BILL NUMBER: AB 2396 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 28, 2010
AMENDED IN SENATE JUNE 21, 2010
AMENDED IN ASSEMBLY MAY 12, 2010
AMENDED IN ASSEMBLY APRIL 8, 2010
INTRODUCED BY Assembly Member Solorio
FEBRUARY 19, 2010
An act to amend Section 11751.5 of the Insurance Code, relating to
workers' compensation insurance.
LEGISLATIVE COUNSEL'S DIGEST
AB 2396, as amended, Solorio. Workers' compensation insurance:
rating organizations: statistical agent.
Existing law requires the Insurance Commissioner to designate a
licensed rating organization, as defined, as his or her statistical
agent to gather and compile workers' compensation insurers' loss and
expense experience statistics, and all licensed rating organizations
are required to report loss and expense experiences of their member
workers' compensation insurers to the statistical agent. Subject to
reasonable rules approved by the commissioner, the statistical agent
is required to make available those compiled experience statistics to
all licensed rating organizations. The statistical agent is
authorized to make a reasonable charge to other ratings organizations
for the expense incurred by it in combining, tabulating, and
compiling the experience of all workers' compensation insurers.
This bill would require that all materials and documents prepared
or used by the designated statistical agent for the purpose of
developing pure premium rates, except as specified, be made available
to the public and that copies of these materials and documents be
made available to the public for inspection at no charge. The bill
would provide that members of the public may purchase these
ratemaking related materials and documents at actual cost, as
specified.
This bill would require a statistical agent to conduct public
meetings, as provided, would specify records of the statistical agent
that are public, and would specify information prohibited from being
considered a public record.
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. Section 11751.5 of the Insurance Code is amended to
read:
11751.5. (a) The commissioner, after notice and hearing, may
promulgate reasonable rules and statistical plans, which may be
modified from time to time and which shall be used thereafter in the
recording and reporting by insurers of their loss and expense
experience in order that the experiences of all insurers may be made
available in such form and detail as may be necessary to aid the
commissioner in administering the provisions of Article 2 (commencing
with Section 11730).
(b) The commissioner shall designate a rating organization
licensed under this article as his or her statistical agent to gather
and compile such experience statistics and all licensed rating
organizations shall report the experience of their members to such
designated rating organization. Subject to reasonable rules approved
by the commissioner, such designated rating organization shall make
such experience statistics, when compiled, available to all licensed
rating organizations and may make a reasonable charge to other rating
organizations for the expense incurred by it in combining,
tabulating and compiling the experience of all workers' compensation
insurers.
(c) All materials and documents prepared or used by the designated
statistical agent for the purpose of developing pure premium rates,
other than proprietary materials and documents owned or licensed by
third parties, shall be available to the public and copies of these
materials and documents shall be made available to the public for
inspection at no charge. Members of the public may purchase these
ratemaking related materials and documents from the designated
statistical agent at actual cost.
(c) (1) The statistical agent shall conduct public meetings with
regard to all issues involving pure premium rates, classifications,
rating plans, rating systems, manual rules, and policy and
endorsement forms that are properly brought before it in any of its
committees. This shall apply to meetings conducted in person and via
teleconference. Attendance at telephonically conducted meetings by
members of the public shall be made available by the publication by
the organization in its meeting notices as set forth below of a
call-in number and passcode that members of the public may use to
participate in the meeting.
(2) As used in this section, "meeting" includes any congregation
of a majority of the members of any committee that handles the issues
set forth in paragraph (1), as applicable, at the same time to hear,
discuss, or deliberate upon any of those issues. Notwithstanding the
foregoing, a meeting shall not include any of the following:
(A) Individual contacts or conversations between a member of any
committee and any other person, including, but not limited to, any
employee or official of the organization that does not violate this
subdivision.
(B) The attendance of a majority of the members of any committee
at an industry conference or other gathering organized by a person or
organization other than the statistical agent, provided that a
majority of the members do not discuss among themselves any item that
is within the responsibility of the statistical agent as set forth
in this article.
(C) The attendance of a majority of the members of any committee
at a purely social or ceremonial occasion, provided that a majority
of the members do not discuss among themselves any item that is
within the responsibility of the statistical agent as set forth in
this article.
(3) (A) A majority of the members of any committee of the
statistical agent shall not, outside a meeting authorized by this
article, use a series of communications of any kind, directly or
through intermediaries, to discuss, deliberate, or take action on any
item of business that is within the responsibility of the
statistical agent as set forth in this article.
(B) Subparagraph (A) shall not be construed as preventing any
employee or officer of the statistical agent from engaging in
separate conversations or communications outside of a meeting
authorized by this article with members of any of its committees in
order to answer questions or provide information regarding matters
within the responsibility of the statistical agent, if that person
does not communicate to members of any of the committees of the board
of governors the comments or position of any other member or members
of the committees.
(d) All meetings of the statistical agent authorized under this
article shall comply with the protections and prohibitions contained
in Section 202 of the Americans with Disabilities Act of 1990 (42
U.S.C. Sec. 12132), and the federal rules and regulations adopted in
implementation of that act.
(e) (1) The statistical agent shall provide notice of its meetings
that are open and public pursuant to subdivision (c). This notice
and an agenda of items to be discussed shall be provided at least 10
days in advance of the meeting via the statistical agent's Internet
Web site. In addition, members of the public may request notice by
regular mail or by e-mail by making a written request to the
statistical agent for notice of meetings that are open and public
pursuant to subdivision (c).
(2) Notice may be waived or the 10-day period modified, with
respect to any particular meeting, by the statistical agent's
governing committee or board upon a request submitted to the
commissioner stating the need for a modified notice and exigent
circumstances requiring waiver of the notice requirement, at least 24
hours in advance of the meeting time set. The approval of the
commissioner shall be deemed granted if a written denial of the
request for waiver or modification of the notice period is not
received at least four hours prior to the commencement of the meeting
to be conducted under the modified notice.
(3) Notice of a meeting that does not meet the 10-day notice
requirement under this subdivision shall be posted on the statistical
agent's Internet Web site and provided by e-mail to members of the
public who have made a written request for e-mail notice to the
statistical agent of meetings that are open and public pursuant to
subdivision (c). A summary agenda shall be included in each such
notice, but members of any committee may bring additional items of
business to any such meeting.
(f) At any meeting where notice is required pursuant to this
section, the statistical agent shall reserve time for public comment
on the issues addressed at the meeting.
(g) Nothing in this section shall be construed to prohibit the
committees of the statistical agent from holding a closed meeting or
a closed session of an open and public meeting to discuss any of the
following subjects:
(1) Financial, operational, or personnel information or matters
related to the statistical agent.
(2) Nonpublic financial, operational, or personnel information or
matters of member insurers of the statistical agent.
(3) Nonpublic information received from regulators regarding the
statistical agent or members of the statistical agent.
(4) Statutory interpretations and other advice received from legal
counsel to the statistical agent, whether in connection with
litigation or otherwise.
(5) Appointment, employment, evaluation of performance, or
dismissal of any employee or vendor that provides products and
services in connection with the operations of the statistical agent.
(6) Deliberations concerning the purchase, sale, exchange, or
lease of real or personal property, including investment property.
(7) Matters posing a threat of criminal or terrorist activity
against the statistical agent, its personnel, or its property.
(8) Legal, legislative, or regulatory matters of the statistical
agent, whether potential, pending, or actual, that are unrelated to
the issues in paragraph (1) of subdivision (c).
(9) Disputes and purported disputes with or involving members of
the statistical agent.
(10) Any other matters as permitted by order or regulation of the
commissioner.
(h) With respect to any closed meeting or session held as
permitted by subdivision (g), the statistical agent shall do both of
the following:
(1) Disclose, prior to the closed meeting or the closed session,
the general nature of the item or items to be discussed in the closed
session. The disclosure may take the form of a reference to the item
or items as they are listed by number or letter on the agenda. In
the closed session, the committee may consider only those matters
covered in its disclosure. After any closed session, the committee
shall reconvene in open session prior to adjournment and shall make
any reports, provide any documentation, or make any other disclosures
that may be required consistent with this article. The announcements
required to be made in open session pursuant to this subdivision may
be made at the location announced in the agenda for the closed
session, as long as the public is allowed to be present at that
location for the purpose of hearing the announcement.
(2) Provide reports to the commissioner identifying the matters
covered in each such closed meeting or session and the provisions of
subdivision (g) pursuant to which the subject was discussed.
(i) Nothing in this section shall require or authorize the
disclosure of names or other information that would constitute an
invasion of privacy or otherwise unnecessarily divulge the particular
facts concerning the closed session or the disclosure of which is
prohibited by state or federal law.
(j) The commissioner or his or her designated representative shall
be permitted to attend all meetings of the statistical agent,
specifically including closed meetings and sessions. Any information
discussed in closed meetings or sessions shall be treated by the
commissioner and his or her designated representatives as
confidential pursuant to the provisions of Section 12919.
(k) Records of a statistical agent that shall be considered public
records and that shall be made available to the public for purchase
for the direct costs of duplication include, but are not limited to,
all of the following:
(1) Information releases, including bulletins, general notices,
all committee meeting agendas, and minutes, except for items
expressly excluded by statute, in which case the item shall be
generally identified, and the reason for the exclusion expressed in
writing.
(2) Information or materials provided to the department as part of
or in support of a rating filing.
(3) Actuarial assumptions and calculations made in the course of
ratemaking.
(4) Aggregate data, comprised of data from multiple carriers,
which is used in the ratemaking process.
(5) Aggregate data provided to statistical agent members or
others, including classification experience data and aggregate
payroll data.
(6) Material made available free on the rating statistical agent's
Internet Web site that exists in other forms.
(7) Manuals, plans, and classification information, including
codes, materials, books, manuals, or pamphlets, that outline or
delineate the rules or regulations of the workers' compensation
system.
(8) Studies or reports created as a result of statute or request
of the department, the Legislature, or any other governmental body,
except to the extent that the department designates a requested
report or study as nonpublic.
(9) Materials used in classes or training for licensees of the
department or the public.
(l) All of the following information, if applicable based on the
facts of the particular case, in the possession of a statistical
agent shall not be considered a public record:
(1) Aggregate data from an individual insurer.
(2) Claims data relating to individual claims.
(3) Payroll data relating to an individual employer.
(4) Data relating to active investigations by the statistical
agent of a member or members initiated by the statistical agent, the
commissioner, or other law enforcement agency.