly. end delete begin insert health care coverage. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 1102, as amended, Santiago. begin delete Residential care facilities for the elderly. end delete begin insert Health care coverage: special enrollment periods: triggering event. end insert

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Existing federal law, the Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms as of January 1, 2014. Among other things, PPACA requires each state, by January 1, 2014, to establish an American Health Benefit Exchange that facilitates the purchase of qualified health plans by qualified individuals and qualified small employers, and requires each exchange to provide for an initial open enrollment period, annual open enrollment periods, and special enrollment periods.

end insert begin insert

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, on and after October 1, 2013, to offer, market, and sell all of the plan’s or insurer’s health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in each service area in which the plan or insurer provides or arranges for the provision of health care services, as specified, but requires plans and insurers to limit enrollment in individual health benefit plans to specified open enrollment and special enrollment periods. Existing law requires a health care service plan and health insurer to allow an individual to enroll in or change individual health benefit plans as a result of specified triggering events, including that he or she gains a dependent.

end insert begin insert

This bill would require a health care service plan or health insurer to allow an individual to enroll or change individual health benefits if the individual becomes pregnant. Because a willful violation of this requirement by a health care service plan would be a crime, this bill would impose a state-mandated local program.

end insert begin insert

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.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert begin delete

Existing law provides for the licensure of residential care facilities for the elderly by the State Department of Social Services, including prescribing standards of safety and sanitation for the physical plant and standards for basic care and supervision, personal care, and services to be provided. Violation of these provisions is a crime.

end delete begin delete

This bill would make technical, nonsubstantive changes to these provisions.

end delete

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 1399.849 of the end insert begin insert Health and Safety Code end insert
begin insert is amended to read: end insert

1399.849.  

(a) (1) On and after October 1, 2013, a plan shall
fairly and affirmatively offer, market, and sell all of the plan’s
health benefit plans that are sold in the individual market for policy
years on or after January 1, 2014, to all individuals and dependents
in each service area in which the plan provides or arranges for the
provision of health care services. A plan shall limit enrollment in
individual health benefit plans to open enrollment periods, annual
enrollment periods, and special enrollment periods as provided in
subdivisions (c) and (d).

(2) A plan shall allow the subscriber of an individual health
benefit plan to add a dependent to the subscriber’s plan at the
option of the subscriber, consistent with the open enrollment,
annual enrollment, and special enrollment period requirements in
this section.

(b) An individual health benefit plan issued, amended, or
renewed on or after January 1, 2014, shall not impose any
preexisting condition provision upon any individual.

(c) (1) A plan shall provide an initial open enrollment period
from October 1, 2013, to March 31, 2014, inclusive, an annual
enrollment period for the policy year beginning on January 1, 2015,
from November 15, 2014, to February 15, 2015, inclusive, and
annual enrollment periods for policy years beginning on or after
January 1, 2016, from October 15 to December 7, inclusive, of the
preceding calendar year.

(2) Pursuant to Section 147.104(b)(2) of Title 45 of the Code
of Federal Regulations, for individuals enrolled in noncalendar
year individual health plan contracts, a plan shall also provide a
limited open enrollment period beginning on the date that is 30
calendar days prior to the date the policy year ends in 2014.

(d) (1) Subject to paragraph (2), commencing January 1, 2014,
a plan shall allow an individual to enroll in or change individual
health benefit plans as a result of the following triggering events:

(A) He or she or his or her dependent loses minimum essential
coverage. For purposes of this paragraph, the following definitions
shall apply:

(i) “Minimum essential coverage” has the same meaning as that
term is defined in subsection (f) of Section 5000A of the Internal
Revenue Code (26 U.S.C. Sec. 5000A).

(ii) “Loss of minimum essential coverage” includes, but is not
limited to, loss of that coverage due to the circumstances described
in Section 54.9801-6(a)(3)(i) to (iii), inclusive, of Title 26 of the
Code of Federal Regulations and the circumstances described in
Section 1163 of Title 29 of the United States Code. “Loss of
minimum essential coverage” also includes loss of that coverage
for a reason that is not due to the fault of the individual.

(iii) “Loss of minimum essential coverage” does not include
loss of that coverage due to the individual’s failure to pay
premiums on a timely basis or situations allowing for a rescission,
subject to clause (ii) and Sections 1389.7 and 1389.21.

(B) He or she gains a dependent or becomes a dependent.

(C) He or she is mandated to be covered as a dependent pursuant
to a valid state or federal court order.

(D) He or she has been released from incarceration.

(E) His or her health coverage issuer substantially violated a
material provision of the health coverage contract.

(F) He or she gains access to new health benefit plans as a result
of a permanent move.

(G) He or she was receiving services from a contracting provider
under another health benefit plan, as defined in Section 1399.845
of this code or Section 10965 of the Insurance Code, for one of
the conditions described in subdivision (c) of Section 1373.96 and
that provider is no longer participating in the health benefit plan.

(H) He or she demonstrates to the Exchange, with respect to
health benefit plans offered through the Exchange, or to the
department, with respect to health benefit plans offered outside
the Exchange, that he or she did not enroll in a health benefit plan
during the immediately preceding enrollment period available to
the individual because he or she was misinformed that he or she
was covered under minimum essential coverage.

(I) He or she is a member of the reserve forces of the United
States military returning from active duty or a member of the
California National Guard returning from active duty service under
Title 32 of the United States Code.

begin insert

(J) An individual becomes pregnant.

end insert begin delete

(J)

end delete

begin insert (K) end insert  With respect to individual health benefit plans offered
through the Exchange, in addition to the triggering events listed
in this paragraph, any other events listed in Section 155.420(d) of
Title 45 of the Code of Federal Regulations.

(2) With respect to individual health benefit plans offered
outside the Exchange, an individual shall have 60 days from the
date of a triggering event identified in paragraph (1) to apply for
coverage from a health care service plan subject to this section.
With respect to individual health benefit plans offered through the
Exchange, an individual shall have 60 days from the date of a
triggering event identified in paragraph (1) to select a plan offered
through the Exchange, unless a longer period is provided in Part
155 (commencing with Section 155.10) of Subchapter B of Subtitle
A of Title 45 of the Code of Federal Regulations.

(e) With respect to individual health benefit plans offered
through the Exchange, the effective date of coverage required
pursuant to this section shall be consistent with the dates specified
in Section 155.410 or 155.420 of Title 45 of the Code of Federal
Regulations, as applicable. A dependent who is a registered
domestic partner pursuant to Section 297 of the Family Code shall
have the same effective date of coverage as a spouse.

(f) With respect to individual health benefit plans offered outside
the Exchange, the following provisions shall apply:

(1) After an individual submits a completed application form
for a plan contract, the health care service plan shall, within 30
days, notify the individual of the individual’s actual premium
charges for that plan established in accordance with Section
1399.855. The individual shall have 30 days in which to exercise
the right to buy coverage at the quoted premium charges.

(2) With respect to an individual health benefit plan for which
an individual applies during the initial open enrollment period
described in subdivision (c), when the subscriber submits a
premium payment, based on the quoted premium charges, and that
payment is delivered or postmarked, whichever occurs earlier, by
December 15, 2013, coverage under the individual health benefit
plan shall become effective no later than January 1, 2014. When
that payment is delivered or postmarked within the first 15 days
of any subsequent month, coverage shall become effective no later
than the first day of the following month. When that payment is
delivered or postmarked between December 16, 2013, and
December 31, 2013, inclusive, or after the 15th day of any
subsequent month, coverage shall become effective no later than
the first day of the second month following delivery or postmark
of the payment.

(3) With respect to an individual health benefit plan for which
an individual applies during the annual open enrollment period
described in subdivision (c), when the individual submits a
premium payment, based on the quoted premium charges, and that
payment is delivered or postmarked, whichever occurs later, by
December 15, coverage shall become effective as of the following
January 1. When that payment is delivered or postmarked within
the first 15 days of any subsequent month, coverage shall become
effective no later than the first day of the following month. When
that payment is delivered or postmarked between December 16
and December 31, inclusive, or after the 15th day of any subsequent
month, coverage shall become effective no later than the first day
of the second month following delivery or postmark of the
payment.

(4) With respect to an individual health benefit plan for which
an individual applies during a special enrollment period described
in subdivision (d), the following provisions shall apply:

(A) When the individual submits a premium payment, based
on the quoted premium charges, and that payment is delivered or
postmarked, whichever occurs earlier, within the first 15 days of
the month, coverage under the plan shall become effective no later
than the first day of the following month. When the premium
payment is neither delivered nor postmarked until after the 15th
day of the month, coverage shall become effective no later than
the first day of the second month following delivery or postmark
of the payment.

(B) Notwithstanding subparagraph (A), in the case of a birth,
adoption, or placement for adoption, the coverage shall be effective
on the date of birth, adoption, or placement for adoption.

(C) Notwithstanding subparagraph (A), in the case of marriage
or becoming a registered domestic partner or in the case where a
qualified individual loses minimum essential coverage, the
coverage effective date shall be the first day of the month following
the date the plan receives the request for special enrollment.

(g) (1) A health care service plan shall not establish rules for
eligibility, including continued eligibility, of any individual to
enroll under the terms of an individual health benefit plan based
on any of the following factors:

(A) Health status.

(B) Medical condition, including physical and mental illnesses.

(C) Claims experience.

(D) Receipt of health care.

(E) Medical history.

(F) Genetic information.

(G) Evidence of insurability, including conditions arising out
of acts of domestic violence.

(H) Disability.

(I) Any other health status-related factor as determined by any
federal regulations, rules, or guidance issued pursuant to Section
2705 of the federal Public Health Service Act.

(2) Notwithstanding Section 1389.1, a health care service plan
shall not require an individual applicant or his or her dependent
to fill out a health assessment or medical questionnaire prior to
enrollment under an individual health benefit plan. A health care
service plan shall not acquire or request information that relates
to a health status-related factor from the applicant or his or her
dependent or any other source prior to enrollment of the individual.

(h) (1) A health care service plan shall consider as a single risk
pool for rating purposes in the individual market the claims
experience of all insureds and all enrollees in all nongrandfathered
individual health benefit plans offered by that health care service
plan in this state, whether offered as health care service plan
contracts or individual health insurance policies, including those
insureds and enrollees who enroll in individual coverage through
the Exchange and insureds and enrollees who enroll in individual
coverage outside of the Exchange. Student health insurance
coverage, as that coverage is defined in Section 147.145(a) of Title
45 of the Code of Federal Regulations, shall not be included in a
health care service plan’s single risk pool for individual coverage.

(2) Each calendar year, a health care service plan shall establish
an index rate for the individual market in the state based on the
total combined claims costs for providing essential health benefits,
as defined pursuant to Section 1302 of PPACA, within the single
risk pool required under paragraph (1). The index rate shall be
adjusted on a marketwide basis based on the total expected
marketwide payments and charges under the risk adjustment and
reinsurance programs established for the state pursuant to Sections
1343 and 1341 of PPACA and Exchange user fees, as described
in subdivision (d) of Section 156.80 of Title 45 of the Code of
Federal Regulations. The premium rate for all of the health benefit
plans in the individual market within the single risk pool required
under paragraph (1) shall use the applicable marketwide adjusted
index rate, subject only to the adjustments permitted under
paragraph (3).

(3) A health care service plan may vary premium rates for a
particular health benefit plan from its index rate based only on the
following actuarially justified plan-specific factors:

(A) The actuarial value and cost-sharing design of the health
benefit plan.

(B) The health benefit plan’s provider network, delivery system
characteristics, and utilization management practices.

(C) The benefits provided under the health benefit plan that are
in addition to the essential health benefits, as defined pursuant to
Section 1302 of PPACA and Section 1367.005. These additional
benefits shall be pooled with similar benefits within the single risk
pool required under paragraph (1) and the claims experience from
those benefits shall be utilized to determine rate variations for
plans that offer those benefits in addition to essential health
benefits.

(D) With respect to catastrophic plans, as described in subsection
(e) of Section 1302 of PPACA, the expected impact of the specific
eligibility categories for those plans.

(E) Administrative costs, excluding user fees required by the
Exchange.

(i) This section shall only apply with respect to individual health
benefit plans for policy years on or after January 1, 2014.

(j) This section shall not apply to a grandfathered health plan.

(k) If Section 5000A of the Internal Revenue Code, as added
by Section 1501 of PPACA, is repealed or amended to no longer
apply to the individual market, as defined in Section 2791 of the
federal Public Health Service Act (42 U.S.C. Sec. 300gg-91),
subdivisions (a), (b), and (g) shall become inoperative 12 months
after that repeal or amendment.

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 10965.3 of the end insert begin insert Insurance Code end insert begin insert is amended to
read: end insert

10965.3.  

(a) (1) On and after October 1, 2013, a health insurer
shall fairly and affirmatively offer, market, and sell all of the
insurer’s health benefit plans that are sold in the individual market
for policy years on or after January 1, 2014, to all individuals and
dependents in each service area in which the insurer provides or
arranges for the provision of health care services. A health insurer
shall limit enrollment in individual health benefit plans to open
enrollment periods, annual enrollment periods, and special
enrollment periods as provided in subdivisions (c) and (d).

(2) A health insurer shall allow the policyholder of an individual
health benefit plan to add a dependent to the policyholder’s health
benefit plan at the option of the policyholder, consistent with the
open enrollment, annual enrollment, and special enrollment period
requirements in this section.

(b) An individual health benefit plan issued, amended, or
renewed on or after January 1, 2014, shall not impose any
preexisting condition provision upon any individual.

(c) (1) A health insurer shall provide an initial open enrollment
period from October 1, 2013, to March 31, 2014, inclusive, an
annual enrollment period for the policy year beginning on January
1, 2015, from November 15, 2014, to February 15, 2015, inclusive,
and annual enrollment periods for policy years beginning on or
after January 1, 2016, from October 15 to December 7, inclusive,
of the preceding calendar year.

(2) Pursuant to Section 147.104(b)(2) of Title 45 of the Code
of Federal Regulations, for individuals enrolled in noncalendar-year
individual health plan contracts, a health insurer shall also provide
a limited open enrollment period beginning on the date that is 30
calendar days prior to the date the policy year ends in 2014.

(d) (1) Subject to paragraph (2), commencing January 1, 2014,
a health insurer shall allow an individual to enroll in or change
individual health benefit plans as a result of the following triggering
events:

(A) He or she or his or her dependent loses minimum essential
coverage. For purposes of this paragraph, both of the following
definitions shall apply:

(i) “Minimum essential coverage” has the same meaning as that
term is defined in subsection (f) of Section 5000A of the Internal
Revenue Code (26 U.S.C. Sec. 5000A).

(ii) “Loss of minimum essential coverage” includes, but is not
limited to, loss of that coverage due to the circumstances described
in Section 54.9801-6(a)(3)(i) to (iii), inclusive, of Title 26 of the
Code of Federal Regulations and the circumstances described in
Section 1163 of Title 29 of the United States Code. “Loss of
minimum essential coverage” also includes loss of that coverage
for a reason that is not due to the fault of the individual.

(iii) “Loss of minimum essential coverage” does not include
loss of that coverage due to the individual’s failure to pay
premiums on a timely basis or situations allowing for a rescission,
subject to clause (ii) and Sections 10119.2 and 10384.17.

(B) He or she gains a dependent or becomes a dependent.

(C) He or she is mandated to be covered as a dependent pursuant
to a valid state or federal court order.

(D) He or she has been released from incarceration.

(E) His or her health coverage issuer substantially violated a
material provision of the health coverage contract.

(F) He or she gains access to new health benefit plans as a result
of a permanent move.

(G) He or she was receiving services from a contracting provider
under another health benefit plan, as defined in Section 10965 of
this code or Section 1399.845 of the Health and Safety Code, for
one of the conditions described in subdivision (a) of Section
10133.56 and that provider is no longer participating in the health
benefit plan.

(H) He or she demonstrates to the Exchange, with respect to
health benefit plans offered through the Exchange, or to the
department, with respect to health benefit plans offered outside
the Exchange, that he or she did not enroll in a health benefit plan
during the immediately preceding enrollment period available to
the individual because he or she was misinformed that he or she
was covered under minimum essential coverage.

(I) He or she is a member of the reserve forces of the United
States military returning from active duty or a member of the
California National Guard returning from active duty service under
Title 32 of the United States Code.

begin insert

(J) An individual becomes pregnant.

end insert begin delete

(J)

end delete

begin insert (K) end insert  With respect to individual health benefit plans offered
through the Exchange, in addition to the triggering events listed
in this paragraph, any other events listed in Section 155.420(d) of
Title 45 of the Code of Federal Regulations.

(2) With respect to individual health benefit plans offered
outside the Exchange, an individual shall have 60 days from the
date of a triggering event identified in paragraph (1) to apply for
coverage from a health care service plan subject to this section.
With respect to individual health benefit plans offered through the
Exchange, an individual shall have 60 days from the date of a
triggering event identified in paragraph (1) to select a plan offered
through the Exchange, unless a longer period is provided in Part
155 (commencing with Section 155.10) of Subchapter B of Subtitle
A of Title 45 of the Code of Federal Regulations.

(e) With respect to individual health benefit plans offered
through the Exchange, the effective date of coverage required
pursuant to this section shall be consistent with the dates specified
in Section 155.410 or 155.420 of Title 45 of the Code of Federal
Regulations, as applicable. A dependent who is a registered
domestic partner pursuant to Section 297 of the Family Code shall
have the same effective date of coverage as a spouse.

(f) With respect to an individual health benefit plan offered
outside the Exchange, the following provisions shall apply:

(1) After an individual submits a completed application form
for a plan, the insurer shall, within 30 days, notify the individual
of the individual’s actual premium charges for that plan established
in accordance with Section 10965.9. The individual shall have 30
days in which to exercise the right to buy coverage at the quoted
premium charges.

(2) With respect to an individual health benefit plan for which
an individual applies during the initial open enrollment period
described in subdivision (c), when the policyholder submits a
premium payment, based on the quoted premium charges, and that
payment is delivered or postmarked, whichever occurs earlier, by
December 15, 2013, coverage under the individual health benefit
plan shall become effective no later than January 1, 2014. When
that payment is delivered or postmarked within the first 15 days
of any subsequent month, coverage shall become effective no later
than the first day of the following month. When that payment is
delivered or postmarked between December 16, 2013, and
December 31, 2013, inclusive, or after the 15th day of any
subsequent month, coverage shall become effective no later than
the first day of the second month following delivery or postmark
of the payment.

(3) With respect to an individual health benefit plan for which
an individual applies during the annual open enrollment period
described in subdivision (c), when the individual submits a
premium payment, based on the quoted premium charges, and that
payment is delivered or postmarked, whichever occurs later, by
December 15, coverage shall become effective as of the following
January 1. When that payment is delivered or postmarked within
the first 15 days of any subsequent month, coverage shall become
effective no later than the first day of the following month. When
that payment is delivered or postmarked between December 16
and December 31, inclusive, or after the 15th day of any subsequent
month, coverage shall become effective no later than the first day
of the second month following delivery or postmark of the
payment.

(4) With respect to an individual health benefit plan for which
an individual applies during a special enrollment period described
in subdivision (d), the following provisions shall apply:

(A) When the individual submits a premium payment, based
on the quoted premium charges, and that payment is delivered or
postmarked, whichever occurs earlier, within the first 15 days of
the month, coverage under the plan shall become effective no later
than the first day of the following month. When the premium
payment is neither delivered nor postmarked until after the 15th
day of the month, coverage shall become effective no later than
the first day of the second month following delivery or postmark
of the payment.

(B) Notwithstanding subparagraph (A), in the case of a birth,
adoption, or placement for adoption, the coverage shall be effective
on the date of birth, adoption, or placement for adoption.

(C) Notwithstanding subparagraph (A), in the case of marriage
or becoming a registered domestic partner or in the case where a
qualified individual loses minimum essential coverage, the
coverage effective date shall be the first day of the month following
the date the insurer receives the request for special enrollment.

(g) (1) A health insurer shall not establish rules for eligibility,
including continued eligibility, of any individual to enroll under
the terms of an individual health benefit plan based on any of the
following factors:

(A) Health status.

(B) Medical condition, including physical and mental illnesses.

(C) Claims experience.

(D) Receipt of health care.

(E) Medical history.

(F) Genetic information.

(G) Evidence of insurability, including conditions arising out
of acts of domestic violence.

(H) Disability.

(I) Any other health status-related factor as determined by any
federal regulations, rules, or guidance issued pursuant to Section
2705 of the federal Public Health Service Act.

(2) Notwithstanding subdivision (c) of Section 10291.5, a health
insurer shall not require an individual applicant or his or her
dependent to fill out a health assessment or medical questionnaire
prior to enrollment under an individual health benefit plan. A health
insurer shall not acquire or request information that relates to a
health status-related factor from the applicant or his or her
dependent or any other source prior to enrollment of the individual.

(h) (1) A health insurer shall consider as a single risk pool for
rating purposes in the individual market the claims experience of
all insureds and enrollees in all nongrandfathered individual health
benefit plans offered by that insurer in this state, whether offered
as health care service plan contracts or individual health insurance
policies, including those insureds and enrollees who enroll in
individual coverage through the Exchange and insureds and
enrollees who enroll in individual coverage outside the Exchange.
Student health insurance coverage, as such coverage is defined in
Section 147.145(a) of Title 45 of the Code of Federal Regulations,
shall not be included in a health insurer’s single risk pool for
individual coverage.

(2) Each calendar year, a health insurer shall establish an index
rate for the individual market in the state based on the total
combined claims costs for providing essential health benefits, as
defined pursuant to Section 1302 of PPACA, within the single risk
pool required under paragraph (1). The index rate shall be adjusted
on a marketwide basis based on the total expected marketwide
payments and charges under the risk adjustment and reinsurance
programs established for the state pursuant to Sections 1343 and
1341 of PPACA and Exchange user fees, as described in
subdivision (d) of Section 156.80 of Title 45 of the Code of Federal
Regulations. The premium rate for all of the health benefit plans
in the individual market within the single risk pool required under
paragraph (1) shall use the applicable marketwide adjusted index
rate, subject only to the adjustments permitted under paragraph
(3).

(3) A health insurer may vary premium rates for a particular
health benefit plan from its index rate based only on the following
actuarially justified plan-specific factors:

(A) The actuarial value and cost-sharing design of the health
benefit plan.

(B) The health benefit plan’s provider network, delivery system
characteristics, and utilization management practices.

(C) The benefits provided under the health benefit plan that are
in addition to the essential health benefits, as defined pursuant to
Section 1302 of PPACA and Section 10112.27. These additional
benefits shall be pooled with similar benefits within the single risk
pool required under paragraph (1) and the claims experience from
those benefits shall be utilized to determine rate variations for
plans that offer those benefits in addition to essential health
benefits.

(D) With respect to catastrophic plans, as described in subsection
(e) of Section 1302 of PPACA, the expected impact of the specific
eligibility categories for those plans.

(E) Administrative costs, excluding any user fees required by
the Exchange.

(i) This section shall only apply with respect to individual health
benefit plans for policy years on or after January 1, 2014.

(j) This section shall not apply to a grandfathered health plan.

(k) If Section 5000A of the Internal Revenue Code, as added
by Section 1501 of PPACA, is repealed or amended to no longer
apply to the individual market, as defined in Section 2791 of the
federal Public Health Service Act (42 U.S.C. Sec. 300gg-91),
subdivisions (a), (b), and (g) shall become inoperative 12 months
after the date of that repeal or amendment and individual health
care benefit plans shall thereafter be subject to Sections 10901.2,
10951, and 10953.

begin insert

begin insert SEC. 3. end insert   

end insert begin insert

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.

end insert

begin delete

SECTION 1.  

Section 1569.31 of the Health and Safety Code
is amended to read:

1569.31.  

(a) The regulations for a license shall prescribe
standards of safety and sanitation for the physical plant and
standards for basic care and supervision, personal care, and services
to be provided.

(b) The department’s regulations shall allow for the development
of new and innovative community programs.

(c) In adopting regulations that implement this chapter, the
department shall provide flexibility to allow facilities conducted
by and exclusively for adherents of a well-recognized church or
religious denomination who rely solely on prayer or spiritual means
for healing to operate a licensed residential care facility for the
elderly.

end delete