BILL NUMBER: AB 1152	CHAPTERED
	BILL TEXT

	CHAPTER   504
	FILED WITH SECRETARY OF STATE   OCTOBER 4, 1995
	APPROVED BY GOVERNOR   OCTOBER 3, 1995
	PASSED THE ASSEMBLY   SEPTEMBER 5, 1995
	PASSED THE SENATE   SEPTEMBER 1, 1995
	AMENDED IN SENATE   AUGUST 30, 1995
	AMENDED IN SENATE   JULY 19, 1995
	AMENDED IN SENATE   JULY 6, 1995
	AMENDED IN SENATE   JUNE 20, 1995
	AMENDED IN ASSEMBLY   MAY 26, 1995
	AMENDED IN ASSEMBLY   MAY 10, 1995
	AMENDED IN ASSEMBLY   APRIL 25, 1995
	AMENDED IN ASSEMBLY   APRIL 17, 1995

INTRODUCED BY  Assembly Member Bordonaro
   (Principal coauthor:  Assembly Member Gallegos)

                        FEBRUARY 23, 1995

   An act to add Section 1373.95 to the Health and Safety Code, and
to add Section 10133.55 to the Insurance Code, relating to health
coverage.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1152, Bordonaro.  Health coverage:  reimbursement of
traditional or terminated provider.
   Existing law provides for the licensure and regulation of health
care service plans administered by the Commissioner of Corporations.
Under existing law, willful violation of any of these provisions is
a misdemeanor.  Existing law also provides for the regulation of
policies of disability insurance and nonprofit hospital service plan
contracts administered by the Insurance Commissioner.  Existing law
requires that health care service plans, disability insurers, and
nonprofit hospital service plans provide coverage for certain
benefits and services.
   The bill would require, by July 1, 1996, health care service plans
that provide coverage on a group basis, certain group disability
insurance policies that provide coverage for hospital, medical, or
surgical benefits, and certain nonprofit hospital service plan
contracts that provide coverage on a group basis to file a written
policy with the Department of Corporations or Department of Insurance
regarding coverage for enrollees, insureds, or subscribers receiving
services during a current episode of care from a noncontracting
provider.  The bill would provide that the written policy shall
include, among other things, a description of the process used to
facilitate the continuity of patient care, and the review process of
requests to continue services with an existing provider.  The bill
would require that a copy of the policy be provided to enrollees,
insureds, and subscribers.
   By changing the definition of the crime applicable to health care
service plans, this bill would impose a state-mandated local program.

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


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


  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) The health care delivery system in California is increasingly
relying upon various forms of managed care to control the costs of
providing health care.
   (b) Strong provider-patient relationships, particularly for
patients with acute medical conditions, may enhance the curative
process.
   (c) Maintaining continuity of care as patients change providers
and health plans is important to the health and well-being of the
enrollees of managed care plans.
  SEC. 2.  Section 1373.95 is added to the Health and Safety Code,
immediately following Section 1373.9, to read:
   1373.95.  (a) On or before July 1, 1996, every health care service
plan that provides coverage on a group basis shall file with the
Department of Corporations, a written policy describing how the
health plan shall facilitate the continuity of care for new enrollees
receiving services during a current episode of care for an acute
condition from a nonparticipating provider.  This written policy
shall describe the process used to facilitate the continuity of care,
including the assumption of care by a participating provider.
Notice of the policy and information regarding how enrollees may
request a review under the policy shall be provided to all new
enrollees , except those enrollees who are not eligible as described
in subdivision (e).  A copy of the written policy shall be provided
to eligible enrollees upon request.
   (b) The written policy shall describe how requests to continue
services with an existing provider are reviewed by the plan.  The
policy shall ensure that reasonable consideration is given to the
potential clinical effect that a change of provider would have on the
enrollee's treatment for the acute condition.
   (c) A health care service plan may require any nonparticipating
provider whose services are continued pursuant to the written policy
to agree in writing to meet the same contractual terms and conditions
that are imposed upon the plan's participating providers, including
location within the plan's service area, reimbursement methodologies,
and rates of payment.  If the health care service plan determines
that a patient's health care treatment should temporarily continue
with the patient's existing provider, the health care service plan
shall not be liable for actions resulting solely from the negligence,
malpractice, or other tortious or wrongful acts arising out of the
provision of services by the existing provider.
   (d) Nothing in this section shall require a health care service
plan to cover services or provide benefits that are not otherwise
covered under the terms and conditions of the plan contract.
   (e) The written policy shall not apply to any enrollee who is
offered an out-of-network option, or who had the option to continue
with his or her previous health plan or provider and instead
voluntarily chose to change health plans.
   (f) This section shall not apply to health plan contracts that
include out-of-network coverage under which the enrollee is able to
obtain services from the enrollee's existing provider.
   (g) For purposes of this section, "provider" refers to a person
who is described in subdivision (f) of Section 900 of the Business
and Professions Code.
  SEC. 3.  Section 10133.55 is added to the Insurance Code, to read:

   10133.55.  (a) On or before July 1, 1996, every disability insurer
covering hospital, medical, and surgical expenses on a group basis,
or nonprofit hospital service plan providing coverage on a group
basis, that contracts with providers for alternative rates pursuant
to Section 10133 or Section 11512 and limit payments under those
policies and plans to services secured by insureds and subscribers
from providers charging alternative rates pursuant to these
contracts, shall file with the Department of Insurance, a written
policy describing how the health plan shall facilitate the continuity
of care for new insureds or enrollees receiving services during a
current episode of care for an acute condition from a noncontracting
provider.  This written policy shall describe the process used to
facilitate continuity of care, including the assumption of care by a
contracting provider.  Notice of the policy and information regarding
how insureds and subscribers may request a review under the policy
shall be provided to all new insureds and subscribers , except those
insureds or subscribers who are not eligible as described in
subdivision (e).  A copy of the written policy shall be provided to
eligible insureds and subscribers upon request.
   (b) The written policy shall describe how requests to continue
services with an existing noncontracting provider are reviewed by the
insurer or plan.  The policy shall ensure that reasonable
consideration is given to the potential clinical effect that a change
of provider would have on the insured's or subscriber's treatment
for the acute condition.
   (c) An insurer or plan may require any nonparticipating provider
whose services are continued pursuant to the written policy to agree
in writing to meet the same contractual terms and conditions that are
imposed upon the insurer's or plan's participating providers,
including location within the plan's service area, reimbursement
methodologies, and rates of payment.  If the insurer or plan
determines that a patient's health care treatment should temporarily
continue with the patient's existing provider, the insurer or plan
shall not be liable for actions resulting solely from the negligence,
malpractice, or other tortious or wrongful acts arising out of the
provision of services by the existing provider.
   (d) Nothing in this section shall require an insurer or plan to
cover services or provide benefits that are not otherwise covered
under the terms and conditions of the policy or plan contract.
   (e) The written policy shall not apply to any insured or
subscriber who is offered an out-of-network option, or who had the
option to continue with his or her previous health benefits carrier
or provider and instead voluntarily chose to change health plans.
   (f) This section shall not apply to health plan contracts that
include out-of-network coverage under which the insured or subscriber
is able to obtain services from the insured's or subscriber's
existing provider.
   (g) For purposes of this section, "provider" refers to a person
who is described in subdivision (f) of Section 900 of the Business
and Professions Code.
   (h) This section shall only apply to a group disability insurance
policy if it provides coverage for hospital, medical, or surgical
benefits.
  SEC. 4.  No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.
   Notwithstanding Section 17580 of the Government Code, unless
otherwise specified, the provisions of this act shall become
operative on the same date that the act takes effect pursuant to the
California Constitution.