BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  SB 974
                                                                  Page  1

          Date of Hearing:   August 6, 2014

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                   SB 974 (Anderson) - As Amended:  June 30, 2014 

          Policy Committee:                             HealthVote:19-0

          Urgency:     Yes                  State Mandated Local Program:  
          No     Reimbursable:              No

           SUMMARY  

          This bill makes minor changes to privacy policies related to  
          applications for health coverage through the California Health  
          Benefits Exchange (Covered California).   Specifically, this  
          bill requires the Exchange to allow consumers to indicate  
          whether they would like assistance from an agent or enrollment  
          counselor, and prohibits the Exchange from disclosing personal  
          information if applicants indicate they do not want assistance.

           FISCAL EFFECT  

          1)One-time costs of about $350,000 to modify information  
            technology systems by Covered California to allow applicants  
            to indicate whether they would like assistance (federal  
            funds/special fund).

          2)Potential minor costs to revise paper applications for health  
            care coverage by the Department of Health Care Services  
            (General Fund and federal funds). The state uses a single  
            paper application for the Medi-Cal program and coverage  
            through Covered California. In order to comply with the  
            requirements of this bill, DHCS would likely need to update  
            the paper application to opt out of future contacts. The costs  
            to do so are not expected to be significant.

           COMMENTS  

           1)Purpose . The author contends Covered California recently  
            violated the reasonable expectation of consumer privacy by  
            sharing personally identifiable information with insurance  
            companies without the express consent of consumers.  The  
            author argues this bill is necessary to consumers from  








                                                                  SB 974
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            unauthorized disclosure of their data for purposes of health  
            insurance marketing.   

          2)Rationale for Urgency  . This bill states, "Protecting  
            Californians' privacy rights is of the utmost importance, and  
            in order to protect the privacy rights of individuals applying  
            for health care coverage through the California Health Benefit  
            Exchange at the earliest possible time, it is necessary that  
            this act take effect immediately."  This bill includes an  
            operative date of October 1, 2014 in order to be effective by  
            the annual open enrollment period for health insurance  
            coverage through the Exchange in 2015.

           Analysis Prepared by  :    Lisa Murawski / APPR. / (916) 319-2081