Amended in Senate August 2, 2016

Amended in Assembly May 11, 2016

Amended in Assembly April 20, 2016

Amended in Assembly April 5, 2016

Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2115

Introduced by Assembly Member Wood

February 17, 2016

An act to amend Section 1366.50 of the Health and Safety Code, and to amend Section 10786 of the Insurance Code, relating to health care coverage.

LEGISLATIVE COUNSEL’S DIGEST

AB 2115, as amended, Wood. Health care coverage: disclosures.

Existing law, the federal Patient Protection and Affordable Care Act, requires each state to, by January 1, 2014, establish an American Health Benefit Exchange that makes available qualified health plans to qualified individuals and small employers. Existing state law establishes the California Health Benefit Exchange within state government for the purpose of facilitating the enrollment of qualified individuals and qualified small employers in qualified health plans.

Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the 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 provides for the regulation of health insurers by the Department of Insurance. Existing law requires specified health care service plans and health insurers to provide to individuals who cease to be enrolled in individual or group health care coverage a notice informing those individuals that they may be eligible for reduced-cost coverage through the California Health Benefit Exchange or no-cost coverage through Medi-Cal.

This bill would require a statement regarding patient assistance programs to be included in the notice from health care service plans and health insurers to individuals who cease to be enrolled in individual or group health care coverage, as specified. Because a willful violation of these 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 1366.50 of the Health and Safety Code
is amended to read:

1366.50.  

(a) (1) On and after January 1, begin delete 2017, end delete begin insert 2018, end insert a health
care service plan providing individual or group health care coverage
shall provide to enrollees or subscribers who cease to be enrolled
in coverage a notice informing them that they may be eligible for
reduced-cost coverage through the California Health Benefit
Exchange established under Title 22 (commencing with Section
100500) of the Government Code, begin insert or end insert no-cost coverage through begin delete Medi-Cal, or free or reduced cost prescription medicines through
a manufacturer’s patient assistance program. end delete begin insert Medi-Cal. end insert The notice
shall include information on obtaining coverage or assistance
pursuant to those programs, shall be in no less than 12-point type,
and shall be developed by the department, no later than July 1,
2017, in consultation with the Department of Insurance, the Office
of the Patient Advocate, and the California Health Benefit
Exchange.

(2) The notice shall include a statement begin delete clarifying that assistance
through a manufacturer’s patient assistance program does not
constitute coverage under, and will end delete begin insert indicating that additional
information on low- or no-cost programs for health care and
prescription medicines may be found on the Office of the Patient
Advocate’s Internet Web site but that these programs may end insert not meet
the requirements of the individual mandate begin delete under, end delete begin insert under end insert the federal
Patient Protection and Affordable Care Act.

begin delete

(3) The department shall include information in the notice on
locating free or reduced cost programs for health care and
prescription medicines, such as through the Internet Web site of
the Office of the Patient Advocate.

end delete

(b) The notice described in subdivision (a) may be incorporated
into or sent simultaneously with and in the same manner as any
other notices sent by the health care service plan.

(c) This section shall not apply with respect to a specialized
health care service plan contract or a Medicare supplemental plan
contract.

SEC. 2.  

Section 10786 of the Insurance Code is amended to
read:

10786.  

(a) (1) On and after January 1, begin delete 2017, end delete begin insert 2018, end insert a health
insurer providing health insurance coverage shall provide to
policyholders in individual policies or certificate holders in group
policies who cease to be enrolled in coverage a notice informing
them that they may be eligible for reduced-cost coverage through
the California Health Benefit Exchange established under Title 22
(commencing with Section 100500) of the Government Code, begin insert or end insert
no-cost coverage through begin delete Medi-Cal, or free or reduced cost
prescription medicines through a manufacturer’s patient assistance
program. end delete begin insert Medi-Cal. end insert The notice shall include information on
obtaining coverage or assistance pursuant to those programs, shall
be in no less than 12-point type, and shall be developed by the
department, no later than July 1, 2017, in consultation with the
Department of Managed Health Care, the Office of the Patient
Advocate, and the California Health Benefit Exchange.

(2) The notice shall include a statement begin delete clarifying that assistance
through a manufacturer’s patient assistance program does not
constitute coverage under, and will end delete begin insert indicating that additional
information on low- or no-cost programs for health care and
prescription medicines may be found on the Office of the Patient
Advocate’s Internet Web site but that these programs may end insert not meet
the requirements of the individual mandate begin delete under, end delete begin insert under end insert the federal
Patient Protection and Affordable Care Act.

begin delete

(3) The department shall include information in the notice on
locating free or reduced cost programs for health care and
prescription medicines, such as through the Internet Web site of
the Office of the Patient Advocate.

end delete

(b) The notice described in subdivision (a) may be incorporated
into or sent simultaneously with and in the same manner as any
other notices sent by the health insurer.

(c) This section shall not apply with respect to a specialized
health insurance policy or a health insurance policy consisting
solely of coverage of excepted benefits as described in Section
2722 of the federal Public Health Service Act (42 U.S.C. Sec.
300gg-21).

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.