BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
1169 (Lowenthal)
Hearing Date: 5/27/2010 Amended: 4/26/2010
Consultant: Katie Johnson Policy Vote: Health 7-2
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BILL SUMMARY: SB 1169 would require health care service plans
and health insurers to assign a tracking number to a claim or a
provider request for authorization, provide acknowledgment of
its receipt, and use the tracking number in subsequent
communications. The bill would also clarify that any form of
treatment or benefit limitation for mental health care services
be applied under the same terms as other benefits under the plan
or policy.
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Fiscal Impact (in thousands)
Major Provisions 2010-11 2011-12 2012-13 Fund
DMHC regulations up to $130 up to
$170ongoingSpecial*
likely minor
*Managed Care Fund
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STAFF COMMENTS: SUSPENSE FILE. AS PROPOSED TO BE AMENDED.
Mental Health Services
Existing law requires that the terms and conditions applied to
mental health benefits be applied equally to all benefits under
the health plan or policy including maximum lifetime benefits,
copayments and coinsurance, and individual and family
deductibles. Although existing law currently provides for the
diagnosis and treatment of severe mental illness and severe
emotional disturbances of a child under the same terms and
conditions applied to other medical conditions, this bill would
clarify the requirement further. This bill would clarify that
any form of treatment or benefit limitation for mental health
care services would be applied under the same terms as other
benefits under the health plan or policy. Treatment or benefit
limitations or actions include maximum lifetime benefits,
copayments and coinsurance, and individual and family
deductibles.
If the Department of Managed Health Care (DMHC) needed to update
the existing regulations on mental health parity, staff could
cost up to $130,000 in FY 2010-2011 and up to $170,000 in FY
2011-2012 in special funds. Ongoing costs would likely be minor.
Any fiscal impact on the California Department of Insurance
(CDI) would be minor and absorbable.
Tracking Claims and Treatment Authorization Requests
This bill would require health care service plans and health
insurers, collectively carriers, to assign a tracking number to
claims and provider requests for treatment
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SB 1169 (Lowenthal)
authorization, provide acknowledgment of receipt to both
providers and enrollees, and use the tracking number in
subsequent communications. This bill would also require that, if
a claim is contested on the basis that the carrier has not
received all necessary information to complete it, carriers
would be required within three working days of receipt of any of
the additional information to provide acknowledgment of receipt.
This bill would provide that all communications of
acknowledgment of receipt of claims, requests for treatment
authorization, and additional claims information be communicated
via email unless the claimant or provider requests that receipts
be sent in writing.
Existing law provides that claims be processed within 30 working
days for insurers and health plans and within 45 working days if
the health plan is a managed care organization and that
treatment authorizations be approved in a timely fashion not to
exceed five business days unless the request is retroactive or
urgent and for the claimant, beneficiary, and provider to be
notified upon completion. It does not require carriers to
acknowledge the receipt of a claim or a treatment authorization
request or to assign a tracking number.
Since carriers likely utilize computerized claims systems, it is
possible that they would already assign tracking numbers to
claims. It is unknown how many carriers currently track claims.
Additionally, it is unknown if carriers assign tracking numbers
to treatment authorization requests or whether or not they send
a receipt of claims or treatment authorization requests to
enrollees and providers.
Carriers could need to invest in software changes, updates, or
augmentations in order to 1) track claims, 2) track treatment
authorization requests, and 3) have the ability to notify
enrollees and providers of the receipt of claims and treatment
authorization requests in order to comply with this bill.
The proposed amendments would limit the notification of receipt
of claims and treatment authorizations to only providers instead
of both providers and enrollees.