Amended in Assembly June 30, 2016

Amended in Assembly July 16, 2015

Amended in Senate May 5, 2015

Amended in Senate April 20, 2015

Senate BillNo. 503


Introduced by Senator Hernandez

February 26, 2015


An act to amend begin delete Sections 1366.22 and 24100 of, and to amend, repeal, and add Sections 1366.24 and 1366.25 of, the Health and Safety Code, and to amend Section 10128.52 of, and to amend, repeal, and add Sections 10128.54 and 10128.55 of, the Insurance Code, relating to health care coverage.end delete begin insert Section 1418.8 of the Health and Safety Code, relating to health facilities.end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 503, as amended, Hernandez. begin deleteCal-COBRA: disclosures. end deletebegin insertLong-term health facilities: informed consent.end insert

begin insert

Existing law requires the attending physician of a resident in a skilled nursing facility or intermediate care facility that prescribes or orders a medical intervention of a resident that requires the informed consent of a patient who lacks the capacity to provide that consent, as specified, to inform the skilled nursing facility or intermediate care facility. Existing law requires the facility to conduct an interdisciplinary team review of the prescribed medical intervention prior to the administration of the medical intervention, subject to specified proceedings. Existing law authorizes a medical intervention prior to the facility convening an interdisciplinary team review in the case of an emergency, under specified circumstances. Existing law requires the team to meet within one week of the emergency for an evaluation of the medical intervention if the emergency results in the application of physical or chemical restraints. Existing law imposes civil penalties for a violation of these provisions.

end insert
begin insert

This bill would expand the above-described process, as specified, and would impose additional duties on a physician who prescribes a medical intervention under these provisions and on skilled nursing facilities and intermediate care facilities, as defined, under these provisions. Among other things, the bill would require a physician who prescribes a medical intervention to document certain information in the medical record of the resident. The bill would require a skilled nursing facility or intermediate care facility to notify the resident of a determination of a physician pursuant to the above within 48 hours of his or her determination, as prescribed. The bill would authorize a patient or representative of the patient, as described, to take certain action in response to a medical intervention. Under circumstances in which an emergency results in the application of physical or chemical restraints, or the administration of antipsychotic medications, the bill would require the interdisciplinary team to meet for an evaluation of the emergency intervention. The bill would impose additional requirements on the administration of antipsychotic medications by a facility, as prescribed, which would include, among other things, an independent medical review of the appropriateness of the proposed medical intervention.

end insert
begin delete

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. The California Continuation Benefits Replacement Act (Cal-COBRA) requires health care service plans and health insurers providing coverage under a group benefit plan to employers of 2 to 19 eligible employees to offer a continuation of that coverage for a specified period of time to certain qualified beneficiaries, as specified. Existing law requires a group benefit plan that is subject to Cal-COBRA to make specified disclosures to covered employees, including that a covered employee who is considering declining continuation of coverage should be aware that companies selling individual health insurance may require a review of the employee’s medical history that could result in a higher premium or denial of coverage.

end delete
begin delete

This bill would eliminate the disclosure requirement described above. If federal law requiring an individual to maintain minimum health coverage is repealed or amended to no longer apply to the individual market, as specified, the bill would reenact that disclosure requirement to become operative 12 months after that repeal or amendment. The bill would also, under those same conditions, require a contract between a group benefit plan that is subject to Cal-COBRA and an employer to require the employer to make the same disclosure to a qualified beneficiary in connection with a notice regarding election of continuation coverage. The bill would require a group benefit plan that is subject to Cal-COBRA and that issues, amends, or renews a disclosure on or after July 1, 2016, to include a notice regarding additional health care coverage options in that disclosure, as specified. The bill would require a group contract that is issued, amended, or renewed on or after July 1, 2016, between a group benefit plan that is subject to Cal-COBRA and an employer to require the employer to give that notice regarding additional health care coverage options to a qualified beneficiary of the contract in connection with a notice regarding election of continuation coverage. The bill would make conforming changes to related provisions.

end delete
begin delete

Because a willful violation of the bill’s requirements relative to health care service plans would be a crime, this bill would impose a state-mandated local program.

end delete
begin delete

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 delete
begin delete

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

end delete

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

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

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 1418.8 of the end insertbegin insertHealth and Safety Codeend insertbegin insert is
2amended to read:end insert

3

1418.8.  

(a) begin insert(1)end insertbegin insertend insertIf the attending physicianbegin delete and surgeonend delete of a
4resident in a skilled nursing facility or intermediate carebegin delete facilityend delete
5begin insert facility, as defined in paragraphs (1) to (5), inclusive, of
6subdivision (a) of Section 1418 or in subdivision (c) of Section
71418,end insert
prescribes or orders a medical intervention that requires that
P4    1informed consent be obtained prior to administration of the medical
2begin delete intervention,end deletebegin insert interventionend insert but is unable to obtain informed consent
3because the physicianbegin delete and surgeonend delete determines that the resident
4lacks capacity to make decisions concerning his or her health care
5and that there is no person with legal authority to make those
6decisions on behalf of the resident, the physicianbegin delete and surgeonend delete shall
7inform the skilled nursing facility or intermediate care facility.
8
begin insert After informing the skilled nursing facility or intermediate care
9facility of the need for medical intervention, the unavailability of
10a person with legal authority to make medical treatment decisions
11on behalf of a resident, and the determination that the resident
12lacks capacity to give informed consent for the proposed
13interventions, the physician shall document in writing that the
14skilled nursing facility or intermediate care facility has been
15informed of these determinations. This writing shall be placed or
16be contained in the medical record of the resident.end insert

begin insert

17
(2) The skilled nursing facility or intermediate care facility
18shall, orally and in writing, notify the resident of the determinations
19of the physician as soon as possible after the physician has
20informed the facility of the determinations, but no later than 48
21hours. Notice provided to a resident pursuant to this section shall
22be in the resident’s preferred language.

end insert

23(b) For purposes of subdivision (a), a resident lacks capacity to
24makebegin delete a decisionend deletebegin insert decisionsend insert regarding his or her health care if the
25resident is unable to understand the nature and consequences of
26the proposed medical intervention, including its risks and benefits,
27or is unable to express a preference regarding the intervention. To
28make the determination regarding capacity, the physician shall
29interview thebegin delete review the patient’s medical records,end deletebegin insert resident, review
30the resident’s medical records available at the facility or readily
31available through electronic means,end insert
and consult with skilled
32nursingbegin insert facility staffend insert or intermediate care facility staff, as
33appropriate, and family members and friends of the resident, if
34any have been identified.

35(c) For purposes of subdivision (a), a person with legal authority
36to make medical treatment decisions on behalf of abegin delete patientend deletebegin insert residentend insert
37 is a person designatedbegin delete underend deletebegin insert inend insert a validbegin delete Durable Power of Attorney
38for Health Care, a guardian, a conservator, or next of kin.end delete
begin insert writing
39authorized by the Probate Code, including a durable power of
40attorney for health care or advance health care directive or a
P5    1guardian, conservator, next of kin, or any other person designated
2by law to serve as a person with legal authority to make medical
3treatment decisions for the resident.end insert
To determine the existence
4of a person with legal authority, the physician shall interview the
5begin delete patient,end deletebegin insert resident,end insert review the medical records of thebegin delete patient,end deletebegin insert resident,end insert
6 and consult withbegin insert theend insert skilled nursingbegin insert facility staffend insert or intermediate
7care facility staff, as appropriate, and with family members and
8friends of the resident, if any have been identified.begin insert Notwithstanding
9Section 4655 of the Welfare and Institutions Code, a regional
10center director or his or her designee shall not have the legal
11authority to make medical treatment decisions pursuant to
12subdivisions (o), (p), and (r) of this section.end insert

13(d) The attending physician and the skilled nursing facility or
14intermediate care facilitybegin insert defined in subdivision (a)end insert may initiate a
15medical intervention that requires informed consent pursuant to
16subdivision (e) in accordance with acceptable standards ofbegin delete practice.end delete
17
begin insert practice and only after the notice in paragraph (2) of subdivision
18(a) has been provided to the resident and the resident has not
19initiated any judicial review of any of the physician’s
20determinations.end insert

21(e) begin deleteWhere end deletebegin insertIf end inserta resident of a skilled nursing facility or
22intermediate care facility has been prescribed a medical
23intervention by a physicianbegin delete and surgeonend delete that requires informed
24consentbegin insert of the residentend insert and the physician has determined that the
25resident lacks capacity to make health care decisions and there is
26no person with legal authority to make thosebegin insert medical interventionend insert
27 decisions on behalf of the resident, the facility shall, except as
28provided in subdivisionbegin delete (h),end deletebegin insert (j),end insert conduct an interdisciplinary team
29review of the prescribed medical intervention prior to the
30administration of the medical intervention. The interdisciplinary
31team shall oversee the care of the resident utilizing a team approach
32to assessment and care planning, and shall include the resident’s
33attending physician, a registered professional nurse with
34responsibility for the resident, other appropriate staff in disciplines
35as determined by the resident’s needs, and, where practicable, a
36begin delete patientend deletebegin insert residentend insert representative, in accordance with applicable
37federal and state requirements.begin insert For residents eligible for and
38receiving regional center services under Division 4.5 (commencing
39with Section 4500) of the Welfare and Institutions Code, the
P6    1interdisciplinary team may include the resident’s regional center
2service coordinator.end insert
The review shall include all of the following:

3(1) A review of the physician’s assessment of the resident’s
4condition.

5(2) The reason for the proposed use of the medical intervention.

6(3) Abegin delete discussion of the desires of the patient, whereend delete
7begin insert consideration of the preferences of the resident, ifend insert known. To
8determine thebegin delete desiresend deletebegin insert preferencesend insert of the resident, the
9interdisciplinary team shall interview thebegin delete patient,end deletebegin insert resident,end insert review
10thebegin delete patient’send deletebegin insert resident’send insert medical records,begin insert including the resident’s
11durable power of attorney and advanced health care directive,end insert

12 and consult with family members or friends, if any have been
13identified.

14(4) The type of medical intervention to be used in the resident’s
15care, including its probable frequency and duration.

16(5) The probable impact on the resident’s condition, with and
17without the use of thebegin insert proposedend insert medical intervention.

18(6) Reasonable alternative medical interventions considered or
19utilized and reasons for their discontinuance or inappropriateness.

20(f) Abegin delete patientend deletebegin insert residentend insert representative may include a family
21member or friend of the resident who is unable to take full
22responsibility for the health care decisions of the resident, but who
23has agreed to serve on the interdisciplinary team, or other person
24authorized by state or federal law.

25(g) The interdisciplinary team shall periodically evaluate the
26use of the prescribed medical intervention at least quarterly or
27upon a significant change in the resident’s medical condition.begin insert Any
28ongoing or additional prescribed medical interventions shall
29continue to be overseen using the interdisciplinary team approach
30unless or until a person with legal authority to make decisions
31regarding medical treatment on behalf of the resident, as defined
32in subdivision (c), is identified or the physician or a court of law
33determines that the resident has capacity, or has regained capacity,
34to make decisions concerning a proposed medical intervention.end insert

begin insert

35
(h) For purposes of paragraph (2) of subdivision (a), the written
36notice provided to the resident by the skilled nursing facility or
37intermediate care facility shall be developed in plain English in a
38manner easily understandable to residents and shall include all
39of the following information, and be translated into the preferred
40language of the resident:

end insert
begin insert

P7    1
(1) The medical intervention prescribed or ordered for the
2resident by the physician.

end insert
begin insert

3
(2) A physician has determined that the resident is unable to
4understand the nature and consequences of the prescribed or
5ordered medical intervention, including its risks and benefits, or
6is unable to express a preference and therefore lacks capacity to
7make decisions regarding the prescribed or ordered medical
8intervention.

end insert
begin insert

9
(3) No person with legal authority to make decisions regarding
10medical interventions on behalf of the resident has been identified,
11or, if identified, the person has declined to serve as a health care
12decisionmaker.

end insert
begin insert

13
(4) A physician, a registered nurse with responsibility for the
14resident, other appropriate facility staff in disciplines as
15determined by the resident’s needs, and, if practicable, a person
16representing the resident’s interests shall review the determinations
17and prescribed medical intervention and shall review on at least
18a quarterly basis or upon a significant change in the resident’s
19medical condition.

end insert
begin insert

20
(5) Any additional prescribed interventions shall continue to
21be overseen using the interdisciplinary team approach unless or
22until a person with legal authority to make decisions regarding
23medical interventions on behalf of the resident, as defined in
24subdivision (c), is identified, or the physician or a court of law
25determines that the resident has capacity, or has regained capacity,
26to make decisions concerning a prescribed medical intervention.

end insert
begin insert

27
(6) The resident may seek appropriate judicial relief to review
28any of the determinations of the physician, as set forth in this
29subdivision.

end insert
begin insert

30
(7) Information on availability of advocacy assistance, including
31the protection and advocacy agency identified in subdivision (i)
32of Section 4900 of the Welfare and Institutions Code, publicly
33funded legal services corporations, and other publicly or privately
34funded advocacy organizations, and, for residents who are clients
35of a regional center, information about their local client’s rights
36advocate pursuant to Section 4433 of the Welfare and Institutions
37Code.

end insert
begin insert

38
(i) If a skilled nursing facility or intermediate care facility has
39provided written notice to a resident who is currently receiving a
40medical intervention under this section but for which that medical
P8    1intervention was initiated by the skilled nursing facility or
2intermediate care facility prior to the effective date of this
3subdivision, and the written notice provided to the resident includes
4all of the information set forth in subdivision (h), the written notice
5shall be considered sufficient for purposes of satisfying the
6requirements for written notice to a resident in paragraph (2) of
7subdivision (a). Nothing in this subdivision shall require the skilled
8nursing facility or intermediate care facility to discontinue the
9intervention in order for notice to be provided consistent with
10subdivision (h).

end insert
begin delete

11(h)

end delete

12begin insert(j)end insert In case of an emergency, after obtaining abegin delete physician and
13surgeon’send delete
begin insert physician’send insert orderbegin insert under subdivision (a),end insert as necessary,
14a skilled nursingbegin insert facilityend insert or intermediate care facility may
15administer a medical intervention that requires informed consent
16prior to the facility convening an interdisciplinary team review. If
17the emergency results in the application of physical or chemical
18restraints,begin delete theend deletebegin insert or the emergency administration of antipsychotic
19medication, theend insert
interdisciplinary team shall meetbegin delete within one week
20of the emergencyend delete
for an evaluation of thebegin delete medical intervention.end delete
21
begin insert emergency intervention, and shall comply with the timelines
22outlined in paragraph (3) of subdivision (r).end insert

begin delete

23(i)

end delete

24begin insert(k)end insert Physiciansbegin delete and surgeonsend delete and skilled nursing facilities and
25intermediate care facilities shall not be required to obtain a court
26order pursuant to Section 3201 of the Probate Code prior to
27administering a medical interventionbegin delete whichend deletebegin insert thatend insert requires informed
28consent if the requirements of this section arebegin delete met.end deletebegin insert met and only
29after the notice required in paragraph (2) of subdivision (a) has
30been provided to the resident.end insert

begin delete

31(j)

end delete

32begin insert(l)end insert Nothing in this section shall in any way affect the right of a
33resident of a skilled nursing facility or intermediate care facility
34for whom medical intervention has been prescribed, ordered, or
35administered pursuant to this section to seek appropriate judicial
36relief to review the decision to provide the medical intervention.

begin delete

37(k)

end delete

38begin insert(m)end insert No physician or other health care provider,begin insert including the
39independent physician, as described in subdivision (r),end insert
whose
40action under this section is in accordance with reasonable medical
P9    1standards, is subject to administrative sanction if the physician or
2health care provider believes in good faith that the action is
3consistent with this section and the desires of the resident, or if
4unknown, the best interests of the resident.begin insert Notwithstanding any
5other law, there shall not be monetary liability on the part of, and
6there shall not be a cause of action for damages arising against,
7an independent physician for any act performed during the review
8of a medical intervention for antipsychotic medication prescribed
9or ordered for a resident, as provided in subdivision (r), if the
10independent physician acts without malice, has made a reasonable
11effort to obtain the facts of the matter, and approves or disapproves
12the medical intervention for antipsychotic medications as
13warranted by the facts.end insert

begin delete

14(l)

end delete

15begin insert(n)end insert The determinations required to be made pursuant to
16subdivisions (a), (e), and (g), and the basis for thosebegin delete determinationsend delete
17begin insert determinations,end insert shall be documented in thebegin delete patient’send deletebegin insert resident’send insert
18 medical record and shall be made available to thebegin delete patient’send delete
19begin insert resident’send insert representative for review.begin insert A copy of the written notice
20to the resident of the determinations, as set forth in subdivision
21(h), shall be retained in the resident’s medical record, along with
22written acknowledgment by the resident of his or her receipt of
23the written notice if provided, or documentation by the skilled
24nursing facility or intermediate care facility that the resident has
25received the notice. The written notice and acknowledgment of the
26resident’s receipt of the written notice, and the documentation in
27the resident’s medical record of the determinations made pursuant
28to subdivisions (a), (e), and (g), shall be made available to the
29resident or the resident’s representative for review or copying,
30upon request.end insert

begin insert

31
(o) Nothing in this section shall authorize a skilled nursing
32facility, intermediate care facility, or the physician to make
33decisions regarding the withholding or withdrawal of potentially
34life-sustaining treatment for a resident, except to the extent
35consistent with the resident’s individual health care instructions,
36if any, and other wishes, to the extent known; provided, however,
37that a physician or facility may decline to comply with an
38individual health care instruction or health care decision that
39requires medically ineffective health care or health care contrary
40to generally accepted health care standards applicable to the
P10   1physician or facility pursuant to Sections 4735 and 4736 of the
2Probate Code.

end insert
begin insert

3
(p) Notwithstanding subdivision (o), the procedures in
4subdivision (e) may be used to provide or initiate hospice or
5comfort care to a resident unless inconsistent with the resident’s
6individual health care instructions, if any, and other expressed
7wishes, to the extent known, or if that care would not be in the
8resident’s best interests.

end insert
begin insert

9
(q) The skilled nursing facility or intermediate care facility shall
10develop, adopt, and implement policies and procedures for the
11administration of an antipsychotic medication to a resident. The
12policies and procedures shall include procedures for the emergency
13administration of an antipsychotic medication to a resident to the
14extent allowed by this section and shall be developed prior to the
15emergency administration of an antipsychotic medication.

end insert
begin insert

16
(r) The policies and procedures required pursuant to subdivision
17(q) that are adopted by the facility regarding the administration
18of antipsychotic medication shall include all of the following:

end insert
begin insert

19
(1) Prior to the administration of an antipsychotic medication
20to a resident, the skilled nursing facility or intermediate care
21facility shall convene a review at the facility before an independent
22physician in order to review the appropriateness of the proposed
23medical intervention. The review shall be provided at no cost to
24the resident.

end insert
begin insert

25
(2) The review by the independent physician shall be held at
26the facility or by videoconferencing technology no earlier than
27seven days after notice is provided to the resident as required by
28paragraph (2) of subdivision (a).

end insert
begin insert

29
(3) If an antipsychotic medication has been administered for
30an emergency purpose pursuant to subdivision (j), the skilled
31nursing facility or the intermediate care facility shall, within 14
32days of the initial administration of the antipsychotic medication
33to the resident, do all of the following:

end insert
begin insert

34
(A) Require the interdisciplinary team to meet and evaluate the
35medical intervention, and determine whether the team has found
36the intervention to be appropriate.

end insert
begin insert

37
(B) Provide the resident with a review before an independent
38physician, pursuant to this subdivision.

end insert
begin insert

39
(C) Require the independent physician to provide a written
40decision pursuant to paragraph (10).

end insert
begin insert

P11   1
(D) Provide the independent physician’s decision to the resident,
2the resident’s advocate, and the resident’s representative, if one
3has been identified in subdivision (e), pursuant to paragraph (11).

end insert
begin insert

4
(4) The independent physician shall be licensed by the state and
5shall be retained by the facility at no charge to the patient. The
6independent physician shall meet the following requirements:

end insert
begin insert

7
(A) Be knowledgeable in the clinical indications, use,
8administration, risks, and benefits of antipsychotic medications.

end insert
begin insert

9
(B) Not currently provide or have previously provided any health
10care services to the resident.

end insert
begin insert

11
(C) Not currently serve or have previously served on any
12committee to review either the health care services or the policies
13and procedures of the skilled nursing facility or intermediate care
14facility.

end insert
begin insert

15
(D) Not be employed by the licensee, skilled nursing facility,
16intermediate care facility, or any of the licensee’s health care
17facilities.

end insert
begin insert

18
(E) Not have any ownership interest in the skilled nursing facility
19or intermediate care facility or in any of the licensee’s business
20entities or health care facilities.

end insert
begin insert

21
(F) Not be financially compensated by the licensee or the
22facility, other than to provide the review regarding the proposed
23medical intervention, as contemplated in this subdivision.

end insert
begin insert

24
(5) (A) A resident may retain an advocate, of his or her own
25choice, to represent his or her interests at the review before the
26independent physician. If the resident does not retain an advocate,
27the skilled nursing or intermediate care facility shall provide, at
28no expense to the resident, an advocate to assist the resident at
29the review. Any advocate supplied by the facility shall have at least
30the following minimum qualifications:

end insert
begin insert

31
(i) Experience in patient or client advocacy in a medical setting.

end insert
begin insert

32
(ii) Experience in capacity, guardianship, or conservatorship
33proceedings.

end insert
begin insert

34
(iii) Knowledge of disability rights, patients’ rights, or mental
35health law.

end insert
begin insert

36
(iv) Close proximity or willingness to travel to the skilled nursing
37 facilities or intermediate care facilities where the review will take
38place.

end insert
begin insert

39
(B) An advocate provided by the facility shall, under contract
40with the facility, provide advocacy services to any resident for the
P12   1sole purpose of assistance and representation at reviews
2contemplated in this subdivision. An advocate provided by the
3facility shall not be employed by or otherwise contract with the
4licensee, skilled nursing facility, intermediate care facility, or any
5of the licensee’s business entities or health care facilities. An
6advocate provided by the facility to a resident shall not have any
7ownership interest in the facility or in any of the licensee’s business
8entities or health care facilities. The advocate shall not be
9financially compensated by the licensee or facility, other than as
10allowed in this subdivision.

end insert
begin insert

11
(6) Written notice of the time, date, and location of the review
12 shall be provided by the facility to the resident, in the resident’s
13preferred language, and the resident’s advocate and a
14representative, if one has been identified, as described in
15subdivision (e), no later than five days before the review. The
16notice shall include all of the following:

end insert
begin insert

17
(A) The right to review or have copies of the resident’s medical
18records available at the facility, or readily available through
19electronic means, in advance of the review.

end insert
begin insert

20
(B) The procedures to be followed during the review, including
21the right to an interpreter if the resident’s preferred language is
22not English.

end insert
begin insert

23
(C) The opportunity to rebut any evidence presented by the
24physician or interdisciplinary team regarding the appropriateness
25of the proposed administration of an antipsychotic medication.

end insert
begin insert

26
(D) The right of the resident, the resident’s advocate or
27representative, and any witnesses to attend the review.

end insert
begin insert

28
(7) Within 24 hours of a request by the resident, the advocate,
29or a representative, if one has been identified, as described in
30subdivision (e), the skilled nursing facility or intermediate care
31facility shall provide access to, and, if requested, copies of, the
32resident’s medical records available at the facility, or readily
33available through electronic means.

end insert
begin insert

34
(8) At the independent physician review, the resident, with the
35assistance of the resident’s advocate and a representative, if one
36has been identified, the physician who ordered the proposed
37administration of an antipsychotic medication, and a representative
38of the interdisciplinary team shall be given a reasonable and equal
39opportunity to present information concerning the appropriateness
40of the proposed administration of an antipsychotic medication and
P13   1an equal and reasonable opportunity to question the physician
2who ordered the proposed antipsychotic medical intervention,
3members of the interdisciplinary team, and any witnesses.

end insert
begin insert

4
(9) Except as provided in paragraph (3) of subdivision (r),
5within seven days of the conclusion of a review, the independent
6physician shall make a decision either approving or disapproving
7the proposed administration of an antipsychotic medication. The
8decision shall be in writing and shall include the basis for the
9decision and the evidence relied upon.

end insert
begin insert

10
(10) (A) A written copy of the independent physician’s decision
11shall be provided to the resident, in the resident’s preferred
12language, and the resident’s advocate and representative, if one
13has been identified, as described in subdivision (e), by the skilled
14nursing facility or intermediate care facility. The notice shall also
15advise the resident that the resident has a right to seek judicial
16review of the independent physician’s decision to approve or
17disapprove any prescribed or ordered medical intervention
18requiring the administration of antipsychotic medication and
19information on availability of advocacy assistance, including the
20protection and advocacy agency identified in subdivision (i) of
21Section 4900 of the Welfare and Institutions Code, publicly funded
22legal services corporations, and other publicly or privately funded
23advocacy organizations. Written notice provided to a resident
24pursuant to this section shall be translated to the preferred
25language of the resident.

end insert
begin insert

26
(B) Except in the case of emergency administration of
27antipsychotic medication to a resident, the facility shall not
28administer an antipsychotic medication following the independent
29 review until the resident, the resident’s advocate, and the resident’s
30representative receive written copies of the independent physician’s
31decision.

end insert
begin insert

32
(11) The independent review of administration of any prescribed
33or ordered antipsychotic medication to a resident, pursuant to this
34section, shall only be required if the antipsychotic medication
35proposed to be administered is either prescribed for the first time
36while the resident is a patient of the skilled nursing or intermediate
37care facility or has not previously been subject to a review and
38hearing by an independent physician, as provided for in this
39subdivision, but for which the antipsychotic medication was
40prescribed pursuant to subdivision (a).

end insert
begin insert

P14   1
(12) Every two years from the administration of an antipsychotic
2 medication, the resident and the resident’s representative, if one
3has been identified in subdivision (e), shall be notified in writing
4of the intent to continue administration of an antipsychotic
5medication for the resident’s medical condition, and the resident’s
6right to request a review by an independent physician pursuant to
7this section. Notice provided to a resident pursuant to this section
8shall be developed in plain English in a manner easily
9understandable to residents and be in the resident’s primary
10language.

end insert
begin insert

11
(s) “Antipsychotic medication” means a medication approved
12by the United States Food and Drug Administration for the
13treatment of psychosis.

end insert
begin insert

14
(t) Nothing in subdivision (r) shall be construed to alter or
15impact the rights of residents pertaining to capacity hearings
16required by the Lanterman-Petris-Short Act (Part 1 (commencing
17with Section 5000) of Division 5 of the Welfare and Institutions
18Code), as set forth in Article 7 (commencing with Section 5325)
19of that act.

end insert
begin insert

20
(u) All records of the review by the independent physician shall
21be retained in the resident’s medical record, and the department
22shall have access to, and may inspect, these records.

end insert
begin delete
23

SECTION 1.  

Section 1366.22 of the Health and Safety Code
24 is amended to read:

25

1366.22.  

The continuation coverage requirements of this article
26do not apply to the following individuals:

27(a) Individuals who are entitled to Medicare benefits or become
28entitled to Medicare benefits pursuant to Title XVIII of the United
29States Social Security Act, as amended or superseded. Entitlement
30to Medicare Part A only constitutes entitlement to benefits under
31Medicare.

32(b) Individuals who have other hospital, medical, or surgical
33coverage or who are covered or become covered under another
34group benefit plan, including a self-insured employee welfare
35benefit plan, that provides coverage for individuals and that does
36not impose any exclusion or limitation with respect to any
37preexisting condition of the individual, other than a preexisting
38condition limitation or exclusion that does not apply to or is
39satisfied by the qualified beneficiary pursuant to Sections 1357
40and 1357.06. A group conversion option under any group benefit
P15   1plan shall not be considered as an arrangement under which an
2individual is or becomes covered.

3(c) Individuals who are covered, become covered, or are eligible
4for federal COBRA coverage pursuant to Section 4980B of the
5United States Internal Revenue Code or Chapter 18 of the
6Employee Retirement Income Security Act (29 U.S.C. Sec. 1161
7et seq.).

8(d) Individuals who are covered, become covered, or are eligible
9for coverage pursuant to Chapter 6A of the Public Health Service
10Act (42 U.S.C. Sec. 300bb-1 et seq.).

11(e) Qualified beneficiaries who fail to meet the requirements of
12subdivision (b) of Section 1366.24 or subdivision (i) of Section
131366.25 regarding notification of a qualifying event or election of
14continuation coverage within the specified time limits.

15(f) Except as provided in Section 3001 of ARRA, qualified
16beneficiaries who fail to submit the correct premium amount
17required by subdivision (b) of Section 1366.24 and Section
181366.26, in accordance with the terms and conditions of the plan
19contract, or fail to satisfy other terms and conditions of the plan
20 contract.

21

SEC. 2.  

Section 1366.24 of the Health and Safety Code is
22amended to read:

23

1366.24.  

(a) Every health care service plan evidence of
24coverage, provided for group benefit plans subject to this article,
25that is issued, amended, or renewed on or after January 1, 1999,
26shall disclose to covered employees of group benefit plans subject
27to this article the ability to continue coverage pursuant to this
28article, as required by this section.

29(b) This disclosure shall state that all enrollees who are eligible
30to be qualified beneficiaries, as defined in subdivision (c) of
31Section 1366.21, shall be required, as a condition of receiving
32benefits pursuant to this article, to notify, in writing, the health
33care service plan, or the employer if the employer contracts to
34perform the administrative services as provided for in Section
351366.25, of all qualifying events as specified in paragraphs (1),
36(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
37days of the date of the qualifying event. This disclosure shall
38inform enrollees that failure to make the notification to the health
39care service plan, or to the employer when under contract to
40provide the administrative services, within the required 60 days
P16   1will disqualify the qualified beneficiary from receiving continuation
2coverage pursuant to this article. The disclosure shall further state
3that a qualified beneficiary who wishes to continue coverage under
4the group benefit plan pursuant to this article shall request the
5continuation in writing and deliver the written request, by first-class
6mail, or other reliable means of delivery, including personal
7delivery, express mail, or private courier company, to the health
8care service plan, or to the employer if the plan has contracted
9with the employer for administrative services pursuant to
10subdivision (d) of Section 1366.25, within the 60-day period
11following the later of (1) the date that the enrollee’s coverage under
12the group benefit plan terminated or will terminate by reason of a
13qualifying event, or (2) the date the enrollee was sent notice
14pursuant to subdivision (e) of Section 1366.25 of the ability to
15continue coverage under the group benefit plan. The disclosure
16required by this section shall also state that a qualified beneficiary
17electing continuation shall pay to the health care service plan, in
18accordance with the terms and conditions of the plan contract,
19which shall be set forth in the notice to the qualified beneficiary
20pursuant to subdivision (d) of Section 1366.25, the amount of the
21required premium payment, as set forth in Section 1366.26. The
22disclosure shall further require that the qualified beneficiary’s first
23premium payment required to establish premium payment be
24delivered by first-class mail, certified mail, or other reliable means
25of delivery, including personal delivery, express mail, or private
26courier company, to the health care service plan, or to the employer
27if the employer has contracted with the plan to perform the
28administrative services pursuant to subdivision (d) of Section
291366.25, within 45 days of the date the qualified beneficiary
30provided written notice to the health care service plan or the
31employer, if the employer has contracted to perform the
32administrative services, of the election to continue coverage in
33order for coverage to be continued under this article. This
34disclosure shall also state that the first premium payment shall
35equal an amount sufficient to pay any required premiums and all
36premiums due, and that failure to submit the correct premium
37amount within the 45-day period will disqualify the qualified
38beneficiary from receiving continuation coverage pursuant to this
39article.

P17   1(c) The disclosure required by this section shall also describe
2separately how qualified beneficiaries whose continuation coverage
3terminates under a prior group benefit plan pursuant to subdivision
4(b) of Section 1366.27 may continue their coverage for the balance
5of the period that the qualified beneficiary would have remained
6covered under the prior group benefit plan, including the
7requirements for election and payment. The disclosure shall clearly
8state that continuation coverage shall terminate if the qualified
9beneficiary fails to comply with the requirements pertaining to
10enrollment in, and payment of premiums to, the new group benefit
11plan within 30 days of receiving notice of the termination of the
12prior group benefit plan.

13(d) Prior to August 1, 1998, every health care service plan shall
14provide to all covered employees of employers subject to this
15article a written notice containing the disclosures required by this
16section, or shall provide to all covered employees of employers
17subject to this section a new or amended evidence of coverage that
18includes the disclosures required by this section. Any specialized
19health care service plan that, in the ordinary course of business,
20maintains only the addresses of employer group purchasers of
21benefits and does not maintain addresses of covered employees,
22may comply with the notice requirements of this section through
23the provision of the notices to its employer group purchasers of
24benefits.

25(e) Every plan disclosure form issued, amended, or renewed on
26and after January 1, 1999, for a group benefit plan subject to this
27article shall provide a notice that, under state law, an enrollee may
28be entitled to continuation of group coverage and that additional
29information regarding eligibility for this coverage may be found
30in the plan’s evidence of coverage.

31(f) A disclosure issued, amended, or renewed on or after July
321, 2016, for a group benefit plan subject to this article shall include
33the following notice:

34

35“In addition to your coverage continuation options, you may be
36eligible for the following:

371. Coverage through the state health insurance marketplace, also
38known as Covered California. By enrolling through Covered
39California, you may qualify for lower monthly premiums and lower
P18   1out-of-pocket costs. Your family members may also qualify for
2coverage through Covered California.

32. Coverage through Medi-Cal. Depending on your income, you
4may qualify for low or no-cost coverage through Medi-Cal. Your
5family members may also qualify for Medi-Cal.

63. Coverage through an insured spouse. If your spouse has
7coverage that extends to family members, you may be able to be
8added on that benefit plan.

9Be aware that there is a deadline to enroll in Covered California,
10although you can apply for Medi-Cal at anytime. To find out more
11about how to apply for Covered California and Medi-Cal, visit the
12Covered California Internet Web site at
13 http://www.coveredca.com.”
14

15(g) (1) If Section 5000A of the Internal Revenue Code, as added
16by Section 1501 of PPACA, is repealed or amended to no longer
17apply to the individual market, as defined in Section 2791 of the
18federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
19section shall become inoperative and is repealed 12 months after
20the date of that repeal or amendment.

21(2) For purposes of this subdivision, “PPACA” means the federal
22Patient Protection and Affordable Care Act (Public Law 111-148),
23as amended by the federal Health Care and Education
24Reconciliation Act of 2010 (Public Law 111-152), and any rules,
25regulations, or guidance issued pursuant to that law.

26

SEC. 3.  

Section 1366.24 is added to the Health and Safety
27Code
, to read:

28

1366.24.  

(a) Every health care service plan evidence of
29coverage, provided for group benefit plans subject to this article,
30that is issued, amended, or renewed on or after January 1, 1999,
31shall disclose to covered employees of group benefit plans subject
32to this article the ability to continue coverage pursuant to this
33article, as required by this section.

34(b) This disclosure shall state that all enrollees who are eligible
35to be qualified beneficiaries, as defined in subdivision (c) of
36Section 1366.21, shall be required, as a condition of receiving
37benefits pursuant to this article, to notify, in writing, the health
38care service plan, or the employer if the employer contracts to
39perform the administrative services as provided for in Section
401366.25, of all qualifying events as specified in paragraphs (1),
P19   1(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
2days of the date of the qualifying event. This disclosure shall
3inform enrollees that failure to make the notification to the health
4care service plan, or to the employer when under contract to
5provide the administrative services, within the required 60 days
6will disqualify the qualified beneficiary from receiving continuation
7coverage pursuant to this article. The disclosure shall further state
8that a qualified beneficiary who wishes to continue coverage under
9the group benefit plan pursuant to this article must request the
10continuation in writing and deliver the written request, by first-class
11mail, or other reliable means of delivery, including personal
12delivery, express mail, or private courier company, to the health
13care service plan, or to the employer if the plan has contracted
14with the employer for administrative services pursuant to
15subdivision (d) of Section 1366.25, within the 60-day period
16following the later of (1) the date that the enrollee’s coverage under
17the group benefit plan terminated or will terminate by reason of a
18qualifying event, or (2) the date the enrollee was sent notice
19pursuant to subdivision (e) of Section 1366.25 of the ability to
20continue coverage under the group benefit plan. The disclosure
21required by this section shall also state that a qualified beneficiary
22electing continuation shall pay to the health care service plan, in
23accordance with the terms and conditions of the plan contract,
24which shall be set forth in the notice to the qualified beneficiary
25pursuant to subdivision (d) of Section 1366.25, the amount of the
26required premium payment, as set forth in Section 1366.26. The
27disclosure shall further require that the qualified beneficiary’s first
28premium payment required to establish premium payment be
29delivered by first-class mail, certified mail, or other reliable means
30of delivery, including personal delivery, express mail, or private
31courier company, to the health care service plan, or to the employer
32if the employer has contracted with the plan to perform the
33administrative services pursuant to subdivision (d) of Section
341366.25, within 45 days of the date the qualified beneficiary
35provided written notice to the health care service plan or the
36employer, if the employer has contracted to perform the
37administrative services, of the election to continue coverage in
38order for coverage to be continued under this article. This
39disclosure shall also state that the first premium payment must
40equal an amount sufficient to pay any required premiums and all
P19   1premiums due, and that failure to submit the correct premium
2amount within the 45-day period will disqualify the qualified
3beneficiary from receiving continuation coverage pursuant to this
4article.

5(c) The disclosure required by this section shall also describe
6separately how qualified beneficiaries whose continuation coverage
7terminates under a prior group benefit plan pursuant to subdivision
8(b) of Section 1366.27 may continue their coverage for the balance
9of the period that the qualified beneficiary would have remained
10covered under the prior group benefit plan, including the
11requirements for election and payment. The disclosure shall clearly
12state that continuation coverage shall terminate if the qualified
13beneficiary fails to comply with the requirements pertaining to
14enrollment in, and payment of premiums to, the new group benefit
15plan within 30 days of receiving notice of the termination of the
16prior group benefit plan.

17(d) Prior to August 1, 1998, every health care service plan shall
18provide to all covered employees of employers subject to this
19article a written notice containing the disclosures required by this
20section, or shall provide to all covered employees of employers
21subject to this section a new or amended evidence of coverage that
22includes the disclosures required by this section. Any specialized
23health care service plan that, in the ordinary course of business,
24maintains only the addresses of employer group purchasers of
25benefits and does not maintain addresses of covered employees,
26may comply with the notice requirements of this section through
27the provision of the notices to its employer group purchasers of
28benefits.

29(e) Every plan disclosure form issued, amended, or renewed on
30or after January 1, 1999, for a group benefit plan subject to this
31article shall provide a notice that, under state law, an enrollee may
32be entitled to continuation of group coverage and that additional
33information regarding eligibility for this coverage may be found
34in the plan’s evidence of coverage.

35(f) Every disclosure issued, amended, or renewed on or after
36the operative date of this section for a group benefit plan subject
37to this article shall include the following notice:

38

39“Please examine your options carefully before declining this
40coverage. You should be aware that companies selling individual
P21   1health insurance typically require a review of your medical history
2that could result in a higher premium or you could be denied
3coverage entirely.”
4

5(g) A disclosure issued, amended, or renewed on or after July
61, 2016, for a group benefit plan subject to this article shall include
7the following notice:

8

9“In addition to your coverage continuation options, you may be
10eligible for the following:

111. Coverage through the state health insurance marketplace, also
12known as Covered California. By enrolling through Covered
13California, you may qualify for lower monthly premiums and lower
14out-of-pocket costs. Your family members may also qualify for
15coverage through Covered California.

162. Coverage through Medi-Cal. Depending on your income, you
17may qualify for low or no-cost coverage through Medi-Cal. Your
18family members may also qualify for Medi-Cal.

193. Coverage through an insured spouse. If your spouse has
20coverage that extends to family members, you may be able to be
21added on that benefit plan.

22Be aware that there is a deadline to enroll in Covered California,
23although you can apply for Medi-Cal anytime. To find out more
24about how to apply for Covered California and Medi-Cal, visit the
25Covered California Internet Web site at
26 http://www.coveredca.com.”
27

28(h) (1) If Section 5000A of the Internal Revenue Code, as added
29by Section 1501 of PPACA, is repealed or amended to no longer
30apply to the individual market, as defined in Section 2791 of the
31federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
32section shall become operative 12 months after the date of that
33repeal or amendment.

34(2) For purposes of this subdivision, “PPACA” means the federal
35Patient Protection and Affordable Care Act (Public Law 111-148),
36as amended by the federal Health Care and Education
37Reconciliation Act of 2010 (Public Law 111-152), and any rules,
38regulations, or guidance issued pursuant to that law.

39

SEC. 4.  

Section 1366.25 of the Health and Safety Code is
40amended to read:

P22   1

1366.25.  

(a) Every group contract between a health care service
2plan and an employer subject to this article that is issued, amended,
3or renewed on or after July 1, 1998, shall require the employer to
4notify the plan, in writing, of any employee who has had a
5qualifying event, as defined in paragraph (2) of subdivision (d) of
6Section 1366.21, within 30 days of the qualifying event. The group
7contract shall also require the employer to notify the plan, in
8writing, within 30 days of the date, when the employer becomes
9subject to Section 4980B of the United States Internal Revenue
10Code or Chapter 18 of the Employee Retirement Income Security
11 Act (29 U.S.C. Sec. 1161 et seq.).

12(b) Every group contract between a plan and an employer subject
13to this article that is issued, amended, or renewed on or after July
141, 1998, shall require the employer to notify qualified beneficiaries
15currently receiving continuation coverage, whose continuation
16coverage will terminate under one group benefit plan prior to the
17end of the period the qualified beneficiary would have remained
18covered, as specified in Section 1366.27, of the qualified
19beneficiary’s ability to continue coverage under a new group
20benefit plan for the balance of the period the qualified beneficiary
21would have remained covered under the prior group benefit plan.
22This notice shall be provided either 30 days prior to the termination
23or when all enrolled employees are notified, whichever is later.

24Every health care service plan and specialized health care service
25plan shall provide to the employer replacing a health care service
26plan contract issued by the plan, or to the employer’s agent or
27broker representative, within 15 days of any written request,
28information in possession of the plan reasonably required to
29administer the notification requirements of this subdivision and
30subdivision (c).

31(c) Notwithstanding subdivision (a), the group contract between
32the health care service plan and the employer shall require the
33employer to notify the successor plan in writing of the qualified
34beneficiaries currently receiving continuation coverage so that the
35successor plan, or contracting employer or administrator, may
36provide those qualified beneficiaries with the necessary premium
37information, enrollment forms, and instructions consistent with
38the disclosure required by subdivision (c) of Section 1366.24 and
39subdivision (e) of this section to allow the qualified beneficiary to
40continue coverage. This information shall be sent to all qualified
P23   1beneficiaries who are enrolled in the plan and those qualified
2beneficiaries who have been notified, pursuant to Section 1366.24,
3of their ability to continue their coverage and may still elect
4coverage within the specified 60-day period. This information
5shall be sent to the qualified beneficiary’s last known address, as
6provided to the employer by the health care service plan or
7disability insurer currently providing continuation coverage to the
8qualified beneficiary. The successor plan shall not be obligated to
9provide this information to qualified beneficiaries if the employer
10or prior plan or insurer fails to comply with this section.

11(d) A health care service plan may contract with an employer,
12or an administrator, to perform the administrative obligations of
13the plan as required by this article, including required notifications
14and collecting and forwarding premiums to the health care service
15 plan. Except for the requirements of subdivisions (a), (b), and (c),
16this subdivision shall not be construed to permit a plan to require
17an employer to perform the administrative obligations of the plan
18as required by this article as a condition of the issuance or renewal
19of coverage.

20(e) Every health care service plan, or employer or administrator
21that contracts to perform the notice and administrative services
22pursuant to this section, shall, within 14 days of receiving a notice
23of a qualifying event, provide to the qualified beneficiary the
24necessary benefits information, premium information, enrollment
25forms, and disclosures consistent with the notice requirements
26contained in subdivisions (b) and (c) of Section 1366.24 to allow
27the qualified beneficiary to formally elect continuation coverage.
28This information shall be sent to the qualified beneficiary’s last
29known address.

30(f) Every health care service plan, or employer or administrator
31that contracts to perform the notice and administrative services
32pursuant to this section, shall, during the 180-day period ending
33on the date that continuation coverage is terminated pursuant to
34paragraphs (1), (3), and (5) of subdivision (a) of Section 1366.27,
35notify a qualified beneficiary who has elected continuation
36coverage pursuant to this article of the date that his or her coverage
37will terminate, and shall notify the qualified beneficiary of any
38conversion coverage available to that qualified beneficiary. This
39requirement shall not apply when the continuation coverage is
P24   1terminated because the group contract between the plan and the
2employer is being terminated.

3(g) (1) A health care service plan shall provide to a qualified
4beneficiary who has a qualifying event during the period specified
5in subparagraph (A) of paragraph (3) of subdivision (a) of Section
63001 of ARRA, a written notice containing information on the
7availability of premium assistance under ARRA. This notice shall
8be sent to the qualified beneficiary’s last known address. The notice
9shall include clear and easily understandable language to inform
10the qualified beneficiary that changes in federal law provide a new
11opportunity to elect continuation coverage with a 65-percent
12premium subsidy and shall include all of the following:

13(A) The amount of the premium the person will pay. For
14qualified beneficiaries who had a qualifying event between
15September 1, 2008, and May 12, 2009, inclusive, if a health care
16service plan is unable to provide the correct premium amount in
17the notice, the notice may contain the last known premium amount
18and an opportunity for the qualified beneficiary to request, through
19a toll-free telephone number, the correct premium that would apply
20to the beneficiary.

21(B) Enrollment forms and any other information required to be
22included pursuant to subdivision (e) to allow the qualified
23beneficiary to elect continuation coverage. This information shall
24not be included in notices sent to qualified beneficiaries currently
25enrolled in continuation coverage.

26(C) A description of the option to enroll in different coverage
27as provided in subparagraph (B) of paragraph (1) of subdivision
28(a) of Section 3001 of ARRA. This description shall advise the
29qualified beneficiary to contact the covered employee’s former
30employer for prior approval to choose this option.

31(D) The eligibility requirements for premium assistance in the
32amount of 65 percent of the premium under Section 3001 of
33ARRA.

34(E) The duration of premium assistance available under ARRA.

35(F) A statement that a qualified beneficiary eligible for premium
36assistance under ARRA may elect continuation coverage no later
37than 60 days of the date of the notice.

38(G) A statement that a qualified beneficiary eligible for premium
39assistance under ARRA who rejected or discontinued continuation
40coverage prior to receiving the notice required by this subdivision
P25   1has the right to withdraw that rejection and elect continuation
2coverage with the premium assistance.

3(H) A statement that reads as follows:


5“IF YOU ARE HAVING ANY DIFFICULTIES READING OR
6UNDERSTANDING THIS NOTICE, PLEASE CONTACT [name
7of health plan] at [insert appropriate telephone number].”
8


9(2) With respect to qualified beneficiaries who had a qualifying
10event between September 1, 2008, and May 12, 2009, inclusive,
11the notice described in this subdivision shall be provided by the
12later of May 26, 2009, or seven business days after the date the
13plan receives notice of the qualifying event.

14(3) With respect to qualified beneficiaries who had or have a
15qualifying event between May 13, 2009, and the later date specified
16in subparagraph (A) of paragraph (3) of subdivision (a) of Section
173001 of ARRA, inclusive, the notice described in this subdivision
18shall be provided within the period of time specified in subdivision
19(e).

20(4) Nothing in this section shall be construed to require a health
21care service plan to provide the plan’s evidence of coverage as a
22part of the notice required by this subdivision, and nothing in this
23section shall be construed to require a health care service plan to
24amend its existing evidence of coverage to comply with the changes
25made to this section by the enactment of Assembly Bill 23 of the
262009-10 Regular Session or by the act amending this section during
27the second year of the 2009-10 Regular Session.

28(5) The requirement under this subdivision to provide a written
29notice to a qualified beneficiary and the requirement under
30paragraph (1) of subdivision (i) to provide a new opportunity to a
31qualified beneficiary to elect continuation coverage shall be deemed
32satisfied if a health care service plan previously provided a written
33notice and additional election opportunity under Section 3001 of
34ARRA to that qualified beneficiary prior to the effective date of
35the act adding this paragraph.

36(h) A group contract between a group benefit plan and an
37employer subject to this article that is issued, amended, or renewed
38on or after July 1, 2016, shall require the employer to give the
39following notice to a qualified beneficiary in connection with a
40notice regarding election of continuation coverage:

P26   1

2“In addition to your coverage continuation options, you may be
3eligible for the following:

41. Coverage through the state health insurance marketplace, also
5known as Covered California. By enrolling through Covered
6California, you may qualify for lower monthly premiums and lower
7out-of-pocket costs. Your family members may also qualify for
8coverage through Covered California.

92. Coverage through Medi-Cal. Depending on your income, you
10may qualify for low or no-cost coverage through Medi-Cal. Your
11family members may also qualify for Medi-Cal.

123. Coverage through an insured spouse. If your spouse has
13coverage that extends to family members, you may be able to be
14added on that benefit plan.

15Be aware that there is a deadline to enroll in Covered California,
16although you can apply for Medi-Cal anytime. To find out more
17about how to apply for Covered California and Medi-Cal, visit the
18Covered California Internet Web site at
19 http://www.coveredca.com.”
20

21(i) (1) Notwithstanding any other law, a qualified beneficiary
22eligible for premium assistance under ARRA may elect
23continuation coverage no later than 60 days after the date of the
24notice required by subdivision (g).

25(2) For a qualified beneficiary who elects to continue coverage
26pursuant to this subdivision, the period beginning on the date of
27the qualifying event and ending on the effective date of the
28continuation coverage shall be disregarded for purposes of
29calculating a break in coverage in determining whether a
30preexisting condition provision applies under subdivision (c) of
31Section 1357.06 or subdivision (e) of Section 1357.51.

32(3) For a qualified beneficiary who had a qualifying event
33between September 1, 2008, and February 16, 2009, inclusive, and
34who elects continuation coverage pursuant to paragraph (1), the
35continuation coverage shall commence on the first day of the month
36following the election.

37(4) For a qualified beneficiary who had a qualifying event
38between February 17, 2009, and May 12, 2009, inclusive, and who
39elects continuation coverage pursuant to paragraph (1), the effective
40date of the continuation coverage shall be either of the following,
P27   1at the option of the beneficiary, provided that the beneficiary pays
2the applicable premiums:

3(A) The date of the qualifying event.

4(B) The first day of the month following the election.

5(5) Notwithstanding any other law, a qualified beneficiary who
6is eligible for the special election opportunity described in
7paragraph (17) of subdivision (a) of Section 3001 of ARRA may
8elect continuation coverage no later than 60 days after the date of
9the notice required under subdivision (k). For a qualified
10beneficiary who elects coverage pursuant to this paragraph, the
11continuation coverage shall be effective as of the first day of the
12first period of coverage after the date of termination of
13employment, except, if federal law permits, coverage shall take
14effect on the first day of the month following the election.
15However, for purposes of calculating the duration of continuation
16coverage pursuant to Section 1366.27, the period of that coverage
17shall be determined as though the qualifying event was a reduction
18of hours of the employee.

19(6) Notwithstanding any other law, a qualified beneficiary who
20is eligible for any other special election opportunity under ARRA
21may elect continuation coverage no later than 60 days after the
22date of the special election notice required under ARRA.

23(j) A health care service plan shall provide a qualified
24beneficiary eligible for premium assistance under ARRA written
25notice of the extension of that premium assistance as required
26under Section 3001 of ARRA.

27(k) A health care service plan, or an administrator or employer
28if administrative obligations have been assumed by those entities
29pursuant to subdivision (d), shall give the qualified beneficiaries
30described in subparagraph (C) of paragraph (17) of subdivision
31(a) of Section 3001 of ARRA the written notice required by that
32paragraph by implementing the following procedures:

33(1) The health care service plan shall, within 14 days of the
34effective date of the act adding this subdivision, send a notice to
35employers currently contracting with the health care service plan
36for a group benefit plan subject to this article. The notice shall do
37all of the following:

38(A) Advise the employer that employees whose employment is
39terminated on or after March 2, 2010, who were previously enrolled
40in any group health care service plan or health insurance policy
P28   1offered by the employer may be entitled to special health coverage
2rights, including a subsidy paid by the federal government for a
3portion of the premium.

4(B) Ask the employer to provide the health care service plan
5with the name, address, and date of termination of employment
6for any employee whose employment is terminated on or after
7March 2, 2010, and who was at any time covered by any health
8care service plan or health insurance policy offered to their
9employees on or after September 1, 2008.

10(C) Provide employers with a format and instructions for
11submitting the information to the health care service plan, or their
12administrator or employer who has assumed administrative
13obligations pursuant to subdivision (d), by telephone, fax,
14electronic mail, or mail.

15(2) Within 14 days of receipt of the information specified in
16paragraph (1) from the employer, the health care service plan shall
17send the written notice specified in paragraph (17) of subdivision
18(a) of Section 3001 of ARRA to those individuals.

19(3) If an individual contacts his or her health care service plan
20and indicates that he or she experienced a qualifying event that
21entitles him or her to the special election period described in
22paragraph (17) of subdivision (a) of Section 3001 of ARRA or any
23other special election provision of ARRA, the plan shall provide
24the individual with the written notice required under paragraph
25(17) of subdivision (a) of Section 3001 of ARRA or any other
26applicable provision of ARRA, regardless of whether the plan
27receives information from the individual’s previous employer
28regarding that individual pursuant to Section 24100. The plan shall
29review the individual’s application for coverage under this special
30election notice to determine if the individual qualifies for the
31special election period and the premium assistance under ARRA.
32The plan shall comply with paragraph (5) if the individual does
33not qualify for either the special election period or premium
34assistance under ARRA.

35(4) The requirement under this subdivision to provide the written
36notice described in paragraph (17) of subdivision (a) of Section
373001 of ARRA to a qualified beneficiary and the requirement
38under paragraph (5) of subdivision (i) to provide a new opportunity
39to a qualified beneficiary to elect continuation coverage shall be
40deemed satisfied if a health care service plan previously provided
P29   1the written notice and additional election opportunity described in
2paragraph (17) of subdivision (a) of Section 3001 of ARRA to that
3qualified beneficiary prior to the effective date of the act adding
4this paragraph.

5(5) If an individual does not qualify for either a special election
6period or the premium assistance under ARRA, the health care
7service plan shall provide a written notice to that individual that
8shall include information on the right to appeal as set forth in
9Section 3001 of ARRA.

10(6) A health care service plan shall provide information on its
11publicly accessible Internet Web site regarding the premium
12assistance made available under ARRA and any special election
13period provided under that law. A plan may fulfill this requirement
14by linking or otherwise directing consumers to the information
15regarding COBRA continuation coverage premium assistance
16located on the Internet Web site of the United States Department
17of Labor. The information required by this paragraph shall be
18located in a section of the plan’s Internet Web site that is readily
19accessible to consumers, such as the Web site’s Frequently Asked
20Questions section.

21(l) For purposes of implementing federal premium assistance
22for continuation coverage, the department may designate a model
23notice or notices that may be used by health care service plans.
24Use of the model notice or notices shall not require prior approval
25of the department. Any model notice or notices designated by the
26department for purposes of this subdivision shall not be subject to
27the Administrative Procedure Act (Chapter 3.5 (commencing with
28Section 11340) of Part 1 of Division 3 of Title 2 of the Government
29Code).

30(m) Notwithstanding any other law, a qualified beneficiary
31eligible for premium assistance under ARRA may elect to enroll
32in different coverage subject to the criteria provided under
33subparagraph (B) of paragraph (1) of subdivision (a) of Section
343001 of ARRA.

35(n) A qualified beneficiary enrolled in continuation coverage
36as of February 17, 2009, who is eligible for premium assistance
37under ARRA may request application of the premium assistance
38as of March 1, 2009, or later, consistent with ARRA.

39(o) A health care service plan that receives an election notice
40from a qualified beneficiary eligible for premium assistance under
P30   1ARRA, pursuant to subdivision (i), shall be considered a person
2entitled to reimbursement, as defined in Section 6432(b)(3) of the
3Internal Revenue Code, as amended by paragraph (12) of
4subdivision (a) of Section 3001 of ARRA.

5(p) (1) For purposes of compliance with ARRA, in the absence
6of guidance from, or if specifically required for state-only
7continuation coverage by, the United States Department of Labor,
8the Internal Revenue Service, or the Centers for Medicare and
9Medicaid Services, a health care service plan may request
10verification of the involuntary termination of a covered employee’s
11employment from the covered employee’s former employer or the
12qualified beneficiary seeking premium assistance under ARRA.

13(2) A health care service plan that requests verification pursuant
14to paragraph (1) directly from a covered employee’s former
15employer shall do so by providing a written notice to the employer.
16This written notice shall be sent by mail or facsimile to the covered
17employee’s former employer within seven business days from the
18date the plan receives the qualified beneficiary’s election notice
19pursuant to subdivision (i). Within 10 calendar days of receipt of
20written notice required by this paragraph, the former employer
21shall furnish to the health care service plan written verification as
22to whether the covered employee’s employment was involuntarily
23terminated.

24(3) A qualified beneficiary requesting premium assistance under
25ARRA may furnish to the health care service plan a written
26document or other information from the covered employee’s former
27employer indicating that the covered employee’s employment was
28involuntarily terminated. This document or information shall be
29deemed sufficient by the health care service plan to establish that
30the covered employee’s employment was involuntarily terminated
31for purposes of ARRA, unless the plan makes a reasonable and
32timely determination that the documents or information provided
33by the qualified beneficiary are legally insufficient to establish
34involuntary termination of employment.

35(4) If a health care service plan requests verification pursuant
36to this subdivision and cannot verify involuntary termination of
37employment within 14 business days from the date the employer
38receives the verification request or from the date the plan receives
39documentation or other information from the qualified beneficiary
40pursuant to paragraph (3), the health care service plan shall either
P31   1provide continuation coverage with the federal premium assistance
2to the qualified beneficiary or send the qualified beneficiary a
3denial letter which shall include notice of his or her right to appeal
4that determination pursuant to ARRA.

5(5) No person shall intentionally delay verification of
6involuntary termination of employment under this subdivision.

7(q) The provision of information and forms related to the
8premium assistance available pursuant to ARRA to individuals by
9a health care service plan shall not be considered a violation of
10this chapter provided that the plan complies with all of the
11requirements of this article.

12(r) (1) If Section 5000A of the Internal Revenue Code, as added
13by Section 1501 of PPACA, is repealed or amended to no longer
14apply to the individual market, as defined in Section 2791 of the
15federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
16section shall become inoperative and is repealed 12 months after
17the date of that repeal or amendment.

18(2) For purposes of this subdivision, “PPACA” means the federal
19Patient Protection and Affordable Care Act (Public Law 111-148),
20as amended by the federal Health Care and Education
21Reconciliation Act of 2010 (Public Law 111-152), and any rules,
22regulations, or guidance issued pursuant to that law.

23

SEC. 5.  

Section 1366.25 is added to the Health and Safety
24Code
, to read:

25

1366.25.  

(a) Every group contract between a health care service
26plan and an employer subject to this article that is issued, amended,
27or renewed on or after July 1, 1998, shall require the employer to
28notify the plan, in writing, of any employee who has had a
29qualifying event, as defined in paragraph (2) of subdivision (d) of
30Section 1366.21, within 30 days of the qualifying event. The group
31contract shall also require the employer to notify the plan, in
32writing, within 30 days of the date, when the employer becomes
33subject to Section 4980B of the United States Internal Revenue
34Code or Chapter 18 of the Employee Retirement Income Security
35Act (29 U.S.C. Sec. 1161 et seq.).

36(b) Every group contract between a plan and an employer subject
37to this article that is issued, amended, or renewed on or after July
381, 1998, shall require the employer to notify qualified beneficiaries
39currently receiving continuation coverage, whose continuation
40coverage will terminate under one group benefit plan prior to the
P32   1end of the period the qualified beneficiary would have remained
2covered, as specified in Section 1366.27, of the qualified
3beneficiary’s ability to continue coverage under a new group
4benefit plan for the balance of the period the qualified beneficiary
5would have remained covered under the prior group benefit plan.
6This notice shall be provided either 30 days prior to the termination
7or when all enrolled employees are notified, whichever is later.

8Every health care service plan and specialized health care service
9plan shall provide to the employer replacing a health care service
10plan contract issued by the plan, or to the employer’s agent or
11broker representative, within 15 days of any written request,
12information in possession of the plan reasonably required to
13administer the notification requirements of this subdivision and
14subdivision (c).

15(c) Notwithstanding subdivision (a), the group contract between
16the health care service plan and the employer shall require the
17employer to notify the successor plan in writing of the qualified
18beneficiaries currently receiving continuation coverage so that the
19successor plan, or contracting employer or administrator, may
20provide those qualified beneficiaries with the necessary premium
21information, enrollment forms, and instructions consistent with
22the disclosure required by subdivision (c) of Section 1366.24 and
23subdivision (e) of this section to allow the qualified beneficiary to
24continue coverage. This information shall be sent to all qualified
25beneficiaries who are enrolled in the plan and those qualified
26beneficiaries who have been notified, pursuant to Section 1366.24,
27of their ability to continue their coverage and may still elect
28coverage within the specified 60-day period. This information
29shall be sent to the qualified beneficiary’s last known address, as
30provided to the employer by the health care service plan or
31disability insurer currently providing continuation coverage to the
32qualified beneficiary. The successor plan shall not be obligated to
33provide this information to qualified beneficiaries if the employer
34or prior plan or insurer fails to comply with this section.

35(d) A health care service plan may contract with an employer,
36or an administrator, to perform the administrative obligations of
37the plan as required by this article, including required notifications
38and collecting and forwarding premiums to the health care service
39plan. Except for the requirements of subdivisions (a), (b), and (c),
40this subdivision shall not be construed to permit a plan to require
P33   1an employer to perform the administrative obligations of the plan
2as required by this article as a condition of the issuance or renewal
3of coverage.

4(e) Every health care service plan, or employer or administrator
5that contracts to perform the notice and administrative services
6pursuant to this section, shall, within 14 days of receiving a notice
7of a qualifying event, provide to the qualified beneficiary the
8necessary benefits information, premium information, enrollment
9forms, and disclosures consistent with the notice requirements
10contained in subdivisions (b) and (c) of Section 1366.24 to allow
11the qualified beneficiary to formally elect continuation coverage.
12This information shall be sent to the qualified beneficiary’s last
13known address.

14(f) Every health care service plan, or employer or administrator
15that contracts to perform the notice and administrative services
16pursuant to this section, shall, during the 180-day period ending
17on the date that continuation coverage is terminated pursuant to
18paragraphs (1), (3), and (5) of subdivision (a) of Section 1366.27,
19notify a qualified beneficiary who has elected continuation
20coverage pursuant to this article of the date that his or her coverage
21will terminate, and shall notify the qualified beneficiary of any
22conversion coverage available to that qualified beneficiary. This
23requirement shall not apply when the continuation coverage is
24terminated because the group contract between the plan and the
25employer is being terminated.

26(g) (1) A health care service plan shall provide to a qualified
27beneficiary who has a qualifying event during the period specified
28in subparagraph (A) of paragraph (3) of subdivision (a) of Section
293001 of ARRA, a written notice containing information on the
30availability of premium assistance under ARRA. This notice shall
31be sent to the qualified beneficiary’s last known address. The notice
32shall include clear and easily understandable language to inform
33the qualified beneficiary that changes in federal law provide a new
34opportunity to elect continuation coverage with a 65-percent
35premium subsidy and shall include all of the following:

36(A) The amount of the premium the person will pay. For
37qualified beneficiaries who had a qualifying event between
38September 1, 2008, and May 12, 2009, inclusive, if a health care
39service plan is unable to provide the correct premium amount in
40the notice, the notice may contain the last known premium amount
P34   1and an opportunity for the qualified beneficiary to request, through
2a toll-free telephone number, the correct premium that would apply
3to the beneficiary.

4(B) Enrollment forms and any other information required to be
5included pursuant to subdivision (e) to allow the qualified
6beneficiary to elect continuation coverage. This information shall
7not be included in notices sent to qualified beneficiaries currently
8enrolled in continuation coverage.

9(C) A description of the option to enroll in different coverage
10as provided in subparagraph (B) of paragraph (1) of subdivision
11(a) of Section 3001 of ARRA. This description shall advise the
12qualified beneficiary to contact the covered employee’s former
13employer for prior approval to choose this option.

14(D) The eligibility requirements for premium assistance in the
15amount of 65 percent of the premium under Section 3001 of
16ARRA.

17(E) The duration of premium assistance available under ARRA.

18(F) A statement that a qualified beneficiary eligible for premium
19assistance under ARRA may elect continuation coverage no later
20than 60 days of the date of the notice.

21(G) A statement that a qualified beneficiary eligible for premium
22assistance under ARRA who rejected or discontinued continuation
23coverage prior to receiving the notice required by this subdivision
24has the right to withdraw that rejection and elect continuation
25coverage with the premium assistance.

26(H) A statement that reads as follows:


28“IF YOU ARE HAVING ANY DIFFICULTIES READING OR
29UNDERSTANDING THIS NOTICE, PLEASE CONTACT [name
30of health plan] at [insert appropriate telephone number].”
31


32(2) With respect to qualified beneficiaries who had a qualifying
33event between September 1, 2008, and May 12, 2009, inclusive,
34the notice described in this subdivision shall be provided by the
35later of May 26, 2009, or seven business days after the date the
36plan receives notice of the qualifying event.

37(3) With respect to qualified beneficiaries who had or have a
38qualifying event between May 13, 2009, and the later date specified
39in subparagraph (A) of paragraph (3) of subdivision (a) of Section
403001 of ARRA, inclusive, the notice described in this subdivision
P35   1shall be provided within the period of time specified in subdivision
2(e).

3(4) Nothing in this section shall be construed to require a health
4care service plan to provide the plan’s evidence of coverage as a
5part of the notice required by this subdivision, and nothing in this
6section shall be construed to require a health care service plan to
7amend its existing evidence of coverage to comply with the changes
8made to this section by the enactment of Assembly Bill 23 of the
92009-10 Regular Session or by the act amending this section during
10the second year of the 2009-10 Regular Session.

11(5) The requirement under this subdivision to provide a written
12notice to a qualified beneficiary and the requirement under
13paragraph (1) of subdivision (k) to provide a new opportunity to
14a qualified beneficiary to elect continuation coverage shall be
15deemed satisfied if a health care service plan previously provided
16a written notice and additional election opportunity under Section
173001 of ARRA to that qualified beneficiary prior to the effective
18date of the act adding this paragraph.

19(h) A group contract between a group benefit plan and an
20employer subject to this article that is issued, amended, or renewed
21on or after the operative date of this section shall require the
22employer to give the following notice to a qualified beneficiary in
23connection with a notice regarding election of continuation
24coverage:

25

26“Please examine your options carefully before declining this
27coverage. You should be aware that companies selling individual
28health insurance typically require a review of your medical history
29that could result in a higher premium or you could be denied
30coverage entirely.”
31

32(i) A group contract between a group benefit plan and an
33employer subject to this article that is issued, amended, or renewed
34on or after July 1, 2016, shall require the employer to give the
35following notice to a qualified beneficiary in connection with a
36notice regarding election of continuation coverage:

37

38“In addition to your coverage continuation options, you may be
39eligible for the following:

P36   11. Coverage through the state health insurance marketplace, also
2known as Covered California. By enrolling through Covered
3California, you may qualify for lower monthly premiums and lower
4out-of-pocket costs. Your family members may also qualify for
5coverage through Covered California.

62. Coverage through Medi-Cal. Depending on your income, you
7may qualify for low or no-cost coverage through Medi-Cal. Your
8family members may also qualify for Medi-Cal.

93. Coverage through an insured spouse. If your spouse has
10coverage that extends to family members, you may be able to be
11added on that benefit plan.

12Be aware that there is a deadline to enroll in Covered California,
13although you can apply for Medi-Cal anytime. To find out more
14about how to apply for Covered California and Medi-Cal, visit the
15Covered California Internet Web site at
16 http://www.coveredca.com.”
17

18(j) (1) Notwithstanding any other law, a qualified beneficiary
19eligible for premium assistance under ARRA may elect
20continuation coverage no later than 60 days after the date of the
21notice required by subdivision (g).

22(2) For a qualified beneficiary who elects to continue coverage
23pursuant to this subdivision, the period beginning on the date of
24the qualifying event and ending on the effective date of the
25continuation coverage shall be disregarded for purposes of
26calculating a break in coverage in determining whether a
27preexisting condition provision applies under subdivision (c) of
28Section 1357.06 or subdivision (e) of Section 1357.51.

29(3) For a qualified beneficiary who had a qualifying event
30between September 1, 2008, and February 16, 2009, inclusive, and
31who elects continuation coverage pursuant to paragraph (1), the
32continuation coverage shall commence on the first day of the month
33following the election.

34(4) For a qualified beneficiary who had a qualifying event
35between February 17, 2009, and May 12, 2009, inclusive, and who
36elects continuation coverage pursuant to paragraph (1), the effective
37date of the continuation coverage shall be either of the following,
38at the option of the beneficiary, provided that the beneficiary pays
39the applicable premiums:

40(A) The date of the qualifying event.

P37   1(B) The first day of the month following the election.

2(5) Notwithstanding any other law, a qualified beneficiary who
3is eligible for the special election opportunity described in
4paragraph (17) of subdivision (a) of Section 3001 of ARRA may
5elect continuation coverage no later than 60 days after the date of
6the notice required under subdivision (l). For a qualified beneficiary
7who elects coverage pursuant to this paragraph, the continuation
8coverage shall be effective as of the first day of the first period of
9coverage after the date of termination of employment, except, if
10federal law permits, coverage shall take effect on the first day of
11the month following the election. However, for purposes of
12calculating the duration of continuation coverage pursuant to
13Section 1366.27, the period of that coverage shall be determined
14as though the qualifying event was a reduction of hours of the
15employee.

16(6) Notwithstanding any other law, a qualified beneficiary who
17is eligible for any other special election opportunity under ARRA
18may elect continuation coverage no later than 60 days after the
19date of the special election notice required under ARRA.

20(k) A health care service plan shall provide a qualified
21beneficiary eligible for premium assistance under ARRA written
22notice of the extension of that premium assistance as required
23under Section 3001 of ARRA.

24(l) A health care service plan, or an administrator or employer
25if administrative obligations have been assumed by those entities
26pursuant to subdivision (d), shall give the qualified beneficiaries
27described in subparagraph (C) of paragraph (17) of subdivision
28(a) of Section 3001 of ARRA the written notice required by that
29paragraph by implementing the following procedures:

30(1) The health care service plan shall, within 14 days of the
31effective date of the act adding this subdivision, send a notice to
32employers currently contracting with the health care service plan
33 for a group benefit plan subject to this article. The notice shall do
34all of the following:

35(A) Advise the employer that employees whose employment is
36terminated on or after March 2, 2010, who were previously enrolled
37in any group health care service plan or health insurance policy
38offered by the employer may be entitled to special health coverage
39rights, including a subsidy paid by the federal government for a
40portion of the premium.

P38   1(B) Ask the employer to provide the health care service plan
2with the name, address, and date of termination of employment
3for any employee whose employment is terminated on or after
4March 2, 2010, and who was at any time covered by any health
5care service plan or health insurance policy offered to their
6employees on or after September 1, 2008.

7(C) Provide employers with a format and instructions for
8submitting the information to the health care service plan, or their
9administrator or employer who has assumed administrative
10obligations pursuant to subdivision (d), by telephone, fax,
11electronic mail, or mail.

12(2) Within 14 days of receipt of the information specified in
13paragraph (1) from the employer, the health care service plan shall
14send the written notice specified in paragraph (17) of subdivision
15(a) of Section 3001 of ARRA to those individuals.

16(3) If an individual contacts his or her health care service plan
17and indicates that he or she experienced a qualifying event that
18entitles him or her to the special election period described in
19paragraph (17) of subdivision (a) of Section 3001 of ARRA or any
20other special election provision of ARRA, the plan shall provide
21the individual with the written notice required under paragraph
22(17) of subdivision (a) of Section 3001 of ARRA or any other
23applicable provision of ARRA, regardless of whether the plan
24receives information from the individual’s previous employer
25regarding that individual pursuant to Section 24100. The plan shall
26review the individual’s application for coverage under this special
27election notice to determine if the individual qualifies for the
28special election period and the premium assistance under ARRA.
29The plan shall comply with paragraph (5) if the individual does
30not qualify for either the special election period or premium
31assistance under ARRA.

32(4) The requirement under this subdivision to provide the written
33notice described in paragraph (17) of subdivision (a) of Section
343001 of ARRA to a qualified beneficiary and the requirement
35under paragraph (5) of subdivision (j) to provide a new opportunity
36to a qualified beneficiary to elect continuation coverage shall be
37deemed satisfied if a health care service plan previously provided
38the written notice and additional election opportunity described in
39paragraph (17) of subdivision (a) of Section 3001 of ARRA to that
P39   1qualified beneficiary prior to the effective date of the act adding
2this paragraph.

3(5) If an individual does not qualify for either a special election
4period or the premium assistance under ARRA, the health care
5service plan shall provide a written notice to that individual that
6shall include information on the right to appeal as set forth in
7Section 3001 of ARRA.

8(6) A health care service plan shall provide information on its
9publicly accessible Internet Web site regarding the premium
10assistance made available under ARRA and any special election
11period provided under that law. A plan may fulfill this requirement
12by linking or otherwise directing consumers to the information
13regarding COBRA continuation coverage premium assistance
14located on the Internet Web site of the United States Department
15of Labor. The information required by this paragraph shall be
16located in a section of the plan’s Internet Web site that is readily
17accessible to consumers, such as the Web site’s Frequently Asked
18Questions section.

19(m) For purposes of implementing federal premium assistance
20for continuation coverage, the department may designate a model
21notice or notices that may be used by health care service plans.
22Use of the model notice or notices shall not require prior approval
23of the department. Any model notice or notices designated by the
24department for purposes of this subdivision shall not be subject to
25the Administrative Procedure Act (Chapter 3.5 (commencing with
26Section 11340) of Part 1 of Division 3 of Title 2 of the Government
27Code).

28(n) Notwithstanding any other law, a qualified beneficiary
29eligible for premium assistance under ARRA may elect to enroll
30in different coverage subject to the criteria provided under
31subparagraph (B) of paragraph (1) of subdivision (a) of Section
323001 of ARRA.

33(o) A qualified beneficiary enrolled in continuation coverage
34as of February 17, 2009, who is eligible for premium assistance
35under ARRA may request application of the premium assistance
36as of March 1, 2009, or later, consistent with ARRA.

37(p) A health care service plan that receives an election notice
38from a qualified beneficiary eligible for premium assistance under
39ARRA, pursuant to subdivision (j), shall be considered a person
40entitled to reimbursement, as defined in Section 6432(b)(3) of the
P40   1Internal Revenue Code, as amended by paragraph (12) of
2subdivision (a) of Section 3001 of ARRA.

3(q) (1) For purposes of compliance with ARRA, in the absence
4of guidance from, or if specifically required for state-only
5continuation coverage by, the United States Department of Labor,
6the Internal Revenue Service, or the Centers for Medicare and
7Medicaid Services, a health care service plan may request
8verification of the involuntary termination of a covered employee’s
9employment from the covered employee’s former employer or the
10qualified beneficiary seeking premium assistance under ARRA.

11(2) A health care service plan that requests verification pursuant
12to paragraph (1) directly from a covered employee’s former
13employer shall do so by providing a written notice to the employer.
14This written notice shall be sent by mail or facsimile to the covered
15employee’s former employer within seven business days from the
16date the plan receives the qualified beneficiary’s election notice
17pursuant to subdivision (j). Within 10 calendar days of receipt of
18written notice required by this paragraph, the former employer
19shall furnish to the health care service plan written verification as
20to whether the covered employee’s employment was involuntarily
21terminated.

22(3) A qualified beneficiary requesting premium assistance under
23ARRA may furnish to the health care service plan a written
24document or other information from the covered employee’s former
25employer indicating that the covered employee’s employment was
26involuntarily terminated. This document or information shall be
27deemed sufficient by the health care service plan to establish that
28the covered employee’s employment was involuntarily terminated
29for purposes of ARRA, unless the plan makes a reasonable and
30timely determination that the documents or information provided
31by the qualified beneficiary are legally insufficient to establish
32involuntary termination of employment.

33(4) If a health care service plan requests verification pursuant
34to this subdivision and cannot verify involuntary termination of
35employment within 14 business days from the date the employer
36receives the verification request or from the date the plan receives
37documentation or other information from the qualified beneficiary
38pursuant to paragraph (3), the health care service plan shall either
39provide continuation coverage with the federal premium assistance
40to the qualified beneficiary or send the qualified beneficiary a
P41   1denial letter which shall include notice of his or her right to appeal
2that determination pursuant to ARRA.

3(5) No person shall intentionally delay verification of
4involuntary termination of employment under this subdivision.

5(r) The provision of information and forms related to the
6premium assistance available pursuant to ARRA to individuals by
7a health care service plan shall not be considered a violation of
8this chapter provided that the plan complies with all of the
9requirements of this article.

10(s) (1) If Section 5000A of the Internal Revenue Code, as added
11by Section 1501 of PPACA, is repealed or amended to no longer
12apply to the individual market, as defined in Section 2791 of the
13federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
14section shall become operative 12 months after the date of that
15repeal or amendment.

16(2) For purposes of this subdivision, “PPACA” means the federal
17Patient Protection and Affordable Care Act (Public Law 111-148),
18as amended by the federal Health Care and Education
19Reconciliation Act of 2010 (Public Law 111-152), and any rules,
20regulations, or guidance issued pursuant to that law.

21

SEC. 6.  

Section 24100 of the Health and Safety Code is
22amended to read:

23

24100.  

(a) For purposes of this section, the following
24definitions apply:

25(1) “ARRA” means Title III of Division B of the federal
26American Recovery and Reinvestment Act of 2009 or any
27amendment to that federal law extending federal premium
28assistance to qualified beneficiaries, as defined in Section 1366.21
29of this code or Section 10128.51 of the Insurance Code.

30(2) “Employer” means an employer as defined in Section
311366.21 of this code or an employer as defined in Section 10128.51
32of the Insurance Code.

33(b) An employer shall provide the information described in
34subparagraph (B) of paragraph (1) of subdivision (k) of Section
351366.25 of this code or subparagraph (B) of paragraph (1) of
36subdivision (k) of Section 10128.55 of the Insurance Code, as
37applicable, with respect to any employee whose employment is
38terminated on or after March 2, 2010, and who was enrolled at any
39time in a health care service plan or health insurance policy offered
40by the employer on or after September 1, 2008. This information
P42   1shall be provided to the requesting health care service plan or
2health insurer within 14 days of receipt of the notification described
3in paragraph (1) of subdivision (k) of Section 1366.25 of this code
4or paragraph (1) of subdivision (k) of Section 10128.55 of the
5Insurance Code. The employer shall continue to provide the
6information to the health care service plan or health insurer within
714 days after the end of each month for any employee whose
8employment is terminated in the prior month until the last date
9specified in subparagraph (A) of paragraph (3) of subdivision (a)
10of Section 3001 of ARRA.

11

SEC. 7.  

Section 10128.52 of the Insurance Code is amended
12to read:

13

10128.52.  

The continuation coverage requirements of this
14article do not apply to the following individuals:

15(a) Individuals who are entitled to Medicare benefits or become
16entitled to Medicare benefits pursuant to Title XVIII of the United
17States Social Security Act, as amended or superseded. Entitlement
18to Medicare Part A only constitutes entitlement to benefits under
19Medicare.

20(b) Individuals who have other hospital, medical, or surgical
21coverage, or who are covered or become covered under another
22group benefit plan, including a self-insured employee welfare
23benefit plan, that provides coverage for individuals and that does
24not impose any exclusion or limitation with respect to any
25preexisting condition of the individual, other than a preexisting
26condition limitation or exclusion that does not apply to or is
27satisfied by the qualified beneficiary pursuant to Sections 10198.6
28and 10198.7. A group conversion option under any group benefit
29plan shall not be considered as an arrangement under which an
30individual is or becomes covered.

31(c) Individuals who are covered, become covered, or are eligible
32for federal COBRA coverage pursuant to Section 4980B of the
33United States Internal Revenue Code or Chapter 18 of the
34Employee Retirement Income Security Act (29 U.S.C. Sec. 1161
35et seq.).

36(d) Individuals who are covered, become covered, or are eligible
37for coverage pursuant to Chapter 6A of the Public Health Service
38Act (42 U.S.C. Sec. 300bb-1 et seq.).

39(e) Qualified beneficiaries who fail to meet the requirements of
40subdivision (b) of Section 10128.54 or subdivision (i) of Section
P43   110128.55 regarding notification of a qualifying event or election
2of continuation coverage within the specified time limits.

3(f) Except as provided in Section 3001 of ARRA, qualified
4beneficiaries who fail to submit the correct premium amount
5required by subdivision (b) of Section 10128.55 and Section
610128.57, in accordance with the terms and conditions of the policy
7or contract, or fail to satisfy other terms and conditions of the
8policy or contract.

9

SEC. 8.  

Section 10128.54 of the Insurance Code is amended
10to read:

11

10128.54.  

(a) Every insurer’s evidence of coverage for group
12benefit plans subject to this article, that is issued, amended, or
13renewed on or after January 1, 1999, shall disclose to covered
14employees of group benefit plans subject to this article the ability
15to continue coverage pursuant to this article, as required by this
16section.

17(b) This disclosure shall state that all insureds who are eligible
18to be qualified beneficiaries, as defined in subdivision (c) of
19Section 10128.51, shall be required, as a condition of receiving
20benefits pursuant to this article, to notify, in writing, the insurer,
21or the employer if the employer contracts to perform the
22administrative services as provided for in Section 10128.55, of all
23qualifying events as specified in paragraphs (1), (3), (4), and (5)
24of subdivision (d) of Section 10128.51 within 60 days of the date
25of the qualifying event. This disclosure shall inform insureds that
26failure to make the notification to the insurer, or to the employer
27when under contract to provide the administrative services, within
28the required 60 days will disqualify the qualified beneficiary from
29receiving continuation coverage pursuant to this article. The
30disclosure shall further state that a qualified beneficiary who wishes
31to continue coverage under the group benefit plan pursuant to this
32article shall request the continuation in writing and deliver the
33written request, by first-class mail, or other reliable means of
34delivery, including personal delivery, express mail, or private
35courier company, to the disability insurer, or to the employer if
36the plan has contracted with the employer for administrative
37services pursuant to subdivision (d) of Section 10128.55, within
38the 60-day period following the later of (1) the date that the
39insured’s coverage under the group benefit plan terminated or will
40terminate by reason of a qualifying event, or (2) the date the insured
P44   1was sent notice pursuant to subdivision (e) of Section 10128.55
2of the ability to continue coverage under the group benefit plan.
3The disclosure required by this section shall also state that a
4qualified beneficiary electing continuation shall pay to the disability
5insurer, in accordance with the terms and conditions of the policy
6or contract, which shall be set forth in the notice to the qualified
7beneficiary pursuant to subdivision (d) of Section 10128.55, the
8amount of the required premium payment, as set forth in Section
910128.56. The disclosure shall further require that the qualified
10beneficiary’s first premium payment required to establish premium
11payment be delivered by first-class mail, certified mail, or other
12reliable means of delivery, including personal delivery, express
13mail, or private courier company, to the disability insurer, or to
14 the employer if the employer has contracted with the insurer to
15perform the administrative services pursuant to subdivision (d) of
16Section 10128.55, within 45 days of the date the qualified
17beneficiary provided written notice to the insurer or the employer,
18if the employer has contracted to perform the administrative
19services, of the election to continue coverage in order for coverage
20to be continued under this article. This disclosure shall also state
21that the first premium payment shall equal an amount sufficient
22to pay all required premiums and all premiums due, and that failure
23to submit the correct premium amount within the 45-day period
24will disqualify the qualified beneficiary from receiving continuation
25coverage pursuant to this article.

26(c) The disclosure required by this section shall also describe
27separately how qualified beneficiaries whose continuation coverage
28terminates under a prior group benefit plan pursuant to Section
29 10128.57 may continue their coverage for the balance of the period
30that the qualified beneficiary would have remained covered under
31the prior group benefit plan, including the requirements for election
32and payment. The disclosure shall clearly state that continuation
33coverage shall terminate if the qualified beneficiary fails to comply
34with the requirements pertaining to enrollment in, and payment of
35premiums to, the new group benefit plan within 30 days of
36receiving notice of the termination of the prior group benefit plan.

37(d) Prior to August 1, 1998, every insurer shall provide to all
38covered employees of employers subject to this article written
39notice containing the disclosures required by this section, or shall
40provide to all covered employees of employers subject to this
P45   1article a new or amended evidence of coverage that includes the
2disclosures required by this section. Any insurer that, in the
3ordinary course of business, maintains only the addresses of
4employer group purchasers of benefits, and does not maintain
5addresses of covered employees, may comply with the notice
6requirements of this section through the provision of the notices
7to its employer group purchases of benefits.

8(e) Every disclosure form issued, amended, or renewed on and
9after January 1, 1999, for a group benefit plan subject to this article
10shall provide a notice that, under state law, an insured may be
11entitled to continuation of group coverage and that additional
12information regarding eligibility for this coverage may be found
13in the evidence of coverage.

14(f) A disclosure issued, amended, or renewed on or after July
151, 2016, for a group benefit plan subject to this article shall include
16the following notice:

17

18“In addition to your coverage continuation options, you may be
19eligible for the following:

201. Coverage through the state health insurance marketplace, also
21known as Covered California. By enrolling through Covered
22California, you may qualify for lower monthly premiums and lower
23out-of-pocket costs. Your family members may also qualify for
24coverage through Covered California.

252. Coverage through Medi-Cal. Depending on your income, you
26may qualify for low or no-cost coverage through Medi-Cal. Your
27family members may also qualify for Medi-Cal.

283. Coverage through an insured spouse. If your spouse has
29coverage that extends to family members, you may be able to be
30added on that benefit plan.

31Be aware that there is a deadline to enroll in Covered California,
32although you can apply for Medi-Cal at anytime. To find out more
33about how to apply for Covered California and Medi-Cal, visit the
34Covered California Internet Web site at
35http://www.coveredca.com.”
36

37(g) (1) If Section 5000A of the Internal Revenue Code, as added
38by Section 1501 of PPACA, is repealed or amended to no longer
39apply to the individual market, as defined in Section 2791 of the
40federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
P46   1section shall become inoperative and is repealed 12 months after
2the date of that repeal or amendment.

3(2) For purposes of this subdivision, “PPACA” means the federal
4Patient Protection and Affordable Care Act (Public Law 111-148),
5as amended by the federal Health Care and Education
6Reconciliation Act of 2010 (Public Law 111-152), and any rules,
7regulations, or guidance issued pursuant to that law.

8

SEC. 9.  

Section 10128.54 is added to the Insurance Code, to
9read:

10

10128.54.  

(a) Every insurer’s evidence of coverage for group
11benefit plans subject to this article, that is issued, amended, or
12renewed on or after January 1, 1999, shall disclose to covered
13employees of group benefit plans subject to this article the ability
14to continue coverage pursuant to this article, as required by this
15section.

16(b) This disclosure shall state that all insureds who are eligible
17to be qualified beneficiaries, as defined in subdivision (c) of
18Section 10128.51, shall be required, as a condition of receiving
19benefits pursuant to this article, to notify, in writing, the insurer,
20or the employer if the employer contracts to perform the
21administrative services as provided for in Section 10128.55, of all
22qualifying events as specified in paragraphs (1), (3), (4), and (5)
23of subdivision (d) of Section 10128.51 within 60 days of the date
24of the qualifying event. This disclosure shall inform insureds that
25failure to make the notification to the insurer, or to the employer
26when under contract to provide the administrative services, within
27the required 60 days will disqualify the qualified beneficiary from
28receiving continuation coverage pursuant to this article. The
29disclosure shall further state that a qualified beneficiary who wishes
30to continue coverage under the group benefit plan pursuant to this
31article must request the continuation in writing and deliver the
32written request, by first-class mail, or other reliable means of
33delivery, including personal delivery, express mail, or private
34courier company, to the disability insurer, or to the employer if
35the plan has contracted with the employer for administrative
36services pursuant to subdivision (d) of Section 10128.55, within
37the 60-day period following the later of (1) the date that the
38insured’s coverage under the group benefit plan terminated or will
39terminate by reason of a qualifying event, or (2) the date the insured
40was sent notice pursuant to subdivision (e) of Section 10128.55
P47   1of the ability to continue coverage under the group benefit plan.
2The disclosure required by this section shall also state that a
3qualified beneficiary electing continuation shall pay to the disability
4insurer, in accordance with the terms and conditions of the policy
5or contract, which shall be set forth in the notice to the qualified
6beneficiary pursuant to subdivision (d) of Section 10128.55, the
7amount of the required premium payment, as set forth in Section
810128.56. The disclosure shall further require that the qualified
9beneficiary’s first premium payment required to establish premium
10payment be delivered by first-class mail, certified mail, or other
11reliable means of delivery, including personal delivery, express
12mail, or private courier company, to the disability insurer, or to
13 the employer if the employer has contracted with the insurer to
14perform the administrative services pursuant to subdivision (d) of
15Section 10128.55, within 45 days of the date the qualified
16beneficiary provided written notice to the insurer or the employer,
17if the employer has contracted to perform the administrative
18services, of the election to continue coverage in order for coverage
19to be continued under this article. This disclosure shall also state
20that the first premium payment must equal an amount sufficient
21to pay all required premiums and all premiums due, and that failure
22to submit the correct premium amount within the 45-day period
23will disqualify the qualified beneficiary from receiving continuation
24coverage pursuant to this article.

25(c) The disclosure required by this section shall also describe
26separately how qualified beneficiaries whose continuation coverage
27terminates under a prior group benefit plan pursuant to Section
2810128.57 may continue their coverage for the balance of the period
29that the qualified beneficiary would have remained covered under
30the prior group benefit plan, including the requirements for election
31and payment. The disclosure shall clearly state that continuation
32coverage shall terminate if the qualified beneficiary fails to comply
33with the requirements pertaining to enrollment in, and payment of
34premiums to, the new group benefit plan within 30 days of
35receiving notice of the termination of the prior group benefit plan.

36(d) Prior to August 1, 1998, every insurer shall provide to all
37covered employees of employers subject to this article written
38notice containing the disclosures required by this section, or shall
39provide to all covered employees of employers subject to this
40article a new or amended evidence of coverage that includes the
P48   1disclosures required by this section. Any insurer that, in the
2ordinary course of business, maintains only the addresses of
3employer group purchasers of benefits, and does not maintain
4addresses of covered employees, may comply with the notice
5requirements of this section through the provision of the notices
6to its employer group purchases of benefits.

7(e) Every disclosure form issued, amended, or renewed on or
8after January 1, 1999, for a group benefit plan subject to this article
9shall provide a notice that, under state law, an insured may be
10entitled to continuation of group coverage and that additional
11information regarding eligibility for this coverage may be found
12in the evidence of coverage.

13(f) Every disclosure issued, amended, or renewed on or after
14the operative date of this section for a group benefit plan subject
15to this article shall include the following notice:

16

17“Please examine your options carefully before declining this
18coverage. You should be aware that companies selling individual
19health insurance typically require a review of your medical history
20that could result in a higher premium or you could be denied
21coverage entirely.”
22

23(g) A disclosure issued, amended, or renewed on or after July
241, 2016, for a group benefit plan subject to this article shall include
25the following notice:

26

27“In addition to your coverage continuation options, you may be
28eligible for the following:

291. Coverage through the state health insurance marketplace, also
30known as Covered California. By enrolling through Covered
31California, you may qualify for lower monthly premiums and lower
32out-of-pocket costs. Your family members may also qualify for
33coverage through Covered California.

342. Coverage through Medi-Cal. Depending on your income, you
35may qualify for low or no-cost coverage through Medi-Cal. Your
36family members may also qualify for Medi-Cal.

373. Coverage through an insured spouse. If your spouse has
38coverage that extends to family members, you may be able to be
39added on that benefit plan.

P49   1Be aware that there is a deadline to enroll in Covered California,
2although you can apply for Medi-Cal anytime. To find out more
3about how to apply for Covered California and Medi-Cal, visit the
4Covered California Internet Web site at
5http://www.coveredca.com.”
6

7(h) (1) If Section 5000A of the Internal Revenue Code, as added
8by Section 1501 of PPACA, is repealed or amended to no longer
9apply to the individual market, as defined in Section 2791 of the
10federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
11section shall become operative 12 months after the date of that
12repeal or amendment.

13(2) For purposes of this subdivision, “PPACA” means the federal
14Patient Protection and Affordable Care Act (Public Law 111-148),
15as amended by the federal Health Care and Education
16Reconciliation Act of 2010 (Public Law 111-152), and any rules,
17regulations, or guidance issued pursuant to that law.

18

SEC. 10.  

Section 10128.55 of the Insurance Code is amended
19to read:

20

10128.55.  

(a) Every group benefit plan contract between a
21disability insurer and an employer subject to this article that is
22issued, amended, or renewed on or after July 1, 1998, shall require
23the employer to notify the insurer in writing of any employee who
24has had a qualifying event, as defined in paragraph (2) of
25subdivision (d) of Section 10128.51, within 30 days of the
26qualifying event. The group contract shall also require the employer
27to notify the insurer, in writing, within 30 days of the date when
28the employer becomes subject to Section 4980B of the United
29States Internal Revenue Code or Chapter 18 of the Employee
30Retirement Income Security Act (29 U.S.C. Sec. 1161 et seq.).

31(b) Every group benefit plan contract between a disability insurer
32and an employer subject to this article that is issued, amended, or
33renewed after July 1, 1998, shall require the employer to notify
34qualified beneficiaries currently receiving continuation coverage,
35whose continuation coverage will terminate under one group
36benefit plan prior to the end of the period the qualified beneficiary
37would have remained covered, as specified in Section 10128.57,
38of the qualified beneficiary’s ability to continue coverage under a
39new group benefit plan for the balance of the period the qualified
40beneficiary would have remained covered under the prior group
P50   1benefit plan. This notice shall be provided either 30 days prior to
2the termination or when all enrolled employees are notified,
3whichever is later.

4Every disability insurer shall provide to the employer replacing
5a group benefit plan policy issued by the insurer, or to the
6employer’s agent or broker representative, within 15 days of any
7written request, information in possession of the insurer reasonably
8required to administer the notification requirements of this
9subdivision and subdivision (c).

10(c) Notwithstanding subdivision (a), the group benefit plan
11contract between the insurer and the employer shall require the
12employer to notify the successor plan in writing of the qualified
13beneficiaries currently receiving continuation coverage so that the
14successor plan, or contracting employer or administrator, may
15provide those qualified beneficiaries with the necessary premium
16information, enrollment forms, and instructions consistent with
17the disclosure required by subdivision (c) of Section 10128.54 and
18subdivision (e) of this section to allow the qualified beneficiary to
19continue coverage. This information shall be sent to all qualified
20beneficiaries who are enrolled in the group benefit plan and those
21qualified beneficiaries who have been notified, pursuant to Section
2210128.54 of their ability to continue their coverage and may still
23elect coverage within the specified 60-day period. This information
24shall be sent to the qualified beneficiary’s last known address, as
25provided to the employer by the health care service plan or,
26disability insurer currently providing continuation coverage to the
27qualified beneficiary. The successor insurer shall not be obligated
28to provide this information to qualified beneficiaries if the
29employer or prior insurer or health care service plan fails to comply
30with this section.

31(d) A disability insurer may contract with an employer, or an
32administrator, to perform the administrative obligations of the plan
33as required by this article, including required notifications and
34collecting and forwarding premiums to the insurer. Except for the
35requirements of subdivisions (a), (b), and (c), this subdivision shall
36not be construed to permit an insurer to require an employer to
37perform the administrative obligations of the insurer as required
38by this article as a condition of the issuance or renewal of coverage.

39(e) Every insurer, or employer or administrator that contracts
40to perform the notice and administrative services pursuant to this
P51   1section, shall, within 14 days of receiving a notice of a qualifying
2event, provide to the qualified beneficiary the necessary premium
3information, enrollment forms, and disclosures consistent with the
4notice requirements contained in subdivisions (b) and (c) of Section
510128.54 to allow the qualified beneficiary to formally elect
6continuation coverage. This information shall be sent to the
7qualified beneficiary’s last known address.

8(f) Every insurer, or employer or administrator that contracts
9to perform the notice and administrative services pursuant to this
10section, shall, during the 180-day period ending on the date that
11continuation coverage is terminated pursuant to paragraphs (1),
12(3), and (5) of subdivision (a) of Section 10128.57, notify a
13qualified beneficiary who has elected continuation coverage
14pursuant to this article of the date that his or her coverage will
15terminate, and shall notify the qualified beneficiary of any
16conversion coverage available to that qualified beneficiary. This
17requirement shall not apply when the continuation coverage is
18terminated because the group contract between the insurer and the
19employer is being terminated.

20(g) (1) An insurer shall provide to a qualified beneficiary who
21has a qualifying event during the period specified in subparagraph
22(A) of paragraph (3) of subdivision (a) of Section 3001 of ARRA,
23a written notice containing information on the availability of
24premium assistance under ARRA. This notice shall be sent to the
25qualified beneficiary’s last known address. The notice shall include
26clear and easily understandable language to inform the qualified
27beneficiary that changes in federal law provide a new opportunity
28to elect continuation coverage with a 65-percent premium subsidy
29and shall include all of the following:

30(A) The amount of the premium the person will pay. For
31qualified beneficiaries who had a qualifying event between
32September 1, 2008, and May 12, 2009, inclusive, if an insurer is
33unable to provide the correct premium amount in the notice, the
34notice may contain the last known premium amount and an
35opportunity for the qualified beneficiary to request, through a
36toll-free telephone number, the correct premium that would apply
37to the beneficiary.

38(B) Enrollment forms and any other information required to be
39included pursuant to subdivision (e) to allow the qualified
40beneficiary to elect continuation coverage. This information shall
P52   1not be included in notices sent to qualified beneficiaries currently
2enrolled in continuation coverage.

3(C) A description of the option to enroll in different coverage
4as provided in subparagraph (B) of paragraph (1) of subdivision
5(a) of Section 3001 of ARRA. This description shall advise the
6qualified beneficiary to contact the covered employee’s former
7employer for prior approval to choose this option.

8(D) The eligibility requirements for premium assistance in the
9amount of 65 percent of the premium under Section 3001 of
10ARRA.

11(E) The duration of premium assistance available under ARRA.

12(F) A statement that a qualified beneficiary eligible for premium
13assistance under ARRA may elect continuation coverage no later
14than 60 days of the date of the notice.

15(G) A statement that a qualified beneficiary eligible for premium
16assistance under ARRA who rejected or discontinued continuation
17coverage prior to receiving the notice required by this subdivision
18has the right to withdraw that rejection and elect continuation
19coverage with the premium assistance.

20(H) A statement that reads as follows:


22“IF YOU ARE HAVING ANY DIFFICULTIES READING OR
23UNDERSTANDING THIS NOTICE, PLEASE CONTACT [name
24of insurer] at [insert appropriate telephone number].”
25


26(2) With respect to qualified beneficiaries who had a qualifying
27 event between September 1, 2008, and May 12, 2009, inclusive,
28the notice described in this subdivision shall be provided by the
29later of May 26, 2009, or seven business days after the date the
30insurer receives notice of the qualifying event.

31(3) With respect to qualified beneficiaries who had or have a
32qualifying event between May 13, 2009, and the later date specified
33in subparagraph (A) of paragraph (3) of subdivision (a) of Section
343001 of ARRA, inclusive, the notice described in this subdivision
35shall be provided within the period of time specified in subdivision
36(e).

37(4) Nothing in this section shall be construed to require an
38insurer to provide the insurer’s evidence of coverage as a part of
39the notice required by this subdivision, and nothing in this section
40shall be construed to require an insurer to amend its existing
P53   1evidence of coverage to comply with the changes made to this
2section by the enactment of Assembly Bill 23 of the 2009-10
3Regular Session or by the act amending this section during the
4second year of the 2009-10 Regular Session.

5(5) The requirement under this subdivision to provide a written
6notice to a qualified beneficiary and the requirement under
7paragraph (1) of subdivision (i) to provide a new opportunity to a
8qualified beneficiary to elect continuation coverage shall be deemed
9satisfied if an insurer previously provided a written notice and
10additional election opportunity under Section 3001 of ARRA to
11that qualified beneficiary prior to the effective date of the act
12adding this paragraph.

13(h) A group contract between a group benefit plan and an
14employer subject to this article that is issued, amended, or renewed
15on or after July 1, 2016, shall require the employer to give the
16following notice to a qualified beneficiary in connection with a
17notice regarding election of continuation coverage:

18

19“In addition to your coverage continuation options, you may be
20eligible for the following:

211. Coverage through the state health insurance marketplace, also
22known as Covered California. By enrolling through Covered
23California, you may qualify for lower monthly premiums and lower
24out-of-pocket costs. Your family members may also qualify for
25coverage through Covered California.

262. Coverage through Medi-Cal. Depending on your income, you
27may qualify for low or no-cost coverage through Medi-Cal. Your
28family members may also qualify for Medi-Cal.

293. Coverage through an insured spouse. If your spouse has
30coverage that extends to family members, you may be able to be
31added on that benefit plan.

32Be aware that there is a deadline to enroll in Covered California,
33although you can apply for Medi-Cal anytime. To find out more
34about how to apply for Covered California and Medi-Cal, visit the
35Covered California Internet Web site at
36http://www.coveredca.com.”
37

38(i) (1) Notwithstanding any other law, a qualified beneficiary
39eligible for premium assistance under ARRA may elect
P54   1continuation coverage no later than 60 days after the date of the
2notice required by subdivision (g).

3(2) For a qualified beneficiary who elects to continue coverage
4pursuant to this subdivision, the period beginning on the date of
5the qualifying event and ending on the effective date of the
6continuation coverage shall be disregarded for purposes of
7calculating a break in coverage in determining whether a
8preexisting condition provision applies under subdivision (e) of
9Section 10198.7 or subdivision (c) of Section 10708.

10(3) For a qualified beneficiary who had a qualifying event
11between September 1, 2008, and February 16, 2009, inclusive, and
12who elects continuation coverage pursuant to paragraph (1), the
13continuation coverage shall commence on the first day of the month
14following the election.

15(4) For a qualified beneficiary who had a qualifying event
16between February 17, 2009, and May 12, 2009, inclusive, and who
17elects continuation coverage pursuant to paragraph (1), the effective
18date of the continuation coverage shall be either of the following,
19at the option of the beneficiary, provided that the beneficiary pays
20the applicable premiums:

21(A) The date of the qualifying event.

22(B) The first day of the month following the election.

23(5) Notwithstanding any other law, a qualified beneficiary who
24is eligible for the special election period described in paragraph
25(17) of subdivision (a) of Section 3001 of ARRA may elect
26continuation coverage no later than 60 days after the date of the
27notice required under subdivision (k). For a qualified beneficiary
28who elects coverage pursuant to this paragraph, the continuation
29coverage shall be effective as of the first day of the first period of
30coverage after the date of termination of employment, except, if
31federal law permits, coverage shall take effect on the first day of
32the month following the election. However, for purposes of
33calculating the duration of continuation coverage pursuant to
34Section 10128.57, the period of that coverage shall be determined
35as though the qualifying event was a reduction of hours of the
36employee.

37(6) Notwithstanding any other law, a qualified beneficiary who
38is eligible for any other special election period under ARRA may
39elect continuation coverage no later than 60 days after the date of
40the special election notice required under ARRA.

P55   1(j) An insurer shall provide a qualified beneficiary eligible for
2premium assistance under ARRA written notice of the extension
3of that premium assistance as required under Section 3001 of
4ARRA.

5(k) A health insurer, or an administrator or employer if
6administrative obligations have been assumed by those entities
7pursuant to subdivision (d), shall give the qualified beneficiaries
8described in subparagraph (C) of paragraph (17) of subdivision
9(a) of Section 3001 of ARRA the written notice required by that
10paragraph by implementing the following procedures:

11(1) The insurer shall, within 14 days of the effective date of the
12act adding this subdivision, send a notice to employers currently
13contracting with the insurer for a group benefit plan subject to this
14article. The notice shall do all of the following:

15(A) Advise the employer that employees whose employment is
16terminated on or after March 2, 2010, who were previously enrolled
17in any group health care service plan or health insurance policy
18offered by the employer may be entitled to special health coverage
19rights, including a subsidy paid by the federal government for a
20portion of the premium.

21(B) Ask the employer to provide the insurer with the name,
22address, and date of termination of employment for any employee
23whose employment is terminated on or after March 2, 2010, and
24who was at any time covered by any health care service plan or
25health insurance policy offered to their employees on or after
26September 1, 2008.

27(C) Provide employers with a format and instructions for
28submitting the information to the insurer, or their administrator or
29employer who has assumed administrative obligations pursuant
30to subdivision (d), by telephone, fax, electronic mail, or mail.

31(2) Within 14 days of receipt of the information specified in
32paragraph (1) from the employer, the insurer shall send the written
33notice specified in paragraph (17) of subdivision (a) of Section
343001 of ARRA to those individuals.

35(3) If an individual contacts his or her health insurer and
36indicates that he or she experienced a qualifying event that entitles
37him or her to the special election period described in paragraph
38(17) of subdivision (a) of Section 3001 of ARRA or any other
39special election provision of ARRA, the insurer shall provide the
40individual with the notice required under paragraph (17) of
P56   1subdivision (a) of Section 3001 of ARRA or any other applicable
2provision of ARRA, regardless of whether the insurer receives or
3received information from the individual’s previous employer
4regarding that individual pursuant to Section 24100 of the Health
5and Safety Code. The insurer shall review the individual’s
6application for coverage under this special election notice to
7determine if the individual qualifies for the special election period
8and the premium assistance under ARRA. The insurer shall comply
9with paragraph (5) if the individual does not qualify for either the
10special election period or premium assistance under ARRA.

11(4) The requirement under this subdivision to provide the written
12notice described in paragraph (17) of subdivision (a) of Section
133001 of ARRA to a qualified beneficiary and the requirement
14under paragraph (5) of subdivision (i) to provide a new opportunity
15to a qualified beneficiary to elect continuation coverage shall be
16deemed satisfied if a health insurer previously provided the written
17notice and additional election opportunity described in paragraph
18(17) of subdivision (a) of Section 3001 of ARRA to that qualified
19beneficiary prior to the effective date of the act adding this
20paragraph.

21(5) If an individual does not qualify for either a special election
22period or the subsidy under ARRA, the insurer shall provide a
23written notice to that individual that shall include information on
24the right to appeal as set forth in Section 3001 of ARRA.

25(6) A health insurer shall provide information on its publicly
26accessible Internet Web site regarding the premium assistance
27made available under ARRA and any special election period
28provided under that law. An insurer may fulfill this requirement
29by linking or otherwise directing consumers to the information
30regarding COBRA continuation coverage premium assistance
31located on the Internet Web site of the United States Department
32of Labor. The information required by this paragraph shall be
33located in a section of the insurer’s Internet Web site that is readily
34accessible to consumers, such as the Web site’s Frequently Asked
35Questions section.

36(l) Notwithstanding any other law, a qualified beneficiary
37eligible for premium assistance under ARRA may elect to enroll
38in different coverage subject to the criteria provided under
39subparagraph (B) of paragraph (1) of subdivision (a) of Section
403001 of ARRA.

P57   1(m) A qualified beneficiary enrolled in continuation coverage
2as of February 17, 2009, who is eligible for premium assistance
3under ARRA may request application of the premium assistance
4as of March 1, 2009, or later, consistent with ARRA.

5(n) An insurer that receives an election notice from a qualified
6beneficiary eligible for premium assistance under ARRA, pursuant
7to subdivision (i), shall be considered a person entitled to
8reimbursement, as defined in Section 6432(b)(3) of the Internal
9Revenue Code, as amended by paragraph (12) of subdivision (a)
10of Section 3001 of ARRA.

11(o) (1) For purposes of compliance with ARRA, in the absence
12of guidance from, or if specifically required for state-only
13continuation coverage by, the United States Department of Labor,
14the Internal Revenue Service, or the Centers for Medicare and
15Medicaid Services, an insurer may request verification of the
16involuntary termination of a covered employee’s employment from
17the covered employee’s former employer or the qualified
18beneficiary seeking premium assistance under ARRA.

19(2) An insurer that requests verification pursuant to paragraph
20(1) directly from a covered employee’s former employer shall do
21so by providing a written notice to the employer. This written
22notice shall be sent by mail or facsimile to the covered employee’s
23former employer within seven business days from the date the
24insurer receives the qualified beneficiary’s election notice pursuant
25to subdivision (i). Within 10 calendar days of receipt of written
26notice required by this paragraph, the former employer shall furnish
27to the insurer written verification as to whether the covered
28employee’s employment was involuntarily terminated.

29(3) A qualified beneficiary requesting premium assistance under
30ARRA may furnish to the insurer a written document or other
31information from the covered employee’s former employer
32indicating that the covered employee’s employment was
33involuntarily terminated. This document or information shall be
34deemed sufficient by the insurer to establish that the covered
35employee’s employment was involuntarily terminated for purposes
36of ARRA, unless the insurer makes a reasonable and timely
37determination that the documents or information provided by the
38qualified beneficiary are legally insufficient to establish involuntary
39termination of employment.

P58   1(4) If an insurer requests verification pursuant to this subdivision
2and cannot verify involuntary termination of employment within
314 business days from the date the employer receives the
4verification request or from the date the insurer receives
5documentation or other information from the qualified beneficiary
6pursuant to paragraph (3), the insurer shall either provide
7continuation coverage with the federal premium assistance to the
8qualified beneficiary or send the qualified beneficiary a denial
9letter which shall include notice of his or her right to appeal that
10determination pursuant to ARRA.

11(5) No person shall intentionally delay verification of
12involuntary termination of employment under this subdivision.

13(p) (1) If Section 5000A of the Internal Revenue Code, as added
14by Section 1501 of PPACA, is repealed or amended to no longer
15apply to the individual market, as defined in Section 2791 of the
16federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
17section shall become inoperative and is repealed 12 months after
18the date of that repeal or amendment.

19(2) For purposes of this subdivision, “PPACA” means the federal
20Patient Protection and Affordable Care Act (Public Law 111-148),
21as amended by the federal Health Care and Education
22Reconciliation Act of 2010 (Public Law 111-152), and any rules,
23regulations, or guidance issued pursuant to that law.

24

SEC. 11.  

Section 10128.55 is added to the Insurance Code, to
25read:

26

10128.55.  

(a) Every group benefit plan contract between a
27disability insurer and an employer subject to this article that is
28issued, amended, or renewed on or after July 1, 1998, shall require
29the employer to notify the insurer in writing of any employee who
30has had a qualifying event, as defined in paragraph (2) of
31subdivision (d) of Section 10128.51, within 30 days of the
32qualifying event. The group contract shall also require the employer
33to notify the insurer, in writing, within 30 days of the date when
34the employer becomes subject to Section 4980B of the United
35States Internal Revenue Code or Chapter 18 of the Employee
36Retirement Income Security Act (29 U.S.C. Sec. 1161 et seq.).

37(b) Every group benefit plan contract between a disability insurer
38and an employer subject to this article that is issued, amended, or
39renewed after July 1, 1998, shall require the employer to notify
40qualified beneficiaries currently receiving continuation coverage,
P59   1whose continuation coverage will terminate under one group
2benefit plan prior to the end of the period the qualified beneficiary
3would have remained covered, as specified in Section 10128.57,
4of the qualified beneficiary’s ability to continue coverage under a
5new group benefit plan for the balance of the period the qualified
6beneficiary would have remained covered under the prior group
7benefit plan. This notice shall be provided either 30 days prior to
8the termination or when all enrolled employees are notified,
9whichever is later.

10Every disability insurer shall provide to the employer replacing
11a group benefit plan policy issued by the insurer, or to the
12employer’s agent or broker representative, within 15 days of any
13written request, information in possession of the insurer reasonably
14required to administer the notification requirements of this
15subdivision and subdivision (c).

16(c) Notwithstanding subdivision (a), the group benefit plan
17contract between the insurer and the employer shall require the
18employer to notify the successor plan in writing of the qualified
19beneficiaries currently receiving continuation coverage so that the
20successor plan, or contracting employer or administrator, may
21provide those qualified beneficiaries with the necessary premium
22information, enrollment forms, and instructions consistent with
23the disclosure required by subdivision (c) of Section 10128.54 and
24subdivision (e) of this section to allow the qualified beneficiary to
25continue coverage. This information shall be sent to all qualified
26beneficiaries who are enrolled in the group benefit plan and those
27qualified beneficiaries who have been notified, pursuant to Section
2810128.54 of their ability to continue their coverage and may still
29elect coverage within the specified 60-day period. This information
30shall be sent to the qualified beneficiary’s last known address, as
31provided to the employer by the health care service plan or,
32disability insurer currently providing continuation coverage to the
33qualified beneficiary. The successor insurer shall not be obligated
34to provide this information to qualified beneficiaries if the
35employer or prior insurer or health care service plan fails to comply
36with this section.

37(d) A disability insurer may contract with an employer, or an
38administrator, to perform the administrative obligations of the plan
39as required by this article, including required notifications and
40collecting and forwarding premiums to the insurer. Except for the
P60   1requirements of subdivisions (a), (b), and (c), this subdivision shall
2not be construed to permit an insurer to require an employer to
3perform the administrative obligations of the insurer as required
4by this article as a condition of the issuance or renewal of coverage.

5(e) Every insurer, or employer or administrator that contracts
6to perform the notice and administrative services pursuant to this
7section, shall, within 14 days of receiving a notice of a qualifying
8event, provide to the qualified beneficiary the necessary premium
9information, enrollment forms, and disclosures consistent with the
10notice requirements contained in subdivisions (b) and (c) of Section
1110128.54 to allow the qualified beneficiary to formally elect
12continuation coverage. This information shall be sent to the
13qualified beneficiary’s last known address.

14(f) Every insurer, or employer or administrator that contracts
15to perform the notice and administrative services pursuant to this
16section, shall, during the 180-day period ending on the date that
17continuation coverage is terminated pursuant to paragraphs (1),
18(3), and (5) of subdivision (a) of Section 10128.57, notify a
19qualified beneficiary who has elected continuation coverage
20pursuant to this article of the date that his or her coverage will
21terminate, and shall notify the qualified beneficiary of any
22conversion coverage available to that qualified beneficiary. This
23requirement shall not apply when the continuation coverage is
24terminated because the group contract between the insurer and the
25employer is being terminated.

26(g) (1) An insurer shall provide to a qualified beneficiary who
27has a qualifying event during the period specified in subparagraph
28(A) of paragraph (3) of subdivision (a) of Section 3001 of ARRA,
29a written notice containing information on the availability of
30premium assistance under ARRA. This notice shall be sent to the
31qualified beneficiary’s last known address. The notice shall include
32clear and easily understandable language to inform the qualified
33 beneficiary that changes in federal law provide a new opportunity
34to elect continuation coverage with a 65-percent premium subsidy
35and shall include all of the following:

36(A) The amount of the premium the person will pay. For
37qualified beneficiaries who had a qualifying event between
38September 1, 2008, and May 12, 2009, inclusive, if an insurer is
39unable to provide the correct premium amount in the notice, the
40notice may contain the last known premium amount and an
P61   1opportunity for the qualified beneficiary to request, through a
2toll-free telephone number, the correct premium that would apply
3to the beneficiary.

4(B) Enrollment forms and any other information required to be
5included pursuant to subdivision (e) to allow the qualified
6beneficiary to elect continuation coverage. This information shall
7not be included in notices sent to qualified beneficiaries currently
8enrolled in continuation coverage.

9(C) A description of the option to enroll in different coverage
10as provided in subparagraph (B) of paragraph (1) of subdivision
11(a) of Section 3001 of ARRA. This description shall advise the
12qualified beneficiary to contact the covered employee’s former
13employer for prior approval to choose this option.

14(D) The eligibility requirements for premium assistance in the
15amount of 65 percent of the premium under Section 3001 of
16ARRA.

17(E) The duration of premium assistance available under ARRA.

18(F) A statement that a qualified beneficiary eligible for premium
19assistance under ARRA may elect continuation coverage no later
20than 60 days of the date of the notice.

21(G) A statement that a qualified beneficiary eligible for premium
22assistance under ARRA who rejected or discontinued continuation
23coverage prior to receiving the notice required by this subdivision
24has the right to withdraw that rejection and elect continuation
25coverage with the premium assistance.

26(H) A statement that reads as follows:


28“IF YOU ARE HAVING ANY DIFFICULTIES READING OR
29UNDERSTANDING THIS NOTICE, PLEASE CONTACT [name
30of insurer] at [insert appropriate telephone number].”
31


32(2) With respect to qualified beneficiaries who had a qualifying
33event between September 1, 2008, and May 12, 2009, inclusive,
34the notice described in this subdivision shall be provided by the
35later of May 26, 2009, or seven business days after the date the
36insurer receives notice of the qualifying event.

37(3) With respect to qualified beneficiaries who had or have a
38qualifying event between May 13, 2009, and the later date specified
39in subparagraph (A) of paragraph (3) of subdivision (a) of Section
403001 of ARRA, inclusive, the notice described in this subdivision
P62   1shall be provided within the period of time specified in subdivision
2(e).

3(4) Nothing in this section shall be construed to require an
4insurer to provide the insurer’s evidence of coverage as a part of
5the notice required by this subdivision, and nothing in this section
6shall be construed to require an insurer to amend its existing
7evidence of coverage to comply with the changes made to this
8section by the enactment of Assembly Bill 23 of the 2009-10
9Regular Session or by the act amending this section during the
10second year of the 2009-10 Regular Session.

11(5) The requirement under this subdivision to provide a written
12notice to a qualified beneficiary and the requirement under
13paragraph (1) of subdivision (h) to provide a new opportunity to
14a qualified beneficiary to elect continuation coverage shall be
15deemed satisfied if an insurer previously provided a written notice
16and additional election opportunity under Section 3001 of ARRA
17to that qualified beneficiary prior to the effective date of the act
18adding this paragraph.

19(h) A group contract between a group benefit plan and an
20employer subject to this article that is issued, amended, or renewed
21on or after the operative date of this section shall require the
22employer to give the following notice to a qualified beneficiary in
23connection with a notice regarding election of continuation
24coverage:

25

26“Please examine your options carefully before declining this
27coverage. You should be aware that companies selling individual
28health insurance typically require a review of your medical history
29that could result in a higher premium or you could be denied
30coverage entirely.”
31

32(i) A group contract between a group benefit plan and an
33employer subject to this article that is issued, amended, or renewed
34on or after July 1, 2016, shall require the employer to give the
35following notice to a qualified beneficiary in connection with a
36notice regarding election of continuation coverage:

37

38“In addition to your coverage continuation options, you may be
39eligible for the following:

P63   11. Coverage through the state health insurance marketplace, also
2known as Covered California. By enrolling through Covered
3California, you may qualify for lower monthly premiums and lower
4out-of-pocket costs. Your family members may also qualify for
5coverage through Covered California.

62. Coverage through Medi-Cal. Depending on your income, you
7may qualify

8for low or no-cost coverage through Medi-Cal. Your family
9members may also qualify for Medi-Cal.

103. Coverage through an insured spouse. If your spouse has
11coverage that extends to family members, you may be able to be
12added on that benefit plan.

13Be aware that there is a deadline to enroll in Covered California,
14although you can apply for Medi-Cal anytime. To find out more
15about how to apply for Covered California and Medi-Cal, visit the
16Covered California Internet Web site at
17http://www.coveredca.com.”
18

19(j) (1) Notwithstanding any other law, a qualified beneficiary
20eligible for premium assistance under ARRA may elect
21continuation coverage no later than 60 days after the date of the
22notice required by subdivision (g).

23(2) For a qualified beneficiary who elects to continue coverage
24pursuant to this subdivision, the period beginning on the date of
25the qualifying event and ending on the effective date of the
26continuation coverage shall be disregarded for purposes of
27calculating a break in coverage in determining whether a
28preexisting condition provision applies under subdivision (e) of
29Section 10198.7 or subdivision (c) of Section 10708.

30(3) For a qualified beneficiary who had a qualifying event
31between September 1, 2008, and February 16, 2009, inclusive, and
32who elects continuation coverage pursuant to paragraph (1), the
33continuation coverage shall commence on the first day of the month
34following the election.

35(4) For a qualified beneficiary who had a qualifying event
36between February 17, 2009, and May 12, 2009, inclusive, and who
37elects continuation coverage pursuant to paragraph (1), the effective
38date of the continuation coverage shall be either of the following,
39at the option of the beneficiary, provided that the beneficiary pays
40the applicable premiums:

P64   1(A) The date of the qualifying event.

2(B) The first day of the month following the election.

3(5) Notwithstanding any other law, a qualified beneficiary who
4is eligible for the special election period described in paragraph
5(17) of subdivision (a) of Section 3001 of ARRA may elect
6continuation coverage no later than 60 days after the date of the
7notice required under subdivision (l). For a qualified beneficiary
8who elects coverage pursuant to this paragraph, the continuation
9coverage shall be effective as of the first day of the first period of
10coverage after the date of termination of employment, except, if
11federal law permits, coverage shall take effect on the first day of
12the month following the election. However, for purposes of
13calculating the duration of continuation coverage pursuant to
14Section 10128.57, the period of that coverage shall be determined
15as though the qualifying event was a reduction of hours of the
16employee.

17(6) Notwithstanding any other law, a qualified beneficiary who
18is eligible for any other special election period under ARRA may
19elect continuation coverage no later than 60 days after the date of
20the special election notice required under ARRA.

21(k) An insurer shall provide a qualified beneficiary eligible for
22premium assistance under ARRA written notice of the extension
23of that premium assistance as required under Section 3001 of
24ARRA.

25(l) A health insurer, or an administrator or employer if
26administrative obligations have been assumed by those entities
27pursuant to subdivision (d), shall give the qualified beneficiaries
28described in subparagraph (C) of paragraph (17) of subdivision
29(a) of Section 3001 of ARRA the written notice required by that
30paragraph by implementing the following procedures:

31(1) The insurer shall, within 14 days of the effective date of the
32act adding this subdivision, send a notice to employers currently
33contracting with the insurer for a group benefit plan subject to this
34article. The notice shall do all of the following:

35(A) Advise the employer that employees whose employment is
36terminated on or after March 2, 2010, who were previously enrolled
37in any group health care service plan or health insurance policy
38offered by the employer may be entitled to special health coverage
39rights, including a subsidy paid by the federal government for a
40portion of the premium.

P65   1(B) Ask the employer to provide the insurer with the name,
2address, and date of termination of employment for any employee
3whose employment is terminated on or after March 2, 2010, and
4who was at any time covered by any health care service plan or
5health insurance policy offered to their employees on or after
6September 1, 2008.

7(C) Provide employers with a format and instructions for
8submitting the information to the insurer, or their administrator or
9employer who has assumed administrative obligations pursuant
10to subdivision (d), by telephone, fax, electronic mail, or mail.

11(2) Within 14 days of receipt of the information specified in
12paragraph (1) from the employer, the insurer shall send the written
13notice specified in paragraph (17) of subdivision (a) of Section
143001 of ARRA to those individuals.

15(3) If an individual contacts his or her health insurer and
16indicates that he or she experienced a qualifying event that entitles
17him or her to the special election period described in paragraph
18(17) of subdivision (a) of Section 3001 of ARRA or any other
19special election provision of ARRA, the insurer shall provide the
20individual with the notice required under paragraph (17) of
21subdivision (a) of Section 3001 of ARRA or any other applicable
22provision of ARRA, regardless of whether the insurer receives or
23received information from the individual’s previous employer
24regarding that individual pursuant to Section 24100 of the Health
25and Safety Code. The insurer shall review the individual’s
26application for coverage under this special election notice to
27determine if the individual qualifies for the special election period
28and the premium assistance under ARRA. The insurer shall comply
29with paragraph (5) if the individual does not qualify for either the
30special election period or premium assistance under ARRA.

31(4) The requirement under this subdivision to provide the written
32notice described in paragraph (17) of subdivision (a) of Section
333001 of ARRA to a qualified beneficiary and the requirement
34under paragraph (5) of subdivision (j) to provide a new opportunity
35to a qualified beneficiary to elect continuation coverage shall be
36deemed satisfied if a health insurer previously provided the written
37notice and additional election opportunity described in paragraph
38(17) of subdivision (a) of Section 3001 of ARRA to that qualified
39beneficiary prior to the effective date of the act adding this
40paragraph.

P66   1(5) If an individual does not qualify for either a special election
2period or the subsidy under ARRA, the insurer shall provide a
3written notice to that individual that shall include information on
4the right to appeal as set forth in Section 3001 of ARRA.

5(6) A health insurer shall provide information on its publicly
6accessible Internet Web site regarding the premium assistance
7made available under ARRA and any special election period
8provided under that law. An insurer may fulfill this requirement
9by linking or otherwise directing consumers to the information
10regarding COBRA continuation coverage premium assistance
11located on the Internet Web site of the United States Department
12of Labor. The information required by this paragraph shall be
13located in a section of the insurer’s Internet Web site that is readily
14accessible to consumers, such as the Web site’s Frequently Asked
15Questions section.

16(m) Notwithstanding any other law, a qualified beneficiary
17eligible for premium assistance under ARRA may elect to enroll
18in different coverage subject to the criteria provided under
19subparagraph (B) of paragraph (1) of subdivision (a) of Section
203001 of ARRA.

21(n) A qualified beneficiary enrolled in continuation coverage
22as of February 17, 2009, who is eligible for premium assistance
23under ARRA may request application of the premium assistance
24as of March 1, 2009, or later, consistent with ARRA.

25(o) An insurer that receives an election notice from a qualified
26beneficiary eligible for premium assistance under ARRA, pursuant
27to subdivision (j), shall be considered a person entitled to
28reimbursement, as defined in Section 6432(b)(3) of the Internal
29Revenue Code, as amended by paragraph (12) of subdivision (a)
30of Section 3001 of ARRA.

31(p) (1) For purposes of compliance with ARRA, in the absence
32of guidance from, or if specifically required for state-only
33continuation coverage by, the United States Department of Labor,
34the Internal Revenue Service, or the Centers for Medicare and
35Medicaid Services, an insurer may request verification of the
36involuntary termination of a covered employee’s employment from
37the covered employee’s former employer or the qualified
38beneficiary seeking premium assistance under ARRA.

39(2) An insurer that requests verification pursuant to paragraph
40(1) directly from a covered employee’s former employer shall do
P67   1so by providing a written notice to the employer. This written
2notice shall be sent by mail or facsimile to the covered employee’s
3former employer within seven business days from the date the
4insurer receives the qualified beneficiary’s election notice pursuant
5to subdivision (h). Within 10 calendar days of receipt of written
6notice required by this paragraph, the former employer shall furnish
7to the insurer written verification as to whether the covered
8employee’s employment was involuntarily terminated.

9(3) A qualified beneficiary requesting premium assistance under
10ARRA may furnish to the insurer a written document or other
11information from the covered employee’s former employer
12indicating that the covered employee’s employment was
13involuntarily terminated. This document or information shall be
14deemed sufficient by the insurer to establish that the covered
15employee’s employment was involuntarily terminated for purposes
16of ARRA, unless the insurer makes a reasonable and timely
17determination that the documents or information provided by the
18qualified beneficiary are legally insufficient to establish involuntary
19termination of employment.

20(4) If an insurer requests verification pursuant to this subdivision
21and cannot verify involuntary termination of employment within
2214 business days from the date the employer receives the
23verification request or from the date the insurer receives
24documentation or other information from the qualified beneficiary
25pursuant to paragraph (3), the insurer shall either provide
26continuation coverage with the federal premium assistance to the
27qualified beneficiary or send the qualified beneficiary a denial
28letter which shall include notice of his or her right to appeal that
29determination pursuant to ARRA.

30(5) No person shall intentionally delay verification of
31involuntary termination of employment under this subdivision.

32(q) (1) If Section 5000A of the Internal Revenue Code, as added
33by Section 1501 of PPACA, is repealed or amended to no longer
34apply to the individual market, as defined in Section 2791 of the
35federal Public Health Service Act (42 U.S.C. Sec. 300gg-91), this
36section shall become operative 12 months after the date of that
37repeal or amendment.

38(2) For purposes of this subdivision, “PPACA” means the federal
39Patient Protection and Affordable Care Act (Public Law 111-148),
40as amended by the federal Health Care and Education
P68   1Reconciliation Act of 2010 (Public Law 111-152), and any rules,
2regulations, or guidance issued pursuant to that law.

3

SEC. 12.  

No reimbursement is required by this act pursuant to
4Section 6 of Article XIII B of the California Constitution because
5the only costs that may be incurred by a local agency or school
6district will be incurred because this act creates a new crime or
7infraction, eliminates a crime or infraction, or changes the penalty
8for a crime or infraction, within the meaning of Section 17556 of
9the Government Code, or changes the definition of a crime within
10the meaning of Section 6 of Article XIII B of the California
11Constitution.

end delete


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