SB 974, as amended, Anderson. California Health Benefit Exchange.
Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that take effect January 1, 2014. Among other things, PPACA requires each health insurance issuer that offers health insurance coverage in the individual or group market in a state to accept every employer and individual in the state that applies for that coverage and to renew that coverage at the option of the plan sponsor or the individual. PPACA also requires each state to, by January 1, 2014, establish an American Health Benefit Exchange that facilitates the purchase of qualified health plans by qualified individuals and qualified small employers, as specified.
Existing 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. Existing law requires the board, among other things, to determine the criteria and process for eligibility, enrollment, and disenrollment of enrollees and potentialbegin delete enrollesend deletebegin insert enrolleesend insert in the Exchange and coordinate that process with state and local government entities administering other specified health care coverage programs, as specified.
This bill would additionally require the board to allow an applicant to indicate in his or her application for a qualified health plan whether or not he or she would like assistance with completing the application from an Exchange certified insurance agent or certified enrollment
counselor. The bill would also prohibit the Exchange from disclosingbegin delete informationend deletebegin insert
personal information, as defined,end insert to a certified insurance agent or certified enrollment counselor if the applicant indicates that he or she does not want assistance from an Exchange certified insurance agent or certified enrollment counselor.
This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2⁄3. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 100503 of the Government Code, as
2amended by Section 4 of Chapter 5 of the First Extraordinary
3Session of the Statutes of 2013, is amended to read:
In addition to meeting the minimum requirements of
5Section 1311 of the federal act, the board shall do all of the
6following:
7(a) (1) Determine the criteria and process for eligibility,
8enrollment, and disenrollment of enrollees and potential enrollees
9in the Exchange and coordinate that process with the state and
10local government entities administering other health care coverage
11programs, including the State Department of Health Care Services,
12the Managed Risk Medical Insurance Board, and California
13counties, in order to ensure consistent eligibility and enrollment
14processes and seamless transitions between coverage.
15(2) (A) Allow an applicant to indicate in his or her application
16for a qualified health plan whether or not he or she would like
17assistance with completing the application from an Exchange
18certified insurance agent or certified enrollment counselor.
19(B) The Exchange shall not disclosebegin delete informationend deletebegin insert personal
20information, as defined in Section 1798.3 of the Civil Code,end insert to a
P3 1certified insurance agent or certified enrollment counselor if the
2applicant indicates thatbegin insert heend insert or she does not want assistance from
3an Exchange certified insurance agent or certified enrollment
4
counselor.
5(b) Develop processes to coordinate with the county entities
6that administer eligibility for the Medi-Cal program and the entity
7that determines eligibility for the Healthy Families Program,
8including, but not limited to, processes for case transfer, referral,
9and enrollment in the Exchange of individuals applying for
10assistance to those entities, if allowed or required by federal law.
11(c) Determine the minimum requirements a carrier must meet
12to be considered for participation in the Exchange, and the
13standards and criteria for selecting qualified health plans to be
14offered through the Exchange that are in the best interests of
15qualified individuals and qualified small employers. The board
16shall consistently and uniformly apply these requirements,
17standards, and
criteria to all carriers. In the course of selectively
18contracting for health care coverage offered to qualified individuals
19and qualified small employers through the Exchange, the board
20shall seek to contract with carriers so as to provide health care
21coverage choices that offer the optimal combination of choice,
22value, quality, and service.
23(d) Provide, in each region of the state, a choice of qualified
24health plans at each of the five levels of coverage contained in
25subsections (d) and (e) of Section 1302 of the federal act.
26(e) Require, as a condition of participation in the Exchange,
27carriers to fairly and affirmatively offer, market, and sell in the
28Exchange at least one product within each of the five levels of
29coverage contained in subsections (d) and (e) of Section 1302 of
30the
federal act. The board may require carriers to offer additional
31products within each of those five levels of coverage. This
32subdivision shall not apply to a carrier that solely offers
33supplemental coverage in the Exchange under paragraph (10) of
34subdivision (a) of Section 100504.
35(f) (1) Except as otherwise provided in this section and Section
36100504.5, require, as a condition of participation in the Exchange,
37carriers that sell any products outside the Exchange to do both of
38the following:
P4 1(A) Fairly and affirmatively offer, market, and sell all products
2made available to individuals in the Exchange to individuals
3purchasing coverage outside the Exchange.
4(B) Fairly and affirmatively offer, market,
and sell all products
5made available to small employers in the Exchange to small
6employers purchasing coverage outside the Exchange.
7(2) For purposes of this subdivision, “product” does not include
8contracts entered into pursuant to Part 6.2 (commencing with
9Section 12693) of Division 2 of the Insurance Code between the
10Managed Risk Medical Insurance Board and carriers for enrolled
11Healthy Families beneficiaries or contracts entered into pursuant
12to Chapter 7 (commencing with Section 14000) of, or Chapter 8
13(commencing with Section 14200) of, Part 3 of Division 9 of the
14Welfare and Institutions Code between the State Department of
15Health Care Services and carriers for enrolled Medi-Cal
16beneficiaries. “Product” also does not include a bridge plan product
17offered pursuant to Section 100504.5.
18(3) Except as required by Section 1301(a)(1)(C)(ii) of the federal
19act, a carrier offering a bridge plan product in the Exchange may
20limit the products it offers in the Exchange solely to a bridge plan
21product contract.
22(g) Determine when an enrollee’s coverage commences and the
23extent and scope of coverage.
24(h) Provide for the processing of applications and the enrollment
25and disenrollment of enrollees.
26(i) Determine and approve cost-sharing provisions for qualified
27health plans.
28(j) Establish uniform billing and payment policies for qualified
29health plans offered in the Exchange to ensure consistent
30enrollment and disenrollment activities for
individuals enrolled in
31the Exchange.
32(k) Undertake activities necessary to market and publicize the
33availability of health care coverage and federal subsidies through
34the Exchange. The board shall also undertake outreach and
35enrollment activities that seek to assist enrollees and potential
36enrollees with enrolling and reenrolling in the Exchange in the
37least burdensome manner, including populations that may
38experience barriers to enrollment, such as the disabled and those
39with limited English language proficiency.
P5 1(l) Select and set performance standards and compensation for
2navigators selected under subdivision (l) of Section 100502.
3(m) Employ necessary staff.
4(1) The board shall hire a chief fiscal officer, a chief operations
5officer, a director for the SHOP Exchange, a director of Health
6Plan Contracting, a chief technology and information officer, a
7general counsel, and other key executive positions, as determined
8by the board, who shall be exempt from civil service.
9(2) (A) The board shall set the salaries for the exempt positions
10described in paragraph (1) and subdivision (i) of Section 100500
11in amounts that are reasonably necessary to attract and retain
12individuals of superior qualifications. The salaries shall be
13published by the board in the board’s annual budget. The board’s
14annual budget shall be posted on the Internet Web site of the
15Exchange. To determine the compensation for these positions, the
16board shall cause to be conducted, through the use of independent
17
outside advisors, salary surveys of both of the following:
18(i) Other state and federal health insurance exchanges that are
19most comparable to the Exchange.
20(ii) Other relevant labor pools.
21(B) The salaries established by the board under subparagraph
22(A) shall not exceed the highest comparable salary for a position
23of that type, as determined by the surveys conducted pursuant to
24subparagraph (A).
25(C) The Department of Human Resources shall review the
26methodology used in the surveys conducted pursuant to
27subparagraph (A).
28(3) The positions described in paragraph (1) and subdivision (i)
29of
Section 100500 shall not be subject to otherwise applicable
30provisions of the Government Code or the Public Contract Code
31and, for those purposes, the Exchange shall not be considered a
32state agency or public entity.
33(n) Assess a charge on the qualified health plans offered by
34carriers that is reasonable and necessary to support the
35development, operations, and prudent cash management of the
36Exchange. This charge shall not affect the requirement under
37Section 1301 of the federal act that carriers charge the same
38premium rate for each qualified health plan whether offered inside
39or outside the Exchange.
P6 1(o) Authorize expenditures, as necessary, from the California
2Health Trust Fund to pay program expenses to administer the
3Exchange.
4(p) Keep an accurate accounting of all activities, receipts, and
5expenditures, and annually submit to the United States Secretary
6of Health and Human Services a report concerning that accounting.
7Commencing January 1, 2016, the board shall conduct an annual
8audit.
9(q) (1) Annually prepare a written report on the implementation
10and performance of the Exchange functions during the preceding
11fiscal year, including, at a minimum, the manner in which funds
12were expended and the progress toward, and the achievement of,
13the requirements of this title. The report shall also include data
14provided by health care service plans and health insurers offering
15bridge plan products regarding the extent of health care provider
16and health facility overlap in their Medi-Cal networks as compared
17to the health care provider and
health facility networks contracting
18with the plan or insurer in their bridge plan contracts. This report
19shall be transmitted to the Legislature and the Governor and shall
20be made available to the public on the Internet Web site of the
21Exchange. A report made to the Legislature pursuant to this
22
subdivision shall be submitted pursuant to Section 9795.
23(2) The Exchange shall prepare, or contract for the preparation
24of, an evaluation of the bridge plan program using the first three
25years of experience with the program. The evaluation shall be
26provided to the health policy and fiscal committees of the
27Legislature in the fourth year following federal approval of the
28bridge plan option. The evaluation shall include, but not be limited
29to, all of the following:
30(A) The number of individuals eligible to participate in the
31bridge plan program each year by category of eligibility.
32(B) The number of eligible individuals who elect a bridge plan
33option each year by category of eligibility.
34(C) The average length of time, by region and statewide, that
35
individuals remain in the bridge plan option each year by category
36of eligibility.
37(D) The regions of the state with a bridge plan option, and the
38carriers in each region that offer a bridge plan, by year.
P7 1(E) The premium difference each year, by region, between the
2bridge plan and the first and second lowest cost plan for individuals
3in the Exchange who are not eligible for the bridge plan.
4(F) The effect of the bridge plan on the premium subsidy amount
5for bridge plan eligible individuals each year by each region.
6(G) Based on a survey of individuals enrolled in the bridge plan:
7(i) Whether
individuals enrolling in the bridge plan product are
8able to keep their existing health care providers.
9(ii) Whether individuals would want to retain their bridge plan
10product, buy a different Exchange product, or decline to purchase
11health insurance if there was no bridge plan product available. The
12Exchange may include questions designed to elicit the information
13in this subparagraph as part of an existing survey of individuals
14receiving coverage in the Exchange.
15(3) In addition to the evaluation required by paragraph (2), the
16Exchange shall post the items in subparagraphs (A) to (F),
17inclusive, on its Internet Web site each year.
18(4) In addition to the report described in paragraph (1), the board
19shall be responsive to
requests for additional information from the
20Legislature, including providing testimony and commenting on
21proposed state legislation or policy issues. The Legislature finds
22and declares that activities including, but not limited to, responding
23to legislative or executive inquiries, tracking and commenting on
24legislation and regulatory activities, and preparing reports on the
25implementation of this title and the performance of the Exchange,
26are necessary state requirements and are distinct from the
27promotion of legislative or regulatory modifications referred to in
28subdivision (d) of Section 100520.
29(r) Maintain enrollment and expenditures to ensure that
30expenditures do not exceed the amount of revenue in the fund, and
31if sufficient revenue is not available to pay estimated expenditures,
32institute appropriate measures to ensure fiscal
solvency.
33(s) Exercise all powers reasonably necessary to carry out and
34comply with the duties, responsibilities, and requirements of this
35act and the federal act.
36(t) Consult with stakeholders relevant to carrying out the
37activities under this title, including, but not limited to, all of the
38following:
39(1) Health care consumers who are enrolled in health plans.
P8 1(2) Individuals and entities with experience in facilitating
2enrollment in health plans.
3(3) Representatives of small businesses and self-employed
4individuals.
5(4) The State Medi-Cal Director.
6(5) Advocates for enrolling hard-to-reach populations.
7(u) Facilitate the purchase of qualified health plans in the
8Exchange by qualified individuals and qualified small employers
9no later than January 1, 2014.
10(v) Report, or contract with an independent entity to report, to
11the Legislature by December 1, 2018, on whether to adopt the
12option in Section 1312(c)(3) of the federal act to merge the
13individual and small employer markets. In its report, the board
14shall provide information, based on at least two years of data from
15the Exchange, on the potential impact on rates paid by individuals
16and by small employers in a merged individual and small employer
17market, as compared to the rates paid by
individuals and small
18employers if a separate individual and small employer market is
19maintained. A report made pursuant to this subdivision shall be
20submitted pursuant to Section 9795.
21(w) With respect to the SHOP Program, collect premiums and
22administer all other necessary and related tasks, including, but not
23limited to, enrollment and plan payment, in order to make the
24offering of employee plan choice as simple as possible for qualified
25small employers.
26(x) Require carriers participating in the Exchange to immediately
27notify the Exchange, under the terms and conditions established
28by the board when an individual is or will be enrolled in or
29disenrolled from any qualified health plan offered by the carrier.
30(y) Ensure that the Exchange provides oral interpretation
31services in any language for individuals seeking coverage through
32the Exchange and makes available a toll-free telephone number
33for the hearing and speech impaired. The board shall ensure that
34written information made available by the Exchange is presented
35in a plainly worded, easily understandable format and made
36available in prevalent languages.
37(z) This section shall become inoperative on the October 1 that
38is five years after the date that federal approval of the bridge plan
39option occurs, and, as of the second January 1 thereafter, is
40repealed, unless a later enacted statute that is enacted before that
P9 1date deletes or extends the dates on which it becomes inoperative
2and is repealed.
Section 100503 of the Government Code, as added by
4Section 5 of Chapter 5 of the First Extraordinary Session of the
5Statutes of 2013, is amended to read:
In addition to meeting the minimum requirements of
7Section 1311 of the federal act, the board shall do all of the
8following:
9(a) (1) Determine the criteria and process for eligibility,
10enrollment, and disenrollment of enrollees and potential enrollees
11in the Exchange and coordinate that process with the state and
12local government entities administering other health care coverage
13programs, including the State Department of Health Care Services,
14the Managed Risk Medical Insurance Board, and California
15counties, in order to ensure consistent eligibility and enrollment
16processes and seamless transitions between coverage.
17(2) (A) Allow an applicant to indicate in his or her application
18for a qualified health plan whether or not he or she would like
19assistance with completing that application from an Exchange
20certified insurance agent or certified enrollment counselor.
21(B) The Exchange shall not disclosebegin delete informationend deletebegin insert personal
22information, as defined in Section 1798.3 of the Civil Code,end insert to a
23certified insurance agent or certified enrollment counselor if the
24applicant indicates thatbegin insert heend insert or she does not want assistance from
25an Exchange certified insurance agent or certified enrollment
26
counselor.
27(b) Develop processes to coordinate with the county entities
28that administer eligibility for the Medi-Cal program and the entity
29that determines eligibility for the Healthy Families Program,
30including, but not limited to, processes for case transfer, referral,
31and enrollment in the Exchange of individuals applying for
32assistance to those entities, if allowed or required by federal law.
33(c) Determine the minimum requirements a carrier must meet
34to be considered for participation in the Exchange, and the
35standards and criteria for selecting qualified health plans to be
36offered through the Exchange that are in the best interests of
37qualified individuals and qualified small employers. The board
38shall consistently and uniformly apply these requirements,
39standards, and
criteria to all carriers. In the course of selectively
40contracting for health care coverage offered to qualified individuals
P10 1and qualified small employers through the Exchange, the board
2shall seek to contract with carriers so as to provide health care
3coverage choices that offer the optimal combination of choice,
4value, quality, and service.
5(d) Provide, in each region of the state, a choice of qualified
6health plans at each of the five levels of coverage contained in
7subsections (d) and (e) of Section 1302 of the federal act.
8(e) Require, as a condition of participation in the Exchange,
9carriers to fairly and affirmatively offer, market, and sell in the
10Exchange at least one product within each of the five levels of
11coverage contained in subsections (d) and (e) of Section 1302
of
12the federal act. The board may require carriers to offer additional
13products within each of those five levels of coverage. This
14subdivision shall not apply to a carrier that solely offers
15supplemental coverage in the Exchange under paragraph (10) of
16subdivision (a) of Section 100504.
17(f) (1) Require, as a condition of participation in the Exchange,
18carriers that sell any products outside the Exchange to do both of
19the following:
20(A) Fairly and affirmatively offer, market, and sell all products
21made available to individuals in the Exchange to individuals
22purchasing coverage outside the Exchange.
23(B) Fairly and affirmatively offer, market, and sell all products
24made available to small employers in
the Exchange to small
25employers purchasing coverage outside the Exchange.
26(2) For purposes of this subdivision, “product” does not include
27contracts entered into pursuant to Part 6.2 (commencing with
28Section 12693) of Division 2 of the Insurance Code between the
29Managed Risk Medical Insurance Board and carriers for enrolled
30Healthy Families beneficiaries or contracts entered into pursuant
31to Chapter 7 (commencing with Section 14000) of, or Chapter 8
32(commencing with Section 14200) of, Part 3 of Division 9 of the
33Welfare and Institutions Code between the State Department of
34Health Care Services and carriers for enrolled Medi-Cal
35beneficiaries.
36(g) Determine when an enrollee’s coverage commences and the
37extent and scope of coverage.
38(h) Provide for the processing of applications and the enrollment
39and disenrollment of enrollees.
P11 1(i) Determine and approve cost-sharing provisions for qualified
2health plans.
3(j) Establish uniform billing and payment policies for qualified
4health plans offered in the Exchange to ensure consistent
5enrollment and disenrollment activities for individuals enrolled in
6the Exchange.
7(k) Undertake activities necessary to market and publicize the
8availability of health care coverage and federal subsidies through
9the Exchange. The board shall also undertake outreach and
10enrollment activities that seek to assist enrollees and potential
11enrollees with enrolling and reenrolling in the Exchange in the
12least
burdensome manner, including populations that may
13experience barriers to enrollment, such as the disabled and those
14with limited English language proficiency.
15(l) Select and set performance standards and compensation for
16navigators selected under subdivision (l) of Section 100502.
17(m) Employ necessary staff.
18(1) The board shall hire a chief fiscal officer, a chief operations
19officer, a director for the SHOP Exchange, a director of Health
20Plan Contracting, a chief technology and information officer, a
21general counsel, and other key executive positions, as determined
22by the board, who shall be exempt from civil service.
23(2) (A) The board shall set the
salaries for the exempt positions
24described in paragraph (1) and subdivision (i) of Section 100500
25in amounts that are reasonably necessary to attract and retain
26individuals of superior qualifications. The salaries shall be
27published by the board in the board’s annual budget. The board’s
28annual budget shall be posted on the Internet Web site of the
29Exchange. To determine the compensation for these positions, the
30board shall cause to be conducted, through the use of independent
31outside advisors, salary surveys of both of the following:
32(i) Other state and federal health insurance exchanges that are
33most comparable to the Exchange.
34(ii) Other relevant labor pools.
35(B) The salaries established by the board under subparagraph
36(A)
shall not exceed the highest comparable salary for a position
37of that type, as determined by the surveys conducted pursuant to
38subparagraph (A).
P12 1(C) The Department of Human Resources shall review the
2methodology used in the surveys conducted pursuant to
3subparagraph (A).
4(3) The positions described in paragraph (1) and subdivision (i)
5of Section 100500 shall not be subject to otherwise applicable
6provisions of the Government Code or the Public Contract Code
7and, for those purposes, the Exchange shall not be considered a
8state agency or public entity.
9(n) Assess a charge on the qualified health plans offered by
10carriers that is reasonable and necessary to support the
11development, operations, and prudent cash
management of the
12Exchange. This charge shall not affect the requirement under
13Section 1301 of the federal act that carriers charge the same
14premium rate for each qualified health plan whether offered inside
15or outside the Exchange.
16(o) Authorize expenditures, as necessary, from the California
17Health Trust Fund to pay program expenses to administer the
18Exchange.
19(p) Keep an accurate accounting of all activities, receipts, and
20expenditures, and annually submit to the United States Secretary
21of Health and Human Services a report concerning that accounting.
22Commencing January 1, 2016, the board shall conduct an annual
23audit.
24(q) (1) Annually prepare a written report on the implementation
25and
performance of the Exchange functions during the preceding
26fiscal year, including, at a minimum, the manner in which funds
27were expended and the progress toward, and the achievement of,
28the requirements of this title. This report shall be transmitted to
29the Legislature and the Governor and shall be made available to
30the public on the Internet Web site of the Exchange. A report made
31to the Legislature pursuant to this subdivision shall be submitted
32pursuant to Section 9795.
33(2) In addition to the report described in paragraph (1), the board
34shall be responsive to requests for additional information from the
35Legislature, including providing testimony and commenting on
36proposed state legislation or policy issues. The Legislature finds
37and declares that activities including, but not limited to, responding
38to legislative or executive inquiries,
tracking and commenting on
39legislation and regulatory activities, and preparing reports on the
40implementation of this title and the performance of the Exchange,
P13 1are necessary state requirements and are distinct from the
2promotion of legislative or regulatory modifications referred to in
3
subdivision (d) of Section 100520.
4(r) Maintain enrollment and expenditures to ensure that
5expenditures do not exceed the amount of revenue in the fund, and
6if sufficient revenue is not available to pay estimated expenditures,
7institute appropriate measures to ensure fiscal solvency.
8(s) Exercise all powers reasonably necessary to carry out and
9comply with the duties, responsibilities, and requirements of this
10act and the federal act.
11(t) Consult with stakeholders relevant to carrying out the
12activities under this title, including, but not limited to, all of the
13following:
14(1) Health care consumers who are enrolled in health plans.
15(2) Individuals and entities with experience in facilitating
16enrollment in health plans.
17(3) Representatives of small businesses and self-employed
18individuals.
19(4) The State Medi-Cal Director.
20(5) Advocates for enrolling hard-to-reach populations.
21(u) Facilitate the purchase of qualified health plans in the
22Exchange by qualified individuals and qualified small employers
23no later than January 1, 2014.
24(v) Report, or contract with an independent entity to report, to
25the Legislature by December 1, 2018, on whether to adopt the
26option in Section
1312(c)(3) of the federal act to merge the
27individual and small employer markets. In its report, the board
28shall provide information, based on at least two years of data from
29the Exchange, on the potential impact on rates paid by individuals
30and by small employers in a merged individual and small employer
31market, as compared to the rates paid by individuals and small
32employers if a separate individual and small employer market is
33maintained. A report made pursuant to this subdivision shall be
34submitted pursuant to Section 9795.
35(w) With respect to the SHOP Program, collect premiums and
36administer all other necessary and related tasks, including, but not
37limited to, enrollment and plan payment, in order to make the
38offering of employee plan choice as simple as possible for qualified
39small employers.
P14 1(x) Require carriers participating in the Exchange to immediately
2notify the Exchange, under the terms and conditions established
3by the board when an individual is or will be enrolled in or
4disenrolled from any qualified health plan offered by the carrier.
5(y) Ensure that the Exchange provides oral interpretation
6services in any language for individuals seeking coverage through
7the Exchange and makes available a toll-free telephone number
8for the hearing and speech impaired. The board shall ensure that
9written information made available by the Exchange is presented
10in a plainly worded, easily understandable format and made
11available in prevalent languages.
12(z) This section shall become operative only if Section 4 of the
13act that added this section becomes inoperative
pursuant to
14subdivision (z) of that Section 4.
Sections 1 and 2 of this bill shall become operative on
16October 1, 2014.
This act is an urgency statute necessary for the
19immediate preservation of the public peace, health, or safety within
20the meaning of Article IV of the Constitution and shall go into
21immediate effect. The facts constituting the necessity are:
22Protecting Californian’s privacy rights is of the utmost
23importance, and in order to protect the privacy rights of individuals
24applying for health care coverage through the California Health
25Benefit Exchange at the earliest possible time, it is
necessary that
26this act take effect immediately.
O
97