BILL NUMBER: AB 1621 CHAPTERED
BILL TEXT
CHAPTER 788
FILED WITH SECRETARY OF STATE SEPTEMBER 24, 1998
APPROVED BY GOVERNOR SEPTEMBER 23, 1998
PASSED THE ASSEMBLY AUGUST 31, 1998
PASSED THE SENATE AUGUST 28, 1998
AMENDED IN SENATE AUGUST 27, 1998
AMENDED IN SENATE AUGUST 24, 1998
AMENDED IN SENATE AUGUST 20, 1998
AMENDED IN SENATE AUGUST 5, 1998
AMENDED IN SENATE JULY 15, 1998
AMENDED IN SENATE JULY 7, 1998
AMENDED IN ASSEMBLY MAY 22, 1998
AMENDED IN ASSEMBLY MARCH 26, 1998
AMENDED IN ASSEMBLY FEBRUARY 19, 1998
INTRODUCED BY Assembly Members Figueroa and Leach
(Principal coauthor: Assembly Member Thomson)
(Principal coauthor: Senator Maddy)
(Coauthors: Assembly Members Bordonaro, Cunneen, and Kuehl)
(Coauthor: Senator Watson)
JANUARY 5, 1998
An act to add Section 1367.63 to the Health and Safety Code, to
add Section 10123.88 to the Insurance Code, and to add Section
14132.62 to the Welfare and Institutions Code, relating to health
care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 1621, Figueroa. Health care coverage: reconstructive surgery.
Under existing law, health care service plans are subject to
licensure and regulation by the Commissioner of Corporations. Under
existing law, disability insurers are subject to licensure and
regulation by the Insurance Commissioner. Existing law establishes
the Medi-Cal program to provide health care benefits to low-income
individuals. Willful violation of the law regulating health care
service plans is a crime.
This bill would require certain health care service plan
contracts, and certain policies of disability insurance, issued,
amended, renewed, or delivered on or after July 1, 1999, to cover
reconstructive surgery, as defined, but would exclude coverage for
cosmetic surgery, as defined. The bill would authorize health care
service plans, certain disability insurers, and the Medi-Cal program
to utilize prior authorization and utilization review that may
include denial of proposed surgery under specified circumstances. It
would also require reconstructive surgery to be covered under the
Medi-Cal program on and after July 1, 1999.
By changing the definition of a crime relative to health care
service plans, the 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. In enacting this act, it is the intent of the
Legislature that health care service plans and disability insurers
shall cover surgical procedures for enrollees and insureds if it is
determined that the surgical procedures meet the definition of
reconstructive surgery set forth in this act. However, in enacting
subdivision (e) of Section 1367.63 of the Health and Safety Code,
Section 10123.88 of the Insurance Code, and Section 14132.62 of the
Welfare and Institutions Code, it is the intent of the Legislature
that health care service plans and disability insurers shall not be
required to cover a surgical procedure that will only result in a
minimal improvement in the appearance of the patient. The
determination of whether a surgery will produce only a minimal
improvement shall be based upon the standard of care as practiced by
physicians specializing in reconstructive surgery, and for services
provided under the Medi-Cal program (Chapter 7 (commencing with
Section 14000) of Part 3 of Division 9 of the Welfare and
Institutions Code), as specified in Section 14132.62 of the Welfare
and Institutions Code.
SEC. 2. Section 1367.63 is added to the Health and Safety Code, to
read:
1367.63. (a) Every health care service plan contract, except a
specialized health care service plan contract, that is issued,
amended, renewed, or delivered in this state on or after July 1,
1999, shall cover reconstructive surgery, as defined in subdivision
(c), that is necessary to achieve the purposes specified in
paragraphs (1) or (2) of subdivision (c). Nothing in this section
shall be construed to require a plan to provide coverage for cosmetic
surgery, as defined in subdivision (d).
(b) No individual, other than a licensed physician competent to
evaluate the specific clinical issues involved in the care requested,
may deny initial requests for authorization of coverage for
treatment pursuant to this section. For a treatment authorization
request submitted by a podiatrist or an oral and maxillofacial
surgeon, the request may be reviewed by a similarly licensed
individual, competent to evaluate the specific clinical issues
involved in the care requested.
(c) "Reconstructive surgery" means surgery performed to correct or
repair abnormal structures of the body caused by congenital defects,
developmental abnormalities, trauma, infection, tumors, or disease
to do either of the following:
(1) To improve function.
(2) To create a normal appearance, to the extent possible.
(d) "Cosmetic surgery" means surgery that is performed to alter or
reshape normal structures of the body in order to improve
appearance.
(e) In interpreting the definition of reconstructive surgery, a
health care service plan may utilize prior authorization and
utilization review that may include, but need not be limited to, any
of the following:
(1) Denial of the proposed surgery if there is another more
appropriate surgical procedure that will be approved for the
enrollee.
(2) Denial of the proposed surgery or surgeries if the procedure
or procedures, in accordance with the standard of care as practiced
by physicians specializing in reconstructive surgery, offer only a
minimal improvement in the appearance of the enrollee.
(3) Denial of payment for procedures performed without prior
authorization.
(4) For services provided under the Medi-Cal program (Chapter 7
(commencing with Section 14000) of Part 3 of Division 9 of the
Welfare and Institutions Code), denial of the proposed surgery if the
procedure offers only a minimal improvement in the appearance of the
enrollee, as may be defined in any regulations that may be
promulgated by the State Department of Health Services.
SEC. 3. Section 10123.88 is added to the Insurance Code, to read:
10123.88. (a) Every policy of disability insurance covering
hospital, medical, or surgical expenses that is issued, amended,
renewed, or delivered in this state on or after July 1, 1999, shall
cover reconstructive surgery, as defined in subdivision (c), that is
necessary to achieve the purposes specified in paragraphs (1) or (2)
of subdivision (c). Nothing in this section shall be construed to
require a policy to provide coverage for cosmetic surgery, as defined
in subdivision (d). This section shall only apply to health benefit
plans, as defined in subdivision (a) of Section 10198.6, except that
for accident only, specified disease, or hospital indemnity
insurance, coverage for benefits under this section shall apply to
the extent that the benefits are covered under the general terms and
conditions that apply to all other benefits under the policy.
Nothing in this section shall be construed as imposing a new benefit
mandate on accident only, specified disease, or hospital indemnity
insurance.
(b) No individual, other than a licensed physician competent to
evaluate the specific clinical issues involved in the care requested,
may deny initial requests for authorization of coverage for
treatment pursuant to this section. For a treatment authorization
request submitted by a podiatrist or an oral and maxillofacial
surgeon, the request may be reviewed by a similarly licensed
individual, competent to evaluate the specific clinical issues
involved in the care requested.
(c) "Reconstructive surgery" means surgery performed to correct or
repair abnormal structures of the body caused by congenital defects,
developmental abnormalities, trauma, infection, tumors, or disease
to do either of the following:
(1) To improve function.
(2) To create a normal appearance, to the extent possible.
(d) Nothing in this section shall be construed to require an
insurer to provide coverage for cosmetic surgery. "Cosmetic surgery"
means surgery that is performed to alter or reshape normal
structures of the body in order to improve the patient's appearance.
(e) In interpreting the definition of reconstructive surgery, an
insurer may utilize prior authorization and utilization review that
may include, but need not be limited to, any of the following:
(1) Denial of the proposed surgery if there is another more
appropriate surgical procedure that will be approved for the
enrollee.
(2) Denial of the proposed surgery or surgeries if the procedure
or procedures, in accordance with the standard of care as practiced
by physicians specializing in reconstructive surgery, offer only a
minimal improvement in the appearance of the enrollee.
(3) Denial of payment for procedures performed without prior
authorization.
SEC. 4. Section 14132.62 is added to the Welfare and Institutions
Code, to read:
14132.62. (a) Reconstructive surgery shall be covered under this
chapter, as defined in subdivision (c), when necessary to achieve the
purposes specified in paragraphs (1) or (2) of subdivision (c).
Nothing in this section shall be construed to require coverage for
cosmetic surgery, as defined in subdivision (d).
(b) No individual, other than a licensed physician competent to
evaluate the specific clinical issues involved in the care requested,
may deny initial requests for authorization of coverage for
treatment pursuant to this section. For a treatment authorization
request submitted by a podiatrist or an oral and maxillofacial
surgeon, the request may be reviewed by a similarly licensed
individual competent to evaluate the specific clinical issues
involved in the care requested.
(c) "Reconstructive surgery" means surgery performed on abnormal
structures of the body caused by congenital defects, developmental
abnormalities, trauma, infection, tumors, or disease to do either of
the following:
(1) To improve function.
(2) To create a normal appearance, to the extent possible.
(d) "Cosmetic surgery" means surgery that is performed to alter or
reshape normal structures of the body in order to improve
appearance.
(e) In connection with the interpretation of the definition of
reconstructive surgery, a proposed surgical procedure may be subject
to prior authorization and utilization review that may include, but
need not be limited to, denial under any of the following
circumstances:
(1) There is another more appropriate surgical procedure that will
be approved for the enrollee.
(2) The procedure or procedures offer only a minimal improvement
in the appearance of the enrollee, as defined in regulations adopted
by the department.
(3) Denial of payment for procedures performed without prior
authorization.
(f) This section shall become operative July 1, 1999.
SEC. 5. 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.