BILL ANALYSIS Ó
SB 137
Page 1
SENATE THIRD READING
SB
137 (Hernandez)
As Amended September 4, 2015
Majority vote
SENATE VOTE: 35-0
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Health |17-2 |Bonta, Maienschein, |Lackey, Patterson |
| | |Bonilla, Burke, | |
| | |Chávez, Chiu, Gomez, | |
| | |Gonzalez, Roger | |
| | |Hernández, Nazarian, | |
| | |Ridley-Thomas, | |
| | |Rodriguez, Santiago, | |
| | |Steinorth, Thurmond, | |
| | |Waldron, Wood | |
| | | | |
|----------------+-----+-----------------------+---------------------|
|Appropriations |12-2 |Gomez, Bloom, Bonta, |Bigelow, Jones |
| | |Calderon, Nazarian, | |
| | |Eggman, | |
| | | | |
| | | | |
| | |Eduardo Garcia, | |
SB 137
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| | |Holden, Quirk, Rendon, | |
| | |Weber, Wood | |
| | | | |
| | | | |
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SUMMARY: Requires health care service plans (plans) and health
insurers (insurers), collectively referred to as carriers, to
publish and maintain printed and online provider directories,
and sets requirements carriers must meet to maintain accurate
provider directories. Specifically, this bill:
1)Requires carriers, commencing July 1, 2016, to publish and
maintain written and online provider directories with
information on contracting providers that deliver health care
services to enrollees, as specified.
2)Requires carriers to update printed provider directories at
least quarterly and online provider directories at least
weekly, or more frequently if required by federal law, and
specifies when carriers must update provider information and
when to delete providers from the directories.
3)Requires provider directories for full-service health plans
and policies, mental health, vision, dental, and other
specialized plans to include specified information for various
provider and facility types, including provider contact
information; practice locations; non-English languages spoken
by providers or qualified medical interpreters on the
provider's staff; and, identification of providers no longer
accepting new patient's for a carrier's product.
4)Details policies and procedures carriers must follow to update
provider directories, including requirements for affirmative
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responses from providers confirming or updating their
information in the provider directories within specified
timeframes, and a process to allow providers to submit changes
or updates. Exempts general acute care hospitals from this
requirement.
5)Requires providers, except general acute care hospitals, to
verify or submit changes to their information in the provider
directories using a process as required by carriers, and
within specified timeframes. Authorizes carriers to delay
payment, as specified, to providers for up to one month,
remove providers from the provider directory, or terminate
contracts based on provider nonresponse to carrier requests to
verify or update provider directory information, within
specified timeframes. Exempts a provider group from the delay
in payment if all of the following occur:
a) A provider does not respond to the provider group's
attempt to verify, as defined, the provider's information;
b) The provider group documents the effort to verify the
provider's information; and,
c) The provider group reports to the carrier that the
provider should be deleted from the provider group in the
plan directory or directories.
6)Requires carriers to establish a process for an individual to
identify and report possible inaccurate, incomplete, or
misleading information listed in the provider directory, as
specified, and requires carriers to, within specified
timeframes, investigate such reports and update the
information in the provider directory as applicable.
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7)Requires carriers to use a consistent method of network and
product naming, numbering, or classification method to ensure
proper identification of networks and plan products in which a
provider participates; and, requires online provider
directories to be accessible through a clearly identifiable
link or tab and in a manner that is searchable by specified
informational elements including provider name, practice
address, language, distance from a specified address,
California license number, National Provider Identifier
number, and others.
8)Requires, on or before December 31, 2016, the Department of
Manages Health Care (DMHC) and the Department of Insurance
(CDI) to develop uniform provider directory standards to
permit consistency for naming, numbering, the classification
methods of, and ability to search a directory, as well as the
development of a multi-plan directory by another entity.
Exempts no more than two revisions of the standards developed
by DMHC and CDI from the Administrative Procedures Act until
January 1, 2021.
9)Requires carriers, by July 31, 2017, or 12 months after the
date the standards are developed, whichever is later, to
comply with the standards in 8) above.
10)Authorizes DMHC and CDI to require a carrier to provide
coverage for all health care services provided to an enrollee,
and to reimburse an enrollee for any amount beyond what the
enrollee would have paid for services provided by a
contracting provider, if DMHC or CDI find that the enrollee
reasonably relied upon materially inaccurate, incomplete, or
misleading information contained in a provider directory and,
as a result, obtained services from a non-contracting
provider.
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11)Requires plans to file an amendment to its plan application
with DMHC whenever it determines, as a result of the
provisions of this bill, that there has been a 10% change in
the network for a product in a region.
12)Provides that carriers are not prohibited from requiring
provider groups or contracting specialized health care plans
to provide information required by the carrier for each of the
providers that contract with the group or specialized plan, as
specified. Requires, under this arrangement, the carrier to
retain the responsibility for ensuring that the provisions of
this bill are satisfied. Allows a provider group to terminate
a contract with a provider for a pattern or repeated failure
to update the information required by the carrier.
13)Specifies that the provider directory standards apply to
Medi-Cal managed care (MCMC) plans to the extent consistent
with federal law and guidance issued after January 1, 2016,
and provides that a MCMC plan that complies with this bill is
not required to distribute a printed provider directory unless
one is requested.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill would result in:
1)One-time costs to DMHC in the hundreds of thousands (Managed
Care Fund), and in the range of $100,000 for CDI (Insurance
Fund) for development of complex regulations related to
standard provider directories.
2)Enforcement costs are unknown but likely significant for both
DMHC and CDI. Most costs would fall on DMHC, as they now
regulate the vast majority of the marketplace. Enforcement
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and complaint resolution costs would depend on compliance and
level of consumer complaints.
3)Although not a direct state cost, health plans indicate the
complex and prescriptive nature of the requirements translate
into several million dollars of one-time infrastructure costs
per plan, and significant costs ongoing. Increased
administrative costs can be passed on to consumers and
purchasers, including the state, as higher premiums and
cost-sharing and lower benefits.
COMMENTS: According to the author, the reliability of provider
directories has recently become a source of policy concern,
particularly following the implementation of the Patient
Protection and Affordable Care Act (ACA) which establishes an
individual mandate to maintain coverage, and which expands
Medicaid (Medi-Cal in California) to newly eligible populations.
Provider directories serve as a resource for consumers to
evaluate coverage options; determine whether a provider,
including primary a care physician, specialist, or hospital they
would like to see are contracted in a carrier's network; and, to
identify and locate providers and services when seeking care.
Californians shopping for health insurance must have confidence
in the provider directory information upon which they are basing
their decisions, especially when health insurance coverage is
required by government for most of the population. The author
states that this bill would establish provider directory
standards and routine updates of provider directories.
Over the last two years, the public, advocates, regulators, and
oversight agencies have expressed concerns about patient access
to providers and the accuracy of provider directories. Covered
California is California's state health benefit exchange. In
the fall of 2013, Covered California established an online
aggregated provider directory which would allow consumers to see
which providers belonged to which qualified health plan
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networks. However, due to inaccurate information regarding the
providers, the Web site was discontinued in February 2014.
According to Covered California, while the combined provider
directory was a useful service for consumers, some enrollees who
located physicians thought to be in their plan, subsequently
discovered they were not. In November 2014, DMHC audits of two
large health plans found significant inaccuracies in provider
directories. With regard to provider directories of MCMC plans,
a June 2015 California State Auditor report concluded that the
Department of Health Care Services (DHCS) did not verify
provider network data it received from MCMC plans were accurate,
and that flaws in DHCS' process for reviewing provider
directories have resulted in DHCS approving provider directories
with inaccurate information.
Regulatory actions at the federal and state levels aim to
improve the accuracy of provider directories. Under federal
regulations, carriers participating in health benefit exchanges
established under the ACA are required to publish up-to-date,
accurate, and easily accessible provider directories. Proposed
federal MCMC regulations require MCMC plans to update paper
provider directories at least monthly and electronic provider
directories within three days of learning of changes from
providers. In January 2015, CDI issued emergency regulations
requiring provider directories to include specified elements,
and to demonstrate the accuracy of its directories as required.
Health Access California, Consumers Union, and the California
Pan-Ethnic Health Network are cosponsors of this bill and argue
that it provides critical improvements to provider directories,
which are a crucial tool for consumers choosing and using a
health plan. Supporters state that consumers must have accurate
information about the doctors, hospitals, and other providers
covered by each product's network, and with this information,
they can make informed choices about which plans and policies
are best for them and avoid exposure to unexpected medical bills
by inadvertently obtaining care from out-of-network providers.
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The California Hospital Association, California Association of
Health Plans, Delta Dental, and America's Health Insurance Plans
have all officially removed their opposition.
Analysis Prepared by:
Patty Rodgers and Kelly Green / HEALTH / (916)
319-2097 FN:
0002175