BILL NUMBER: AB 1759	AMENDED
	BILL TEXT

	AMENDED IN SENATE  JUNE 24, 2010
	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
 during specified tim   e periods; however
changes to the premium rates or applicable copayments or coinsurances
or deductibles are allowed when, among other things, the change is
authorized or required in the group contract  .
   This bill would  prohibit a health care service plan or
health insurer from using a change in enrollment as the basis for a
premium rate change during the length of the group contract 
 instead allow a change to premium rates or applicable
copayments or coinsurance or deductibles when required by law  .
The bill would  exempt health care service plan contracts and
health insurance policies issued to a small employer from these
provisions and would also  provide that a violation of 
that prohibition   those provisions  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
  a change in applicable copayments, coinsurance, or
deductibles is required by law  .
   (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
 to a change in applicable copayments, coinsurance, or
deductibles  . 
   (c) This section shall not apply to a health care service plan
contract issued to a small employer, as defined in Section 1357.
 
   (c) A health care service plan shall not use a change in
enrollment as the basis for a premium rate change during the length
of the contract. 
    (d)    A violation of this  subdivision
  section  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   a change in applicable copayments, coinsurance,
or deductibles is required by law  .
   (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  to a change in applicable copayments,
coinsurance, or deductibles  . 
   (c) A health insurer shall not use a change in enrollment as the
basis for a premium rate change during the length of the contract.
 
   (c) This section shall not apply to a health insurance policy or
contract issued to a small employer, as defined in Section 10700.