BILL ANALYSIS Ó
SB 388
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Date of Hearing: June 30, 2015
ASSEMBLY COMMITTEE ON HEALTH
Rob Bonta, Chair
SB
388 (Mitchell) - As Amended June 23, 2015
SENATE VOTE: 40-0
SUBJECT: Health care coverage: solicitation and enrollment.
SUMMARY: Makes the uniform summary of benefits and coverage
(SBC) document, provided by health care service plans (plans)
and health insurers (insurers) to consumers, a vital document
subject to specified language translation requirements.
Specifically, this bill:
1)Makes, commencing July 1, 2016, the uniform SBC a vital
document for the purposes of language translation requirements
for plans and insurers.
2)Requires, not later than July 1, 2016, the Department of
Managed Health Care (DMHC) and the California Department of
Insurance (CDI) to develop written translations of SBC
templates in all language groups identified by the Department
of Health Care Services (DHCS) in all plan letters as of
August 27, 2014 (commonly referred to as Medi-Cal threshold
languages), except for any language group for which the United
States Department of Labor (DOL) has already prepared a
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written translation.
3)Requires DMHC and CDI, not later than July 1, 2016, to make
the written translations of the template uniform SBC available
on their websites, as well as any written translations
prepared by the DOL, if available.
EXISTING LAW:
1)Requires, under the Patient Protection and Affordable Care Act
(ACA), federal agencies, as specified, to develop standards
for an SBC that accurately describes the benefits and coverage
under an applicable plan or coverage. Requires health plans
and insurers to provide the uniform SBC to enrollees.
2)Requires DMHC and CDI to develop and adopt regulations
establishing standards and requirements to provide enrollees
and insureds with appropriate access to language assistance in
obtaining health care services.
3)Requires DMHC and CDI to require plans, and insurers to assess
the linguistic needs of the enrollee or insured population,
excluding Medi-Cal enrollees, and to provide for translation
and interpretation for medical services, as indicated,
including translating vital documents in threshold languages
based on the sizes of enrollment and the needs assessment, as
specified.
4)Specifies the type of vital documents produced by the plan
that are required to be translated, including:
a) Applications;
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b) Consent forms;
c) Letters containing important information regarding
eligibility and participation criteria;
d) Notices pertaining to the denial, reduction,
modification, or termination of benefits, and the right to
file a grievance or appeal; and,
e) Notices advising limited-English-proficient persons
(LEP) of the availability of free language assistance and
other outreach materials that are provided to enrollees.
5)Specifies that vital documents shall not include an
explanation of benefits or similar claim processing
information sent to the enrollee or insured, unless the
document requires a response by the enrollee or insured.
6)Establishes various consumer disclosure requirements on health
plans, including a requirement for plans to provide a uniform
health plan benefits and coverage matrix (matrix) containing
the plan's major provisions in order to facilitate comparisons
between individual and small group market plans.
7)Requires insurers to provide to insureds summary information
about each disability insurance policy offered by the insurer
for full and fair disclosure of the provisions of the policy.
8)Permits plans and insurers subject to ACA uniform SBC
requirements to satisfy requirements to provide the matrix
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referenced in 5) above and the summary information referenced
in 6) above by providing the uniform SBC, as specified.
FISCAL EFFECT: According to the Senate Appropriations
Committee, this bill, as introduced, will result in:
1)One-time administrative costs likely between $150,000 and
$300,000 to develop policies and translate template documents
by CDI (Insurance Fund).
2)One-time administrative costs of about $200,000 to develop
policies and translate template documents by the DMHC (Managed
Care Fund).
COMMENTS:
1)PURPOSE OF THIS BILL. According to the author, the ACA
requires plans and insurers to provide consumers with an easy
to understand SBC to help them evaluate and compare their
health insurance options. The SBC includes key features of
coverage such as covered benefits, cost-sharing provisions,
and coverage limitations as well as a standard glossary of
terms. The author states that the ACA requires this
information to be provided in a culturally and linguistically
appropriate manner, but, unfortunately, federal standards on
translating the SBC are inconsistent with California's
translation requirements. The author states that this bill
makes clear that translation of the SBC must be consistent
with California's current language access laws, helping to
ensure that more Californians are informed about their health
coverage options and have equal access to critical information
about their health care.
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2)BACKGROUND.
a) SBC. The ACA sets forth specified disclosure
requirements to help consumers better understand their
health coverage, as well as to gain a better understanding
of other coverage options and an ability to compare plans.
One such disclosure requirement is for plans and insurers
to provide SBCs, and a uniform glossary of common terms
used in health coverage and medical care, to consumers so
that they may obtain summarized information about plan
benefits and coverage, and evaluate and compare their
health coverage options.
The SBC provides basic information regarding benefits and
coverage including specific cost-sharing information;
coverage limitations and exclusions; and, information
regarding continuity of coverage and grievances and
appeals. Under the ACA, consumers have the right to obtain
an SBC and uniform glossary when shopping for or enrolling
in coverage, and plans and insurers must provide the SBC
and uniform glossary in a culturally and linguistically
appropriate manner.
The ACA requires the federal Health and Human Services, the
Treasury, and the DOL (collectively referred to as the
Departments) to develop SBC and uniform glossary standards
for use by plans and insurers offering group and individual
coverage. The Departments published proposed regulations
in December 2011 to implement the SBC standards, along with
a proposed SBC template to be used by plans and insurers.
After consideration of comments from the public, the
Departments published joint final regulations implementing
specified disclosures, accompanied by an SBC template,
instructions, and related material.
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On December 30, 2014, the Departments issued a new set of
proposed regulations, as well as a revised SBC template.
The Departments released final SBC regulations on June 12,
2015. However, the new SBC template will not be finalized
until January 2016 in order to allow for consumer testing
and more public comment. Once finalized, the new SBC
template will apply to coverage that would renew or
commence for plan years on or after January 1, 2017.
b) FEDERAL AND STATE LANGUAGE ACCESS. Under federal
language access rules, plans and insurers must translate
the SBC and uniform glossary if 10% or more of the
population in a county is literate in the same non-English
language. According to the Centers for Medicare and
Medicaid Services, based on these rules, two languages in
California would meet the thresholds for written
translations: Spanish and Chinese. Twenty-five California
counties meet the 10%t threshold requirement to translate
SBCs in Spanish. Those counties are: Colusa, Fresno,
Glenn, Imperial, Kern, Kings, Los Angeles, Madera, Merced,
Monterey, Napa, Orange, Riverside, San Benito, San
Bernardino, San Diego, San Joaquin, San Mateo, Santa
Barbara, Santa Cruz, Stanislaus, Sutter, Tulare, Ventura,
and Yolo. One county, San Francisco, meets the 10%
threshold requirement to translate SBCs in Chinese.
California law requires vital documents to be translated
when an LEP enrollee represents a certain percentage of the
plan's enrollment. Specifically, plans and insurers must
assess the linguistic needs of the enrollee or insured
population, and translate vital documents in threshold
languages based on the sizes of enrollment and the needs
assessment. For example, a plan with enrollment of 1
million or more is required to translate vital documents
into the top two languages other than English as determined
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by the needs assessment, and any additional languages when
0.75% or 15,000 enrollees, whichever is less, indicates a
preference for written materials in their language.
According to DMHC, 10 languages qualify as meeting language
access thresholds under California's translation
requirements for vital documents. Those languages are
Spanish, Vietnamese, Chinese, Korean, Tagalog, Russian,
Armenian, Khmer, Arabic, and Hmong.
This bill requires DMHC and CDI to develop and post
templates of the SBC translated into Medi-Cal threshold
languages, except for those already translated by the DOL
(Chinese, Spanish, Navajo, and Tagalog). DHCS is
responsible for promulgating standards that Medi-Cal
managed care health plans must apply to determine which
languages, at a minimum, they must use to provide
translated materials to enrollees. Specifically, DHCS
qualifies a language as a threshold language for the
purposes of translation when 3,000, or 5% of the
beneficiary population in a service area indicate a primary
language other than English; or when 1,000 beneficiaries in
a single zip code, or 1,500 in two contiguous zip codes
speak a primary language other than English.
On April 27, 2014, DHCS released an All-Plan Letter, which,
in addition to English, lists the following languages as
the current set of Medi-Cal threshold languages: Arabic,
Armenian, Cambodian, Chinese, Farsi, Hmong, Korean,
Russian, Spanish, Tagalog, and Vietnamese.
3)SUPPORT. The California Pan-Ethnic Health Network (CPEHN) is
the sponsor of this bill. CPEHN states that although the ACA
expanded coverage for millions of Californians, consumers are
still confused about health insurance terminology and do not
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fully understand key details of their plans and policies.
CPEHN argues that this bill will ensure LEP consumers can
access vital information included in the SBCs by expanding the
languages into which it will be translated; ensure health
plans are meeting their language access obligations; improve
access to language assistance services; and help ensure
Californians can access a standardized glossary of insurance
terms. Other supporters state that California is extremely
diverse, with over 100 languages spoken and 40% of the
population comprised by LEP individuals. Supporters state
that the SBC forms are important tools for consumers, and help
them make sense of health care coverage, and that consumers'
new right to the SBC under the ACA means they finally have a
uniform document that can be used to reliably compare plans
and policies, and obtain important coverage information.
Supporters argue that this bill ensures that the SBC is
available to all Californians, not just those who speak
English, and moves California steps forward by ensuring one of
the most basic and informative documents is translated and of
use to millions of LEP Californians who rely on insurance for
their health.
4)PREVIOUS LEGISLATION.
a) SB 353 (Lieu), Chapter 447, Statutes of 2013, requires
the translation of specified documents by trained and
qualified translators when a health plan, insurer, or any
other person or business markets or advertises health
insurance products in the individual or small group markets
in a non-English language that is not a threshold language
under existing law.
b) SB 853 (Escutia), Chapter 713, Statutes of 2003,
required DMHC to adopt, not later than January 1, 2006,
regulations establishing standards and requirements to
provide health plan enrollees with access to language
assistance in obtaining health care services.
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5)POLICY COMMENTS.
a) Timeframes. This bill would require DMHC and CDI to
develop and post translated templates of the SBC no later
than July 1, 2016. According to the author, these
requirements are designed to provide assistance to plans
and insurers by providing access to translated templates
for them to use for their SBCs. However, by making the SBC
a vital document on July 1, 2016, thus requiring the SBC to
be translated by that same date, the bill does not appear
to allow time for the plans to use the templates unless
both DMHC and CDI develop and post the templates in advance
of their own deadline. The author may wish to amend the
bill to provide plans and insurers additional time to
access and utilize the templates by delaying the date by
which the SBC becomes a vital document. Open enrollment
for the 2017 plan year commences on November 1, 2016.
Consumers should be able to obtain access to the translated
SBCs in advance of the commencement of open enrollment.
Thus, the author may wish to amend the bill to make the SBC
document a vital document by October 1, 2016.
b) Technical amendment. The author has asked for the
following technical amendments on Page 8, lines 24 to 27 as
follows:
"?has already prepared a written translation. Not later
than July 1, 2016, the department commissioner shall make
available on its Internet Web site written translations
of the template uniform summary of benefits and coverage
developed by the department commissioner , and written?"
REGISTERED SUPPORT / OPPOSITION:
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Support
California Pan-Ethnic Health Network (sponsor)
American Cancer Society-Cancer Action Network
American Federation of State, County and Municipal Employees,
AFL-CIO
Asian Law Alliance
California Council of the Service Employees International Union
California Immigrant Policy Center
Community Health Councils
Consumers Union
National Health Law Program
SEIU-California
Southeast Asia Resource Action Center
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Western Center on Law and Poverty
Opposition
None on file.
Analysis Prepared by:Kelly Green / HEALTH / (916)
319-2097