BILL NUMBER: SB 657	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Monning

                        FEBRUARY 27, 2015

   An act to amend Section 1374.21 of the Health and Safety Code, and
to amend Section 10199.1 of the Insurance Code, relating to health
care coverage.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 657, as introduced, Monning. Health coverage: contracts.
   Existing law, the Knox-Keene Health Care Service Plan Act of 1975,
provides for the licensure and regulation of health care service
plans by the Department of Managed Health Care and makes a willful
violation of the act a crime. Existing law also provides for the
regulation of health insurers by the Department of Insurance.
Existing law regulates the manner in which a plan or insurer makes
premium or coverage changes to a contract, including requiring
prescribed notice to enrollees and insureds within a specified time
period.
   This bill would make technical, nonsubstantive changes to these
provisions.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1374.21 of the Health and Safety Code is
amended to read:
   1374.21.  (a)  No   A  change in premium
rates or changes in coverage stated in a group health care service
plan contract shall  not  become effective unless the plan
has delivered in writing a notice indicating the change or changes at
least 60 days prior to the contract renewal effective date.
   (b) A health care service plan that declines to offer coverage to
or denies enrollment for a large group applying for coverage shall,
at the time of the denial of coverage, provide the applicant with the
specific reason or reasons for the decision in writing, in clear,
easily understandable language.
  SEC. 2.  Section 10199.1 of the Insurance Code is amended to read:
   10199.1.  (a)  No   An  insurer or
nonprofit hospital service plan or administrator acting on its behalf
shall  not  terminate a group master policy or contract
providing hospital, medical, or surgical benefits, increase premiums
or charges therefor, reduce or eliminate benefits thereunder, or
restrict eligibility for coverage thereunder without providing prior
notice of that action.  No such   The 
action shall  not  become effective unless written notice of
the action was delivered by mail to the last known address of the
appropriate insurance producer and the appropriate administrator, if
any, at least 45 days prior to the effective date of the action and
to the last known address of the group policyholder or group
contractholder at least 60 days prior to the effective date of the
action. If nonemployee certificate holders or employees of more than
one employer are covered under the policy or contract, written notice
shall also be delivered by mail to the last known address of each
nonemployee certificate holder or affected employer or, if the action
does not affect all employees and dependents of one or more
employers, to the last known address of each affected employee
certificate holder, at least 60 days prior to the effective date of
the action.
   (b)  No   A  holder of a master group
policy or a master group nonprofit hospital service plan contract or
administrator acting on its behalf shall  not  terminate the
coverage of, increase premiums or charges for, or reduce or
eliminate benefits available to, or restrict eligibility for coverage
of a covered person, employer unit, or class of certificate holders
covered under the policy or contract for hospital, medical, or
surgical benefits without first providing prior notice of the action.
 No such  The  action shall  not 
become effective unless written notice was delivered by mail to the
last known address of each affected nonemployee certificate holder or
employer, or if the action does not affect all employees and
dependents of one or more employers, to the last known address of
each affected employee certificate holder, at least 60 days prior to
the effective date of the action.
   (c) A health insurer that declines to offer coverage to or denies
enrollment for a large group applying for coverage shall, at the time
of the denial of coverage, provide the applicant with the specific
reason or reasons for the decision in writing, in clear, easily
understandable language.