BILL NUMBER: AB 562 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Cook
FEBRUARY 25, 2009
An act to add Article 12 (commencing with Section 1399.850) to
Chapter 2.2 of Division 2 of the Health and Safety Code, and to add
Chapter 7.5 (commencing with Section 10650) to Part 2 of Division 2
of the Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 562, as introduced, Cook. Health care coverage: report of claim
information.
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. Existing law provides
for the regulation of health insurers by the Department of
Insurance.
Existing law, the federal Health Insurance Portability and
Accountability Act of 1996, establishes certain requirements relating
to the provision of health insurance and the protection of privacy
of individually identifiable health information. The act authorizes
group health plans to permit health insurance issuers, as defined, to
disclose protected health information to plan sponsors if specified
requirements are met.
This bill would, on and after July 1, 2010, require a health
insurance issuer that receives a written request for a written report
of claim information from a plan, plan sponsor, or plan
administrator with respect to a group health plan issued by the
issuer, to provide that report to the requesting party no later than
30 days after receipt of the request. The bill would require the
report to be provided in a specified manner and to include specified
information. The bill would prohibit the health insurance issuer from
disclosing any information protected under federal or state law, and
would also prohibit the issuer from disclosing protected health
information to the plan sponsor unless an authorized representative
of the plan sponsor makes a specified certification. The bill would
make a health insurance issuer that fails to comply with these
requirements subject to administrative penalties. The bill would
define various terms and enact related provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Article 12 (commencing with Section 1399.850) is added
to Chapter 2.2 of Division 2 of the Health and Safety Code, to read:
Article 12. Reporting of Claims Information
1399.850. (a) For purposes of this article, except as provided in
subdivision (b), the following terms have the following meanings:
(1) "Employer" has the same meaning as that term is defined in
Section 1002(5) of Title 29 of the United States Code.
(2) "Governmental entity" means a state agency or political
subdivision of the state.
(3) "Group health plan" has the same meaning as that term is
defined in Section 160.103 of Title 45 of the Code of Federal
Regulations, except that the term does not include disability income
insurance or long-term care insurance.
(4) "Health insurance issuer" has the same meaning as that term is
defined in Section 160.103 of Title 45 of the Code of Federal
Regulations.
(5) "Plan" means an employee welfare benefit plan, as defined in
Section 1002(1) of Title 29 of the United States Code.
(6) "Plan administrator" means an administrator, as defined in
Section 1002(16)(A) of Title 29 of the United States Code.
(7) "Plan sponsor" has the same meaning as that term is defined in
Section 1002(16)(B) of Title 29 of the United States Code.
(8) "Political subdivision" means a county, municipality, school
district, special-purpose district, or other subdivision of state
government that has jurisdiction limited to a geographic portion of
the state.
(9) "Protected health information" has the same meaning as that
term is defined in Section 160.103 of Title 45 of the Code of Federal
Regulations.
(b) A reference to a federal statute or regulation under
subdivision (a) refers to that statute or regulation as it existed on
January 1, 2009, except that the director may, by rule, in
consultation with the Insurance Commissioner, adopt a definition
based on a later amended, enacted, or adopted federal statute or
regulation if the director determines that use of the later amended,
enacted, or adopted statute or regulation is consistent with the
purposes of this article and promotes regulatory consistency.
1399.851. (a) This article shall apply to a governmental entity
that enters into a contract with a health insurance issuer that
results in the health insurance issuer delivering, issuing for
delivery, or renewing a group health plan.
(b) For purposes of this chapter, a health insurance issuer shall
treat a governmental entity described in subdivision (a) as a plan
sponsor or plan administrator.
(c) A report of claim information provided under this section to a
governmental entity is confidential and exempt from public
disclosure under Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1 of the Government Code.
1399.852. (a) A health insurance issuer that receives a written
request for a written report of claim information from a plan, plan
sponsor, or plan administrator with respect to a group health plan
issued by the issuer shall provide that report, consistent with the
requirements of this section, to the requesting party no later than
30 days after receipt of the request. The health insurance issuer
shall not be required to provide a report under this subdivision
regarding a particular employer or group health plan more than twice
in a 12-month period.
(b) A health insurance issuer shall provide the report of claim
information required pursuant to subdivision (a) by one of the
following means:
(1) In a written report.
(2) Through an electronic file transmitted by secure electronic
mail or a file transfer protocol site.
(3) By making the required information available through a secure
Internet Web site or Web portal accessible by the requesting plan,
plan sponsor, or plan administrator.
(c) A report of claim information provided under this section
shall contain all information available to the health insurance
issuer that is responsive to the request for the 36-month period
preceding the date of the report or the entire period of coverage,
whichever period is shorter, except as provided in paragraphs (5) and
(6). Except as provided in subdivisions (d) and (e), the report
required by this section shall include all of the following
information:
(1) Aggregate paid claims experience by month, including, but not
limited to, claims experience for medical, dental, and pharmacy
benefits, as applicable.
(2) Total premiums paid by month.
(3) The total number of covered employees on a monthly basis by
coverage tier, including whether the coverage was for one of the
following:
(A) An employee only.
(B) An employee with dependents only.
(C) An employee with a spouse only.
(D) An employee with a spouse and dependents.
(4) The total dollar amount of claims pending as of the date of
the report.
(5) A separate description and individual claims report for any
individual whose total paid claims exceed fifteen thousand dollars
($15,000) during the 12-month period preceding the date of the
report. This report shall include all of the following information
related to the claims for that individual:
(A) A unique identifying number, characteristic, or code for the
individual.
(B) The amounts paid during the 12-month period.
(C) The dates on which health care services were provided during
the 12-month period.
(D) The applicable procedure codes and diagnosis codes.
(6) For claims that are not part of the report described by
paragraphs (1) to (5), inclusive, a statement describing
precertification requests for hospital stays of five days or longer
that were made during the 30-day period preceding the date of the
report.
(d) A health insurance issuer shall not disclose any information
in the report required under this section that the health insurance
issuer is prohibited from disclosing under another state or federal
law that imposes more stringent privacy restrictions than those
imposed under federal law under the Health Insurance Portability and
Accountability Act of 1996 (Public Law 104-191). In order to withhold
information in accordance with this subdivision, the health
insurance issuer shall do both of the following:
(1) Notify the plan, plan sponsor, or plan administrator
requesting the report that information is being withheld.
(2) Provide to the plan, plan sponsor, or plan administrator
requesting the report a list of categories of claim information that
the health insurance issuer has determined are subject to the more
stringent privacy restrictions under another state or federal law.
(e) A plan sponsor shall not receive protected health information
under paragraph (5) or (6) of subdivision (c) unless an appropriately
authorized representative of the plan sponsor makes a certification
to the health insurance issuer that is substantially similar to the
following:
"I hereby certify that the plan documents comply with the
requirements of 45 C.F.R. Section 164.504(f)(2) and that the plan
sponsor will safeguard and limit the use and disclosure of protected
health information that the plan sponsor may receive from the group
health plan to perform plan administration functions."
(f) If a health insurance issuer receives a request under
subdivision (a) after the date that coverage under the applicable
group health plan has terminated, the report required under
subdivision (a) shall contain all information available to the health
insurance issuer that is responsive to the request for the period
described in subdivision (c) preceding the date of termination of
coverage or for the entire policy period, whichever period is
shorter. The report shall include the information described in
paragraphs (1) to (6), inclusive, of subdivision (c), but it shall
not include any protected health information required under paragraph
(5) or (6) of subdivision (c) unless a certification has been
provided in accordance with subdivision (e).
(g) In order to be entitled to receive the report described in
this section, a plan, plan sponsor, or plan administrator shall
request that report on or before the second anniversary of the date
of termination of coverage under a group health plan issued by the
health insurance issuer.
1399.853. (a) No later than 10 days after receiving the report
described in Section 1399.852, a plan, plan sponsor, or plan
administrator may make a written request to the health insurance
issuer for additional information regarding specified individuals in
accordance with this section.
(b) With respect to a request for additional information
concerning specified individuals for whom claims information was
provided under paragraph (5) of subdivision (c) of Section 1399.852,
the health insurance issuer shall provide additional information on
the prognosis or recovery of the individual, if available, and for
individuals in active case management, the most recent case
management information relating to the claims for that individual,
including any future expected costs and treatment plans.
(c) The health insurance issuer shall respond to a request for
additional information under this section no later than 15 days after
the date of the request unless the requesting plan, plan sponsor, or
plan administrator agrees to a request for additional time.
(d) The health insurance issuer shall not provide the information
described in this section unless a certification has been provided in
accordance with subdivision (e) of Section 1399.852.
1399.854. A health insurance issuer that releases information,
including, but not limited to, protected health information, in
accordance with this article shall not be in violation of a standard
of care. In addition, the health insurance issuer shall not be held
liable for civil damages resulting from, or subject to criminal
prosecution for, releasing that information in accordance with this
article.
1399.855. For purposes of this article, Sections 1374.8 and 1390
shall not apply.
1399.856. A health insurance issuer that fails to comply with
this article is subject to administrative penalties.
1399.857. This article applies only to a request for a written
report of claim information made on or after July 1, 2010.
SEC. 2. Chapter 7.5 (commencing with Section 10650) is added to
Part 2 of Division 2 of the Insurance Code, to read:
CHAPTER 7.5. REPORTING OF CLAIMS INFORMATION
10650. (a) For purposes of this chapter, except as provided in
subdivision (b), the following terms have the following meanings:
(1) "Employer" has the same meaning as that term is defined in
Section 1002(5) of Title 29 of the United States Code.
(2) "Governmental entity" means a state agency or political
subdivision of the state.
(3) "Group health plan" has the same meaning as that term is
defined in Section 160.103 of Title 45 of the Code of Federal
Regulations, except that the term does not include disability income
insurance or long-term care insurance.
(4) "Health insurance issuer" has the same meaning as that term is
defined in Section 160.103 of Title 45 of the Code of Federal
Regulations.
(5) "Plan" means an employee welfare benefit plan, as defined in
Section 1002(1) of Title 29 of the United States Code.
(6) "Plan administrator" means an administrator, as defined in
Section 1002(16)(A) of Title 29 of the United States Code.
(7) "Plan sponsor" has the same meaning as that term is defined in
Section 1002(16)(B) of Title 29 of the United States Code.
(8) "Political subdivision" means a county, municipality, school
district, special-purpose district, or other subdivision of state
government that has jurisdiction limited to a geographic portion of
the state.
(9) "Protected health information" has the same meaning as that
term is defined in Section 160.103 of Title 45 of the Code of Federal
Regulations.
(b) A reference to a federal statute or regulation under
subdivision (a) refers to that statute or regulation as it existed on
January 1, 2009, except that the commissioner may, by rule, in
consultation with the Director of Managed Health Care, adopt a
definition based on a later amended, enacted, or adopted federal
statute or regulation if the commissioner determines that use of the
later amended, enacted, or adopted statute or regulation is
consistent with the purposes of this chapter and promotes regulatory
consistency.
10651. (a) This chapter shall apply to a governmental entity that
enters into a contract with a health insurance issuer that results
in the health insurance issuer delivering, issuing for delivery, or
renewing a group health plan.
(b) For purposes of this chapter, a health insurance issuer shall
treat a governmental entity described in subdivision (a) as a plan
sponsor or plan administrator.
(c) A report of claim information provided under this section to a
governmental entity is confidential and exempt from public
disclosure under Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1 of the Government Code.
10652. (a) A health insurance issuer that receives a written
request for a written report of claim information from a plan, plan
sponsor, or plan administrator with respect to a group health plan
issued by the issuer shall provide that report, consistent with the
requirements of this section, to the requesting party no later than
30 days after receipt of the request. The health insurance issuer
shall not be required to provide a report under this subdivision
regarding a particular employer or group health plan more than twice
in a 12-month period.
(b) A health insurance issuer shall provide the report of claim
information required pursuant to subdivision (a) by one of the
following means:
(1) In a written report.
(2) Through an electronic file transmitted by secure electronic
mail or a file transfer protocol site.
(3) By making the required information available through a secure
Internet Web site or Web portal accessible by the requesting plan,
plan sponsor, or plan administrator.
(c) A report of claim information provided under this section
shall contain all information available to the health insurance
issuer that is responsive to the request for the 36-month period
preceding the date of the report or the entire period of coverage,
whichever period is shorter, except as provided in paragraphs (5) and
(6). Except as provided in subdivisions (d) and (e), the report
required by this section shall include all of the following
information:
(1) Aggregate paid claims experience by month, including, but not
limited to, claims experience for medical, dental, and pharmacy
benefits, as applicable.
(2) Total premiums paid by month.
(3) The total number of covered employees on a monthly basis by
coverage tier, including whether the coverage was for one of the
following:
(A) An employee only.
(B) An employee with dependents only.
(C) An employee with a spouse only.
(D) An employee with a spouse and dependents.
(4) The total dollar amount of claims pending as of the date of
the report.
(5) A separate description and individual claims report for any
individual whose total paid claims exceed fifteen thousand dollars
($15,000) during the 12-month period preceding the date of the
report. This report shall include all of the following information
related to the claims for that individual:
(A) A unique identifying number, characteristic, or code for the
individual.
(B) The amounts paid during the 12-month period.
(C) The dates on which health care services were provided during
the 12-month period.
(D) The applicable procedure codes and diagnosis codes.
(6) For claims that are not part of the report described by
paragraphs (1) to (5), inclusive, a statement describing
precertification requests for hospital stays of five days or longer
that were made during the 30-day period preceding the date of the
report.
(d) A health insurance issuer shall not disclose any information
in the report required under this section that the health insurance
issuer is prohibited from disclosing under another state or federal
law that imposes more stringent privacy restrictions than those
imposed under federal law under the Health Insurance Portability and
Accountability Act of 1996 (Public Law 104-191). In order to withhold
information in accordance with this subdivision, the health
insurance issuer shall do both of the following:
(1) Notify the plan, plan sponsor, or plan administrator
requesting the report that information is being withheld.
(2) Provide to the plan, plan sponsor, or plan administrator
requesting the report a list of categories of claim information that
the health insurance issuer has determined are subject to the more
stringent privacy restrictions under another state or federal law.
(e) A plan sponsor shall not receive protected health information
under paragraph (5) or (6) of subdivision (c) unless an appropriately
authorized representative of the plan sponsor makes a certification
to the health insurance issuer that is substantially similar to the
following:
"I hereby certify that the plan documents comply with the
requirements of 45 C.F.R. Section 164.504(f)(2) and that the plan
sponsor will safeguard and limit the use and disclosure of protected
health information that the plan sponsor may receive from the group
health plan to perform plan administration functions."
(f) If a health insurance issuer receives a request under
subdivision (a) after the date that coverage under the applicable
group health plan has terminated, the report required under
subdivision (a) shall contain all information available to the health
insurance issuer that is responsive to the request for the period
described in subdivision (c) preceding the date of termination of
coverage or for the entire policy period, whichever period is
shorter. The report shall include the information described in
paragraphs (1) to (6), inclusive, of subdivision (c), but it shall
not include any protected health information required under paragraph
(5) or (6) of subdivision (c) unless a certification has been
provided in accordance with subdivision (e).
(g) In order to be entitled to receive the report described in
this section, a plan, plan sponsor, or plan administrator shall
request that report on or before the second anniversary of the date
of termination of coverage under a group health plan issued by the
health insurance issuer.
10653. (a) No later than 10 days after receiving the report
described in Section 10652, a plan, plan sponsor, or plan
administrator may make a written request to the health insurance
issuer for additional information regarding specified individuals in
accordance with this section.
(b) With respect to a request for additional information
concerning specified individuals for whom claims information was
provided under paragraph (5) of subdivision (c) of Section 10652, the
health insurance issuer shall provide additional information on the
prognosis or recovery of the individual, if available, and for
individuals in active case management, the most recent case
management information relating to the claims for that individual,
including any future expected costs and treatment plans.
(c) The health insurance issuer shall respond to a request for
additional information under this section no later than 15 days after
the date of the request unless the requesting plan, plan sponsor, or
plan administrator agrees to a request for additional time.
(d) The health insurance issuer shall not provide the information
described in this section unless a certification has been provided in
accordance with subdivision (e) of Section 10652.
10654. A health insurance issuer that releases information,
including, but not limited to, protected health information, in
accordance with this chapter shall not be in violation of a standard
of care. In addition, the health insurance issuer shall not be held
liable for civil damages resulting from, or subject to criminal
prosecution for, releasing that information.
10655. For purposes of this chapter, Section 791.27 shall not
apply.
10656. A health insurance issuer that fails to comply with this
chapter is subject to administrative penalties.
10657. This chapter applies only to a request for a written
report of claim information made on or after July 1, 2010.