BILL ANALYSIS �
AB 1846
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1846 (Gordon)
As Amended August 21, 2012
Majority vote
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|ASSEMBLY: |51-26|(May 29, 2012) |SENATE: |22-13|(August 23, |
| | | | | |2012) |
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Original Committee Reference: HEALTH
SUMMARY : Establishes a licensing framework at the California
Department of Insurance (CDI) and the Department of Managed
Health Care (DMHC) for Consumer Operated and Oriented Plans
(CO-OPs), which may be established and seek funding under the
Patient Protection and Affordable Care Act.
The Senate amendments :
1)Add intent that a CO-OP operated as a health care service plan
in California be subject to all state requirements applicable
to health care service plans, including, but not limited to,
licensure requirements, operation and renewal requirements,
and financial responsibility requirements.
2)Prohibit a board member or staff of the CO-OP from entering
into an agreement or transaction that would jeopardize member
control as specified. Permits a board member or staff of the
CO-OP to only enter into arm's length transactions as
described in specified federal regulations.
3)Subject a CO-OP admitted as a CO-OP insurer to be subject to
the same premium taxes as are imposed on for-profit health
insurers with a certificate of authority from the Insurance
Commissioner.
4)Delete requirements subjecting a CO-OP that contracts with the
Health Benefit Exchange (Exchange) to the same requirements,
terms, and conditions as those imposed on other carriers
participating in the Exchange.
5)Delete a provision which makes a violation of this bill
grounds for revocation of a CO-OPs license.
AB 1846
Page 2
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version as passed by the Senate.
FISCAL EFFECT : According to the Senate Appropriations
Committee:
1)One-time costs to DMHC to develop policies and adopt
regulations of about $90,000 (Managed Care Fund).
2)One-time costs to CDI to develop policies and adopt
regulations of about $80,000 (Insurance Fund).
3)Minor ongoing costs for enforcement (Managed Care Fund and
Insurance Fund) as the number of CO-OPs seeking licensure in
the state is likely to be small.
Analysis Prepared by : Teri Boughton / HEALTH / (916) 319-2097
FN: 0005478