BILL NUMBER: AB 1759	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 20, 2010
	AMENDED IN ASSEMBLY  MARCH 9, 2010

INTRODUCED BY   Assembly Member Blumenfield
    (   Coauthors:   Assembly Members 
 Huffman  and Yamada   ) 
    (   Coauthor:   Senator   Pavley
  ) 

                        FEBRUARY 8, 2010

   An act to amend Section 1374.20 of the Health and Safety Code, and
to amend Section 10199.48 of the Insurance Code, relating to health
care coverage.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1759, as amended, Blumenfield. Health care coverage: premium
rates.
   Existing law, the Knox-Keene Health Care Service Plan Act of 1975
(Knox-Keene Act), provides for the licensure and regulation of health
care service plans by the Department of Managed Health Care, and
makes a willful violation of its provisions a crime. Existing law
provides for the regulation of health insurers by the Department of
Insurance. Existing law prohibits, except as specified, a health care
service plan or a health insurer from changing its premium rates or
applicable copayments or coinsurances or deductibles for group health
care service plan contracts or group health insurance policies after
the group contractholder or group policyholder has delivered written
acceptance of the contract or policy, after the start of the open
enrollment period, or after receipt of the premium payment for the
first month of coverage.
   This bill would prohibit a health care service plan or health
insurer from using a change in  demographics or 
enrollment as the basis for a premium rate change during the length
of the  group  contract. The bill would provide that a
violation of that prohibition would not be subject to the crime
provision that applies to the Knox-Keene Act.
   Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.


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

  SECTION 1.  Section 1374.20 of the Health and Safety Code is
amended to read:
   1374.20.  (a) No group health care service plan shall change the
premium rates or applicable copayments or coinsurances or deductibles
for the length of the contract, except as specified in subdivision
(b), during any of the following time periods:
   (1) After the group contractholder has delivered written notice of
acceptance of the contract.
   (2) After the start of the employer's annual open enrollment
period.
   (3) After the receipt of payment of the premium for the first
month of coverage in accordance with the contract effective date.
   (b) Changes to the premium rates or applicable copayments or
coinsurances or deductibles of a contract shall, subject to the plan
meeting the requirements of this article, be allowed in any of the
following circumstances:
   (1) When authorized or required in the group contract.
   (2) When the contract was agreed to under a preliminary agreement
that states that it is subject to execution of a definitive
agreement.
   (3) When the plan and contractholder mutually agree in writing.
   (c) A health care service plan shall not use a change in 
demographics or  enrollment as the basis for a premium rate
change during the length of the contract. A violation of this
subdivision shall not be subject to Section 1390.
  SEC. 2.  Section 10199.48 of the Insurance Code is amended to read:

   10199.48.  (a) No health insurer shall, with regard to a group
contract, change the premium rates or applicable copayments or
coinsurances or deductibles for the length of the contract, except as
specified in subdivision (b), during any of the following time
periods:
   (1) After the group policyholder or group contractholder has
delivered written notice of acceptance of the contract or policy.
   (2) After the start of the employer's annual open enrollment
period.
   (3) After the receipt of payment of the premium for the first
month of coverage in accordance with the contract or policy effective
date.
   (b) Changes to the premium rates or applicable copayments or
coinsurances or deductibles of a contract or policy shall, subject to
the insurer meeting the requirements of this chapter, be allowed in
any of the following circumstances:
   (1) When authorized or required in the group contract or policy.
   (2) When the contract or policy was agreed to under a preliminary
agreement that states that it is subject to execution of a definitive
agreement.
   (3) When the insurer and the policyholder or contractholder
mutually agree in writing.
   (c) A health insurer shall not use a change in 
demographics or  enrollment as the basis for a premium rate
change during the length of the contract.