SB 1181, as introduced, Monning. Health care service plan 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 regulates the manner in which a plan makes premium or coverage changes to a contract, including requiring prescribed notice to enrollees 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 1374.21 of the Health and Safety Code
2 is amended to read:
(a) (1) A change in premium rates or changes in
4coverage stated in a group health care service plan contract shall
5not become effective unless the plan has deliveredbegin delete in writingend delete a
6begin insert writtenend insert notice indicating the change or changes at least 60 days
7prior to the contract renewal effective date.
8(2) The notice delivered pursuant to paragraph (1) for large
9group health plans shall also include the following information:
P2 1(A) Whether the rate proposed to be in effect is greater than the
2average rate
increase for individual market products negotiated by
3 the California Health Benefit Exchange for the most recent calendar
4year for which the rates are final.
5(B) Whether the rate proposed to be in effect is greater than the
6average rate increase negotiated by the Board of Administration
7of the Public Employees’ Retirement System for the most recent
8calendar year for which the rates are final.
9(C) Whether the rate change includes any portion of the excise
10tax paid by the health plan.
11(b) A health care service plan that declines to offer coveragebegin delete toend delete
12begin insert to,end insert or denies enrollmentbegin delete forend deletebegin insert
for,end insert a large group applying for coverage
13shall, at the time of the denial of coverage, provide the applicant
14with the specific reason or reasons for the decision in writing, in
15clear, easily understandable language.
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