BILL ANALYSIS Ó
AB 1761
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1761 (John A. Pérez)
As Amended August 14, 2012
Majority vote
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|ASSEMBLY: |74-0 |(April 26, |SENATE: |38-0 |(August 30, |
| | |2012) | | |2012) |
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Original Committee Reference: HEALTH
SUMMARY : Gives the Department of Managed Health Care (DMHC) and
the Commissioner of the California Department of Insurance (CDI)
enforcement authority over licensees (and solicitors) who hold
themselves out as representing or providing services on behalf
of the California Health Benefit Exchange (Exchange) without a
valid agreement. Makes holding oneself out as representing,
constituting, or otherwise providing services on behalf of the
Exchange without a valid agreement unfair competition.
The Senate amendments add a principal coauthor and make a minor
technical change.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the bill as passed by the Senate.
FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)DMHC indicates that it may incur enforcement costs in the tens
of thousands (Managed Care Fund).
2)Enforcement costs to CDI are expected to be minor (Insurance
Fund).
3)Enforcement costs to the Exchange are expected to be minor
(federal funds).
COMMENTS : According to the author, this bill helps prevent
deceptive marketing of the Exchange by not allowing individuals
or entities to represent themselves as acting on behalf of the
Exchange unless authorized to do so by the Exchange. The author
indicates that in January 2014, the Exchange will be operational
and need a marketing strategy to create awareness for its
AB 1761
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products. The author adds that the Health and Safety Code
defines "unfair business practices" for entities regulated by
DMHC, the Insurance Code defines "unfair methods of competition
and unfair deceptive acts or practices in the business of
insurance" for entities regulated by CDI, and the Government
Code establishes the duties of the Exchange, but none of these
code sections address the issue of deceptive marketing of the
Exchange.
Health Access California supports this bill because at the
moment that AB 1602 (John A. Pérez), Chapter 655, Statutes of
2010, was enacted to create the official Exchange to begin
implementation of the federal Patient Protection and Affordable
Care Act, there have been misleading Web sites put up by agents
and brokers that appear to be the official Web site of the
Exchange. According to Health Access California this bill takes
the simple step of saying that only an individual or entity with
a valid, in-force agreement with the Exchange can hold
themselves out as acting on behalf of the Exchange.
Analysis Prepared by : Teri Boughton / HEALTH / (916) 319-2097
FN: 0005188