BILL ANALYSIS
AB 1825
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CORRECTED - 10/04/2010 Changes per consultant.
CONCURRENCE IN SENATE AMENDMENTS
AB 1825 (De La Torre)
As Amended August 20, 2010
Majority vote
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|ASSEMBLY: |48-25|(June 2, 2010) |SENATE: |22-11|(August 25, |
| | | | | |2010) |
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Original Committee Reference: HEALTH
SUMMARY : Requires every individual or group health insurance
policy, as specified, issued, amended, or renewed on or after
July 1, 2011, and prior to January 1, 2014, to provide coverage
for maternity services, as defined and after January 1, 2014, to
provide coverage for maternity services consistent with the
federal Patient Protection and Affordable Care Act (PPACA).
The Senate amendments :
1)Require a group or individual health insurance policy that is
issued, amended, or renewed on or after July 1, 2011, and on
or before December 31, 2013, to provide coverage for maternity
services, as defined. Require the group or individual health
insurance policy to also comply with any other maternity
coverage requirement imposed under federal law.
2)Require a group or individual health insurance policy, to the
extent required under federal law, on or after January 1,
2014, to cover maternity services consistent with the rules
and regulations issued by the United States Secretary of
Health and Human Services (HHS) pursuant to PPACA.
3)Permit, to the extent permitted under federal law, an
individual health insurance policy that is issued, amended, or
renewed on or after July 1, 2011, and that applies a
preexisting condition provisions, a waiting or affiliation
period, or a waivered condition provision to include an
exclusionary period of up to 12 months for maternity services,
except for those services required to be covered under federal
law and those services covered under the policy prior to July
1, 2011.
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4)Require an individual health insurer to credit the time an
individual was covered under creditable coverage against the
12-month exclusionary period, provided that the individual
becomes eligible for coverage under the succeeding insurance
policy within 62 days of termination of prior coverage,
exclusive of any waiting or affiliation period, and applies
for coverage under the succeeding insurance policy within the
applicable enrollment period.
5)Require a individual health insurer that offers a policy with
an exclusionary period for maternity services as described in
3) and 4) above to make available, at the tie of solicitation
and as part of the sales material for the policy, the
following notice in 12-point type:
a) IMPORTANT NOTICE: PLEASE BE AWARE THAT YOU MAY BE
ENROLLING IN A POLICY THAT DOES NOT COVER OR PROVIDE
BENEFITS FOR MATERNITY CARE FOR UP TO TWELVE MONTHS
IMMEDIATELY FOLLOWING ENROLLMENT. NO BENEFITS WILL BE PAID
FOR MATERNITY SERVICES DURING THIS PERIOD, AS DESCRIBED IN
THE CERTIFICATE OF INSURANCE.
6)Prohibit 3), 4), and 5) above from applying to specialized
health insurance, Medicare supplement insurance, short-term
limited duration health insurance, CHAMPUS-supplement
insurance, or TRI-CARE supplement insurance, or to a hospital
indemnity, accident-only, or specified disease insurance.
7)Require 3), 4), 5), and 6) above to remain in effect only
until January 1, 2014, and as of that date is repealed, unless
a later enacted statute, that is enacted before January 1,
2014, deletes or extends that date.
EXISTING LAW :
1)Provides for the regulation of health plans by the Department
of Managed Health Care (DMHC) under the Knox-Keene Health Care
Service Plan Act of 1975 (Knox-Keene) and for the regulation
of health insurers by the California Department of Insurance
under the Insurance Code.
2)Requires health plans under Knox-Keene to cover a number of
basic health care services and permits DMHC to define the
scope of the services and to exempt plans from the requirement
for good cause.
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3)Provides, under Knox-Keene, that "basic health care services"
include: a) physician services, including consultation and
referral; b) hospital inpatient services and ambulatory care
services; c) diagnostic laboratory and diagnostic and
therapeutic radiological services; d) home health
services; e) preventive health services; f) emergency health
care services, including ambulance and ambulance transport
services and out-of-area coverage; and, g) hospice
care.
4)Provides, under Knox-Keene, that health plans must provide all
medically necessary basic health care services, including
maternity services necessary to prevent serious deterioration
of the health of the enrollee or the enrollee's fetus, and
preventive health care services, specifically including
prenatal care.
5)Prohibits health plans and health insurers from issuing
contracts and policies that contain a copayment or deductible
for inpatient hospital or ambulatory care maternity services
that exceed the most common amount charged for the same type
of care and services provided for other covered medical
conditions.
6)Prohibits health plans and health insurers providing maternity
benefits for a person covered continuously from conception
from attaching any exclusions, reductions, or limitations to
coverage for involuntary complications of pregnancy unless
those provisions apply to all of the benefits paid by the plan
or insurer.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version passed by the Senate.
FISCAL EFFECT : According to the Senate Appropriations
Committee, this bill will result in $75,000 to the Insurance
Fund in fiscal year (FY) 2010-2011, $145,000 in FY 2011-2012 and
no costs in FY 2012-2013 for the California Department of
Insurance to review insurance policies. The Senate
Appropriations Committee analysis also states that this bill
will result in cost pressure to provide care for newly uninsured
persons in the amount of $47,000 to $467,000 in FY 2010-2011,
$93,000 to $934,000 in FY 2011-2012, and $93,000 to $934,000 in
FY 2012-2013.
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COMMENTS : The author asserts that one of the latest trends in
the individual market is for insurers to exclude maternity care
from their basic plan benefits to sell cheaper products to
target populations. As more employers are dropping employee
health coverage, the author contends that insurance companies
are increasingly targeting the young, uninsured population of
the market with non-maternity products, even though 25% of these
individuals are women of childbearing age. The author argues
that these types of non-maternity products delay and restrict
access to prenatal care, which can lead to serious health
complications for both the mother and the baby, and force more
women into state-funded programs, such as Medi-Cal or Access for
Infants and Mothers.
The recently passed PPACA would require all health plans and
insurers to provide maternity coverage commencing January 1,
2014, as part of an essential health benefits package. However,
the Secretary of HHS has yet to define the scope of benefits for
maternity care.
Analysis Prepared by : Tanya Robinson-Taylor / HEALTH / (916)
319-2097
FN: 0006683