Amended in Assembly May 23, 2014

Amended in Assembly April 2, 2014

California Legislature—2013–14 Regular Session

Assembly Bill No. 1877

Introduced by Assembly Member Cooley

(Coauthors: Assembly Members Dickinson, Beth Gaines, and Pan)

(Coauthor: Senator Gaines)

February 19, 2014

An act to add Title 22.1 (commencing with Section 100600) to the Government Code, relating to health care coverage, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 1877, as amended, Cooley. California Vision Care Access Council.

Existing law, the federal Patient Protection and Affordable Care Act, requires each state to establish an American Health Benefits Exchange to facilitate the purchase of qualified health plans by qualified individuals and small employers. PPACA prohibits an Exchange from making available any health plan other than a qualified health plan, except for certain stand-alone dental plans. Existing state law establishes the California Health Benefit Exchange within state government, specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans through the Exchange by qualified individuals and small employers by January 1, 2014.

This bill would establish the California Vision Care Access Council within state government and would require that the Council be governed by a board composed of 5 members appointed by the Governor and the Legislature, as specified. The bill would prohibit a member of the board or staff to the Council from being an employee begin insert o end insert begin insert f, end insert or in specified relationships begin delete with end delete begin insert with, end insert a health care provider or health care facility, or from benefiting financially from a decision that he or she participated in making or attempted to use his or her official position to influence, as specified. The would require the Council to construct, manage, and maintain a marketplace for the purchase of vision plans through participating carriers by qualified individuals and qualified employers and would require the Council to work with the Exchange to establish a direct link between the Internet Web site of the Exchange and the Internet Web site of the Council in order to connect consumers of the Exchange to the marketplace established by the Council. The bill would require the Council to refer consumer questions regarding health care eligibility and enrollment options to the Exchange, as specified.

This bill would also require the Council to establish the requirements for carrier participation in the marketplace and standards and criteria for selecting vision plans that are in the best interests of qualified individuals and employers, and imposing specified requirements on participating carriers. The bill would require a participating carrier to submit a justification for a premium increase to the Council prior to implementing the increase, and require participating carrier’s to make available to consumers an electronic directory of contracting vision care providers. The bill would also enact other related provisions.

This bill would create the California Vision Care Access Trust Fund as a continuously appropriated fund, thereby making an appropriation, would authorize the Council to assess a charge on the vision plans offered by participating carriers through the Council that is reasonable and necessary to support the development, operations, and prudent cash management of the Council, and would make the implementation of the bill’s provisions contingent on a determination by the board that at least $250,000 exists in the fund. begin insert The bill would prohibit General Fund moneys from being used for any of these purposes and would require that any costs associated with the implementation of these provisions be paid from the California Vision Care Access Trust Fund. end insert

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: ²⁄₃. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

This act shall be known and may be cited as the
California Vision Care Access Act.

SEC. 2.  

It is the intent of the Legislature to make the statutory
changes to California law necessary to establish a Vision Care
Access Council in California and its administrative board in a
manner that is consistent with the rules, regulations, and guidance
implementing the federal Patient Protection and Affordable Care
Act (Public Law 111-148), as amended by the federal Health Care
and Education Reconciliation Act of 2010 (Public Law 111-152),
hereafter the federal act. In doing so, it is the intent of the
Legislature to do all of the following:

(a) Provide Californians an organized, transparent marketplace
for the purchase of affordable, quality vision care coverage,
augmenting and supplementing the essential health benefits
available through the California Health Benefit Exchange.

(b) Guarantee the availability of vision coverage through the
private health insurance market to qualified individuals and
employees of qualified employers.

(c) Offer specialized vision health care service plan and health
insurance coverage in the individual and group markets on the
basis of price, quality, and service.

(d) Meet the requirements of the federal act and all applicable
federal guidance, rules, and regulations.

SEC. 3.  

Title 22.1 (commencing with Section 100600) is added
to the Government Code, to read:

 

Title 22.1.  CALIFORNIA VISION CARE ACCESS
MARKETPLACE

 

100600.  

For purposes of this title, the following definitions
shall apply:

(a) “Board” means the board described in subdivision (a) of
Section 100601.

(b) “Carrier” means either a private health insurer holding a
valid outstanding certificate of authority from the Insurance
Commissioner or a health care service plan, as defined under
subdivision (f) of Section 1345 of the Health and Safety Code,
licensed by the Department of Managed Health Care.

(c) “Council” means the Vision Care Access Council created
by Section 100601.

(d) “Exchange” means the California Health Benefit Exchange
established by Section 100500.

(e) “Federal act” means the federal Patient Protection and
Affordable Care Act (Public Law 111-148), as amended by the
federal Health Care and Education Reconciliation Act of 2010
(Public Law 111-152), and any amendments to, or regulations or
guidance issued under, those acts.

(f) “Fund” means the California Vision Care Access Trust Fund
established by Section 100620.

(g) “Marketplace” means the marketplace established under
Section 100603.

(h) “Qualified individual” means an individual who is eligible
to purchase coverage through the Exchange.

(i) “Qualified employer” means an employer that is eligible to
purchase coverage through the Exchange.

(j) “Vision plan” means a specialized health care service plan
contract, as defined in Section 1345 of the Health and Safety Code,
covering vision care services or a specialized health insurance
policy, as defined in Section 106 of the Insurance Code, covering
vision care services.

100601.  

(a) There is in the state government the California
Vision Care Access Council, an independent public entity not
affiliated with an agency or department, which shall be known as
the Council. The Council shall be governed by an executive board
consisting of five members who are residents of California. Of the
members of the board, three shall be appointed by the Governor,
one shall be appointed by the Senate Committee on Rules, and one
shall be appointed by the Speaker of the Assembly.

(b) Members of the board shall be appointed for a term of four
years, except that the initial appointment by the Senate Committee
on Rules shall be for a term of three years, and the initial
appointment by the Speaker of the Assembly shall be for a term
of two years. Appointments by the Governor made on or after
January 1, 2016, shall be subject to confirmation by the Senate. A
member of the board may continue to serve until the appointment
and qualification of his or her successor. Vacancies shall be filled
by appointment for the unexpired term. The board shall elect a
chairperson on an annual basis.

(c) (1) Each person appointed to the board shall have
demonstrated and acknowledged expertise in at least two of the
following areas:

(A) Individual health care coverage.

(B) Small employer health care coverage.

(C) Health benefits plan administration.

(D) Health care finance.

(E) Administering a public or private health care delivery
system.

(F) Purchasing health plan coverage.

(2) Appointing authorities shall consider the expertise of the
other members of the board and attempt to make appointments so
that the board’s composition reflects a diversity of expertise.

(d) The Council may establish interagency agreements for the
purposes of contracting for executive, administrative, and other
related services, if necessary.

(e) (1) A member of the board or of the staff of the Council
shall not be employed by, a consultant to, a member of the board
of directors of, affiliated with, or otherwise a representative of, a
carrier or other insurer, an agent or broker, a health care provider,
or a health care facility or health clinic while serving on the board
or on the staff of the Council. A member of the board or of the
staff of the Council shall not be a member, a board member, or an
employee of a trade association of carriers, health facilities, health
clinics, or health care providers while serving on the board or on
the staff of the Council. A member of the board or of the staff of
the Council shall not be a health care provider unless he or she is
not compensated for rendering services as a health care provider
and does not have an ownership interest in a professional health
care practice.

(2) For purposes of this subdivision, “health care provider”
means a person licensed or certified pursuant to Division 2
(commencing with Section 500) of the Business and Professions
Code, or licensed pursuant to the Osteopathic Act or the
Chiropractic Act.

(3) No member of the board shall make, participate in making,
or in any way attempt to use his or her official position to influence
the making of, any decision that he or she knows or has reason to
know will have a reasonably foreseeable material financial effect,
distinguishable from its effect on the public generally, on him or
her or a member of his or her immediate family, or on either of
the following:

(A) Any source of income, other than gifts and other than loans
by a commercial lending institution in the regular course of
business on terms available to the public without regard to official
status aggregating two hundred fifty dollars ($250) or more in
value provided to, received by, or promised to, the member within
12 months prior to the time when the decision is made.

(B) Any business entity in which the member is a director,
officer, partner, trustee, employee, or holds any position of
management.

(f) Each member of the board shall have the responsibility and
duty to meet the requirements of this title, the federal act, and all
applicable state and federal laws and regulations, to serve the public
interest of the individuals and small businesses seeking health care
coverage through the Council, and to ensure the operational
well-being and fiscal solvency of the Council.

(g) A board member shall not receive compensation for his or
her service on the board but may receive a per diem and
reimbursement for travel and other necessary expenses, as provided
in Section 103 of the Business and Professions Code, while
engaged in the performance of official duties of the board.

(h) There shall not be any liability in a private capacity on the
part of the board or any member of the board, or any officer or
employee of the board, for or on account of any act performed or
obligation entered into in an official capacity, when done in good
faith, without the intent to defraud, and in connection with the
administration, management, or conduct of this title or affairs
related to this title.

(i) (1) The board shall hire an executive director to organize,
administer, and manage the operations of the Council. The
executive director shall be exempt from civil service and shall
serve at the pleasure of the board.

(2) The board shall identify and fill other key executive
positions, as determined necessary by the board, who shall be
exempt from civil service to the extent permitted by law.

(3)   The board shall set the salaries for the exempt positions
described in paragraphs (1) and (2) in amounts that are reasonably
necessary to attract and retain individuals of superior qualifications.
The salaries shall be published by the board and shall be posted
on the Internet Web site of the Council.

(j) The board shall be subject to the Bagley-Keene Open Meeting
Act (Article 9 (commencing with Section 11120) of Chapter 1 of
Part 1 of Division 3 of Title 2), except that the board may hold
closed sessions when considering matters related to litigation,
personnel, contracting, and rates.

100603.  

The Council shall, at a minimum, do all of the
following:

(a) Construct, manage, and maintain a marketplace for the
purchase of vision plans through participating carriers by qualified
individuals and qualified employers. The marketplace shall offer
full and complete carrier information to consumers, shall ensure
a secure purchase functionality, and shall allow enrollees and
prospective enrollees to obtain standardized comparative
information on the plans offered through the marketplace.

(b) Maintain an Internet Web site through which enrollees and
prospective enrollees of vision plans may obtain standardized
comparative information on the plans offered in the marketplace.

(c) Work cooperatively with the Exchange to establish a direct
link from the Internet Web site maintained by the Exchange to an
Internet Web site maintained by the Council to connect Exchange
consumers to the marketplace.

(d) Make the marketplace available to individuals without access
to the Internet.

(e) Determine the minimum requirements a carrier shall meet
to be considered for participation in the marketplace, and the
standards and criteria for selecting vision plans to be offered
through the marketplace that are in the best interests of consumers.
The board shall consistently and uniformly apply these
requirements, standards, and criteria to all carriers. In the course
of selectively contracting for vision coverage offered to qualified
individuals and qualified employers through the Council, the board
shall seek to contract with carriers so as to provide vision coverage
choices that offer the optimal combination of choice, value, quality,
and service. The requirements adopted pursuant to this subdivision
shall, at a minimum, include the following:

(1) A requirement that a carrier meet a minimum net asset
threshold as determined by the Council to ensure that it is both
well established and can demonstrate that it offers a proven model
for providing vision care coverage in California. The Council may
also consider the usefulness of setting a minimum annual premium
revenue as evidence of the soundness of the carrier.

(2) A requirement that a carrier have, and continuously maintain,
an established Internet Web site.

(3) A requirement that a carrier demonstrate to the Council
adequate vision care coverage networks sufficient to ensure
convenient geographic access to vision care in California.

(4) A requirement that a carrier demonstrate to the Council
adequate, multilingual consumer service and benefit delivery
capabilities.

(5) Any other requirements determined necessary by the board
based on input from health care consumer advocacy organizations,
representatives of the optometry and ophthalmology industries,
health insurers, and health care service plans.

(f) Require vision plans offered in the marketplace to do both
of the following:

(1) (A) Make available to the public, and the Insurance
Commissioner or the Department of Managed Health Care, as
applicable, accurate and timely disclosure of the following
information:

(i) Claims payment policies and practices.

(ii) Periodic financial disclosures.

(iii) Data on enrollment.

(iv) Data on disenrollment.

(v) Data on the number of claims that are denied.

(vi) Information on cost sharing and payments with respect to
any out-of-network coverage.

(B) The information required under subparagraph (A) shall be
provided in plain language.

(2) Permit individuals to learn, in a timely manner upon the
request of the individual, the amount of cost sharing, including,
but not limited to, deductibles, copayments, and coinsurance, under
the individual’s plan or coverage that the individual would be
responsible for paying with respect to the furnishing of a specific
item or service by a participating provider. At a minimum, this
information shall be made available to the individual through an
Internet Web site and through other means for individuals without
access to the Internet.

(g) Provide for the operation of a toll-free telephone hotline to
respond to requests for assistance.

(h) Establish and make available by electronic means a
calculator to determine the actual cost of a vision plan for a
consumer.

(i) Conduct public education activities to raise awareness of the
availability of vision plans through the Council.

(j) Distribute fair and impartial information concerning
enrollment in coverage offered through the Council.

(k) Facilitate enrollment of qualified individuals and qualified
employers in vision plans offered through the Council.

(l) Provide referrals to any applicable office of health insurance
consumer assistance or health insurance ombudsman, or any other
appropriate state agency or agencies, for any enrollee with a
grievance, complaint, or question regarding a participating carrier,
coverage purchased pursuant to this title, or a determination by
the carrier or under that coverage.

(m) Provide information in a manner that is culturally and
linguistically appropriate to the needs of the population being
served by the Council.

(n) Undertake activities necessary to market and publicize the
availability of vision plans through the Council, ensuring clear
communication to consumers that federal subsidies are not
available for this coverage. The board shall also undertake outreach
and enrollment activities that seek to assist enrollees and potential
enrollees with enrolling and reenrolling in the coverage offered
by the Council in the least burdensome manner, including
populations that may experience barriers to enrollment, such as
the disabled and those with limited English language proficiency.

(o) Employ necessary staff.

(p) Assess a charge on the vision plans offered by participating
carriers through the marketplace that is reasonable and necessary
to support the development, operations, and prudent cash
management of the Council.

(q) Authorize expenditures, as necessary, from the fund to pay
program expenses to administer the Council.

(r) Keep an accurate accounting of all activities, receipts, and
expenditures, and annually publish a report concerning that
accounting.

(s) (1) Annually publish a report on the implementation and
performance of the Council functions during the preceding fiscal
year, that shall be made available to the public on the Internet Web
site of the Council.

(2) In addition to the report described in paragraph (1), the
Council shall be responsive to requests for additional information
from the Legislature, including providing testimony and
commenting on proposed state legislation or policy issues.

(t) Exercise all powers reasonably necessary to carry out and
comply with the duties, responsibilities, and requirements of this
act.

(u) Consult with stakeholders relevant to carrying out the
activities under this title, including, but not limited to, all of the
following:

(1) Health care consumers who are enrolled in vision plans.

(2) Individuals and entities with experience in facilitating
enrollment in vision plans.

(3) Representatives of small businesses and self-employed
individuals.

(v) Require participating carriers to regularly, as determined by
the Council, provide the Council with enrollment or disenrollment
data.

(w) Ensure that the Council provides oral interpretation services
in any language for individuals seeking coverage through the
Council and makes available a toll-free telephone number for the
hearing and speech impaired. The Council shall ensure that written
information made available by the Council is presented in a plainly
worded, easily understandable format and made available in
California’s prevalent languages.

(x) Provide a choice of carrier in each region of the state.

(y) (1) Require, as a condition of participation in the Council,
carriers that sell vision products outside the Council to do both of
the following:

(A) Fairly and affirmatively offer, market, and sell all products
made available to individuals in the marketplace to individuals
purchasing coverage outside the Council. The products available
in the marketplace shall be the same individual product as offered
outside the Council.

(B) Fairly and affirmatively offer, market, and sell all products
made available to employers in the marketplace to employers
purchasing coverage outside the Council. The products available
in the marketplace shall be the same employer coverage products
as offered outside the Council.

(2) For purposes of this subdivision, “product” does not include
contracts entered into pursuant to Part 6.2 (commencing with
Section 12693) of Division 2 of the Insurance Code between the
Managed Risk Medical Insurance Board and carriers for enrolled
Healthy Families beneficiaries or contracts entered into pursuant
to Chapter 7 (commencing with Section 14000) of, or Chapter 8
(commencing with Section 14200) of, Part 3 of Division 9 of the
Welfare and Institutions Code between the State Department of
Health Care Services and carriers for enrolled Medi-Cal
beneficiaries.

(z) Determine and approve cost-sharing provisions for carriers.

(aa) Standardize products to be offered through the Council.

(ab) Share information with relevant state departments,
consistent with the confidentiality provisions in Section 1411 of
the federal act, necessary for the administration of the Council.

(ac) Collect only that information from individuals or designees
of individuals as is necessary to administer the Council and
consistent with the federal act.

100605.  

The Council may do any of the following:

(a) Enter into contracts.

(b) Adopt an official seal.

(c) Sue and be sued.

(d) Receive and accept gifts, grants, or donations of moneys
from any agency of the United States, any agency of the state, any
municipality, county, or other political subdivision of the state.

(e) Receive and accept gifts, grants, or donations from
individuals, associations, private foundations, or corporations, in
compliance with the conflict-of-interest provisions to be adopted
by the board at a public meeting.

(f) Adopt rules and regulations as necessary.

100606.  

(a) A participating carrier shall submit to the Council
a written justification for a premium increase prior to implementing
the increase.

(b) A participating carrier shall utilize a standardized format
for presenting vision plan options to the Council.

(c) The Council shall refer questions from consumers regarding
eligibility and enrollment options for Medi-Cal or through the
Exchange to the Exchange.

(d) (1) The Council shall require a participating carrier to make
available to consumers and regularly update an electronic directory
of contracting vision care providers in the carrier’s network.

(2) The Council may also require a participating carrier to
provide regularly updated information to the Council as to whether
a health care provider is accepting new patients for a particular
vision plan.

(3) The Council may provide an integrated and uniform
consumer directory of health care providers indicating which
participating carriers the providers contract with and whether the
providers are currently accepting new patients.

(4) The Council may establish methods by which health care
providers may transmit relevant information directly to the Council,
rather than through a participating carrier.

100607.  

(a) Notwithstanding any other provision of law, the
Council shall not be subject to licensure or regulation by the
Department of Insurance or the Department of Managed Health
Care.

(b) Carriers that contract with the Council shall have and
maintain a license or certificate of authority from, and shall be in
good standing with, their respective regulatory agencies.

100609.  

Records of the Council that reveal any of the following
shall be exempt from disclosure under the California Public
Records Act (Chapter 3.5 (commencing with Section 6250) of
Division 7 of Title 1):

(a) The deliberative processes, discussions, communications,
or any other portion of the negotiations with entities contracting
or seeking to contract with the Council, entities with which the
Council is considering a contract, or entities with which the Council
is considering or enters into any other arrangement under which
the Council provides, receives, or arranges services or
reimbursement.

(b) The impressions, opinions, recommendations, meeting
minutes, research, work product, theories, or strategy of the board
or its staff, or records that provide instructions, advice, or training
to employees.

100620.  

(a) The California Vision Care Access Trust Fund is
hereby created in the State Treasury for the purpose of this title.
Moneys collected pursuant to this title shall be deposited in the
fund. Notwithstanding Section 13340, all moneys in the fund shall
be continuously appropriated without regard to fiscal year for the
purposes of this title. Any moneys in the fund that are unexpended
or unencumbered at the end of a fiscal year may be carried forward
to the next succeeding fiscal year.

(b) Notwithstanding any other provision of law, moneys
deposited in the fund shall not be loaned to, or borrowed by, any
other special fund or the General Fund, or a county general fund
or any other county fund.

(c) The Council shall establish and maintain a prudent reserve
in the fund.

(d) The board or staff of the Council shall not utilize any funds
intended for the administrative and operational expenses of the
Council for staff retreats, promotional giveaways, excessive
executive compensation, or promotion of federal or state legislative
or regulatory modifications.

(e) Notwithstanding Section 16305.7, all interest earned on the
moneys that have been deposited into the fund shall be retained
in the fund and used for purposes consistent with the fund.

begin insert

(f) (1) State General Fund moneys shall not be used for any
purpose under this title.

end insert begin insert

(2) Any costs associated with the implementation of this title
shall be paid from the fund.

end insert

100621.  

(a) The implementation of the provisions of this title,
other than this section and Sections 100601 and 100605, shall be
contingent on a determination by the board that at least two
hundred fifty thousand dollars ($250,000) exists in the fund.

(b) The board shall provide notice to the Joint Legislative Budget
Committee and the Director of Finance when the financial
threshold set forth in subdivision (a) has been reached.

SEC. 4.  

The Legislature finds and declares that Section 3 of
this act, which adds Section 100609 to the Government Code,
imposes a limitation on the public’s right of access to the meetings
of public bodies or the writings of public officials and agencies
within the meaning of Section 3 of Article I of the California
Constitution. Pursuant to that constitutional provision, the
Legislature makes the following findings to demonstrate the interest
protected by this limitation and the need for protecting that interest:

In order to ensure that the California Vision Care Access Council
is not constrained in exercising its fiduciary powers and obligations
to provide consumers with the most accessible and affordable
vision care benefits augmenting the benefits available through the
California Health Benefit Exchange, the limitations on the public’s
right of access imposed by Section 3 of this act are necessary.

SEC. 5.  

This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

In order to provide Californians an organized, transparent
marketplace for the purchase of affordable, quality vision care
coverage, augmenting and supplementing the essential health
benefits available through the California Health Benefit Exchange
in a manner consistent with evolving federal rules, regulations,
and official guidance implementing the federal Patient Protection
and Affordable Care Act (Public Law 111-148), as amended by
the federal Health Care and Education Reconciliation Act of 2010
(Public Law 111-152), it is necessary that this act take effect
immediately.