BILL ANALYSIS
SENATE COMMITTEE ON INSURANCE
Senator Jackie Speier, Chair
SB 1092 (Sher) Hearing Date: April 4,
As Introduced: February 23, 2001
Fiscal: No
Urgency: No
SUMMARY
This bill would define "grievance" to include any written or oral
expression of dissatisfaction and would declare that where the health
care service plan (plan) is unable to distinguish between a grievance
and an inquiry, the plan shall deem the matter to be a grievance.
DIGEST
Existing law
1. Provides for the licensure and regulation of plans by the
Department of Managed Health Care (DMHC).
2. Requires that each plan establish and maintain a system approved
by DMHC whereby enrollees may submit their grievances to a plan.
This bill
1. Would define "grievance" to include any written or oral expression
of dissatisfaction, and shall include any complaint, dispute,
request for reconsideration, or appeal made by a subscriber or
enrollee or by his or her representative to a plan or to an entity
to which a plan has delegated authority to resolve grievances on
behalf of the plan.
2. Would declare that any uncertainty as to whether any expression of
dissatisfaction is an inquiry or grievance shall be resolved by
finding that it is a grievance.
3. Would provide technical clarification that also allows
"subscribers" to submit grievances to a plan.
COMMENTS
1. Purpose of the bill . The author states that the purpose of the
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bill is to establish a regulatory system that inspires consumer
confidence. The author believes that this can be accomplished
through the enactment of a broadly defined grievance statute that
would:
a. Ensure that all patient complaints would be treated
equally and that enrollees would not be disadvantaged if their
plan had failed to adopt a more broadly defined grievance
procedure.
b. Ensure that a verbal complaint is given the same weight
as a written complaint. The author notes that requiring
complaints in writing will disadvantage enrollees in lower
socio-economic levels of society who may be less likely to
effectively communicate their complaint in writing.
c. Discourage a plan from attempting to persuade enrollees
to not file a grievance in return for assurances from the plan
that their complaint would be worked out informally.
Finally, the author points out that the definition of grievance
used in this bill is consistent with the definition proposed by
DMHC and is similar to Blue Shield's definition: "Any written or
verbal communication that expresses specific dissatisfaction with
Blue Shield, its policies, procedures, actions, determinations,
employees, providers, or suppliers, that is received by Blue
Shield or on behalf of a member." Blue Cross defines grievance
as "An expression, either written or verbal, of dissatisfaction
where the member requests a formal investigation."
2. Support . The Western Center on Law and Poverty (WCLP) is the
sponsor of the bill and believes that defining "grievance" in a
fashion that is most favorable to consumers is necessary to comply
with the intent of the 1999-00 HMO reform legislation.
WCLP notes that, under the reform legislation, the responsibility
for licensure and regulation was shifted from the Department of
Corporations (DOC) to the newly created DMHC and believes that the
impetus for this change and the subsequent changes to the
grievance process was a desire for increased oversight of plans
and expanded consumer assistance.
WCLP asserts that the increased emphasis on resolving grievances
has led some of the plans to make the argument that "grievances"
should only include certain limited types of complaints, or to
only include communication where the enrollee requests that the
plan take specific action or change a prior decision. The sponsor
notes that some plans also proposed to limit grievance to
communications relating to benefit coverage, medical necessity
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determinations, quality of care, access to care, or quality of
service.
WCLP notes that the definition fostered by some plans is not as
broad as the one used by the DOC prior to the HMO reform
legislation. The sponsor hopes to codify DMHC's new and more
expansive definition of grievance.
3. Opposition . Blue Cross (BC) opposes the bill because it believes
the proposed definition of "grievance" is too broad and will lead
to more, rather than less, delays responding to consumer
complaints. BC asserts that current law requires that all plans
maintain a DMHC grievance system that allows enrollees to submit
their grievances to the plan. In addition, plans are required to
notify each enrollee upon enrollment and annually thereafter about
how to access the grievance system. Finally, DMHC has approved
grievance forms that the plans must use and requires the plan to
provide a written response to each grievance.
BC reports that it receives approximately 1.5 million routine
consumer calls per month. According to BC, roughly 25% of those
inquiries involve an issue that would meet the bill's definition
of grievance, even though they could be resolved quickly, over the
phone, or in a follow-up call. BC maintains that this bill would
require that it treat all of these calls as a formal grievance.
As such, BC would then be required to send each enrollee a
grievance letter explaining the reasons for its response, even
though the matter may have been resolved.
By forcing the plans to address routine calls through the formal
grievance process, BC asserts that the truly egregious complaints
would get lost in a "sea of routine matters."
4. Committee Comments . A technical amendment is recommended on page
2 line 6 to add "subscriber or" before "enrollee" in order to
maintain consistency with the change made on page 1 line 5 of the
bill.
POSITIONS
Support
Western Center on Law and Poverty (Sponsor)
California Medical Association'
Center for Public Interest Law
Children's Advocacy Institute
SB 1092, Page 4
Consumers Union
Health Access California
Oppose
Blue Cross of California
Health Insurance Association of America
Consultant: Michael A. Paiva