BILL NUMBER: AB 215	CHAPTERED  09/28/99

	CHAPTER   530
	FILED WITH SECRETARY OF STATE   SEPTEMBER 28, 1999
	APPROVED BY GOVERNOR   SEPTEMBER 27, 1999
	PASSED THE SENATE   SEPTEMBER 10, 1999
	PASSED THE ASSEMBLY   SEPTEMBER 10, 1999
	AMENDED IN SENATE   SEPTEMBER 10, 1999
	AMENDED IN SENATE   AUGUST 30, 1999
	AMENDED IN SENATE   JULY 1, 1999
	AMENDED IN ASSEMBLY   APRIL 6, 1999

INTRODUCED BY   Assembly Member Soto

                        JANUARY 25, 1999

   An act to add and repeal Section 1349.3 of the Health and Safety
Code, relating to health care coverage.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 215, Soto.  Health care coverage.
   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 Commissioner of Corporations and makes the willful
violation of these provisions subject to criminal sanction.
   The bill, until January 1, 2002, would prohibit a license with
waivers or limited license, on or after January 1, 2000, from being
issued to any person for provision of, or the arranging, payment, or
reimbursement for the provision of, health care services to enrollees
of another plan under certain risk-assuming contracts.  It would
also prohibit any licensed health care service plan, on and after
January 1, 2000, from contracting with any person, with certain
exceptions, for the assumption of financial risk with respect to
certain health care services and any other form of global capitation.

   Since a willful violation of the provisions applicable to health
care service plans is a crime, 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.  Section 1349.3 is added to the Health and Safety Code,
to read:
   1349.3.  (a) On or after January 1, 2000, no license with waivers
or limited license shall be issued to any person, including a
provider or an affiliate of a provider, for the provision of, or the
arranging, payment, or reimbursement for the provision of, health
care services to enrollees of another plan under a contract or other
arrangement whereby the person assumes financial risk for the
provision of at least both physician services and hospital inpatient
and ambulatory care services to the enrollees of the plan with which
the person proposes to contract or make an arrangement.  On and after
January 1, 2000, no licensed health care service plan shall contract
with any person, other than a licensed health care service plan or
licensed health care service plan with waivers, for the assumption of
financial risk with respect to the provision of both institutional
and noninstitutional health care services and any other form of
global capitation.  Nothing in this section may be construed to
prohibit or authorize, other than as provided by existing law, any
contracting for the assumption of financial risk for health care
services.
   (b) An applicant for a license with waivers or a limited license
that has an application on file with the director on August 1, 1999,
shall be entitled to a refund of the application filing fee paid as
of January 1, 2000.
   (c) This section shall remain in effect only until January 1,
2002, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2002, deletes or extends
that date.
  SEC. 2.  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.