California Assembly Bill AB2396 Amended / Bill

 BILL NUMBER: AB 2396AMENDED BILL TEXT AMENDED IN SENATE AUGUST 2, 2010 AMENDED IN SENATE JUNE 28, 2010 AMENDED IN SENATE JUNE 21, 2010 AMENDED IN ASSEMBLY MAY 12, 2010 AMENDED IN ASSEMBLY APRIL 8, 2010 INTRODUCED BY Assembly Member Solorio FEBRUARY 19, 2010 An act to amend  Section 11751.5   Sections 11751.5 and 11752.7  of the Insurance Code, relating to workers' compensation insurance. LEGISLATIVE COUNSEL'S DIGEST AB 2396, as amended, Solorio. Workers' compensation insurance: rating organizations: statistical agent.  Existing   (1)     Existing  law requires the Insurance Commissioner to designate a licensed rating organization, as defined, as his or her statistical agent to gather and compile workers' compensation insurers' loss and expense experience statistics, and all licensed rating organizations are required to report loss and expense experiences of their member workers' compensation insurers to the statistical agent. Subject to reasonable rules approved by the commissioner, the statistical agent is required to make available those compiled experience statistics to all licensed rating organizations. The statistical agent is authorized to make a reasonable charge to other ratings organizations for the expense incurred by it in combining, tabulating, and compiling the experience of all workers' compensation insurers. This bill would require a  designated  statistical agent to conduct public meetings, as provided, would specify records of the  designated  statistical agent that are public, and would specify information  prohibited from being considered a public record   that the designated statistical agent is not required to make available to the public  .  (2) Existing law requires a licensed rating organization to make experience rating information contained in its records available to any insurer, insurance agent, or broker that is admitted or licensed to transact workers' compensation insurance in this state. Existing law prohibits a licensed rating organization from entering into an agreement, as specified, that prohibits information services companies in the business of publishing or providing experience rating information immediately prior to September 15, 1989, from continuing to receive and provide experience rating information.   This bill would require a rating organization to provide experience rating information, by electronic means, directly to information service providers in the business of publishing or providing experience rating information immediately prior to September 15, 1989, or to advisory organizations, as defined, on a timely basis, as provided. This bill would require a licensed rating organization to make experience rating information contained in its records available to any information services company that is engaged in furnishing workers' compensation information to insurers, insurance agents, and insurance brokers, admitted or licensed to transact workers' compensation insurance in this state, as provided.  Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 11751.5 of the Insurance Code is amended to read: 11751.5. (a) The commissioner, after notice and hearing, may promulgate reasonable rules and statistical plans, which may be modified from time to time and which shall be used thereafter in the recording and reporting by insurers of their loss and expense experience in order that the experiences of all insurers may be made available in such form and detail as may be necessary to aid the commissioner in administering the provisions of Article 2 (commencing with Section 11730). (b) The commissioner shall designate a rating organization licensed under this article as his or her statistical agent to gather and compile such experience statistics and all licensed rating organizations shall report the experience of their members to such designated rating organization. Subject to reasonable rules approved by the commissioner, such designated rating organization shall make such experience statistics, when compiled, available to all licensed rating organizations and may make a reasonable charge to other rating organizations for the expense incurred by it in combining, tabulating and compiling the experience of all workers' compensation insurers. (c) (1) The  designated  statistical agent shall conduct  public  meetings  , that are open to the public,  with regard to all issues involving pure premium rates, classifications, rating plans, rating systems, manual rules, and policy and endorsement forms that are properly brought before it in any of its committees. This shall apply to meetings conducted in person and via teleconference.  Attendance at telephonically conducted meetings by members of the public shall be made available by the publication by the organization   With respect to meetings held by telephone conference, the designated statistical agent shall,  in its meeting notices as set forth below  of   , publish  a call-in number and passcode that members of the public may use to participate in the meeting.  Members of the public shall be allowed to electronically record the proceedings of these meetings.  (2) As used in this section, "meeting" includes any congregation  of a majority of the members of any committee that handles the issues set forth in paragraph (1), as applicable, at the same time to hear, discuss, or deliberate upon any of those issues.   at which the issues set forth in paragraph (1) are being heard, discussed, or deliberated if a majority of the members of any committee are present.  Notwithstanding the foregoing, a meeting shall not include any of the following: (A) Individual contacts or conversations between a member of any committee and any other person, including, but not limited to, any employee or official of the organization that does not violate this subdivision. (B) The attendance of a majority of the members of any committee at an industry conference or other gathering  organized by a person or organization other than the statistical agent  , provided that a majority of the members do not discuss among  themselves any item that is within the responsibility of the statistical agent as set forth in this article.   themselves any item that is set forth in paragraph (1).  (C) The attendance of a majority of the members of any committee at a purely social or ceremonial occasion, provided that a majority of the members do not discuss among themselves any item that is within the responsibility of the  designated  statistical agent as set forth in this article. (3) (A) A majority of the members of any committee of the  designated  statistical agent shall not, outside a meeting authorized by this  article   subdivision  , use a series of communications of any kind, directly or through intermediaries, to  discuss, deliberate,   deliberate  or take action on  any item of business that is within the responsibility of the statistical agent as set forth in this article.   any issue set forth in paragraph (1).  (B) Subparagraph (A) shall not be construed as preventing any employee or officer of the  designated  statistical agent from engaging in separate conversations or communications outside of a meeting  authorized by this article   duly noticed by the designated statistical agent  with members of any of its committees in order to answer questions or provide information regarding  matters within the responsibility of the statistical agent, if that person does not communicate to members of any of the committees of the board of governors the comments or position of any other member or members of the committees.   any issue set forth in paragraph (1) if that person does not communicate to other members of the committees or the board of governors the comments or positions of any other committee or board member.  (d) All meetings of the  designated  statistical agent  authorized under this article   that are open to the public pursuant to subdivision (c)  shall comply with the protections and prohibitions contained in Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in implementation of that act. (e) (1) The  designated  statistical agent shall provide notice of its meetings that are open  and   to the  public pursuant to subdivision (c). This notice and an agenda of items to be discussed shall be provided at least 10 days in advance of the meeting via the  designated  statistical agent's Internet Web site. In addition, members of the public may request notice by regular mail or by e-mail by making a written request to the  designated  statistical agent for notice of meetings that are open  and   to the  public pursuant to subdivision (c). (2) Notice may be waived or the 10-day period modified, with respect to any particular meeting,  by the statistical agent' s governing committee or board  upon a request submitted to the commissioner stating the need for a modified notice and exigent circumstances requiring waiver of the notice requirement, at least 24 hours in advance of the meeting time set. The approval of the commissioner shall be deemed granted if a written denial of the request for waiver or modification of the notice period is not received  at least   within 24 hours following the request or  four hours prior to the commencement of the meeting to be conducted under the modified notice  , whichever occurs first  . (3) Notice of a meeting that does not meet the 10-day notice requirement under this subdivision shall be posted on the  designated  statistical agent's Internet Web site and provided by e-mail to members of the public who have made a written request for e-mail notice to the statistical agent of meetings that are open  and   to the  public pursuant to subdivision (c). A summary agenda shall be included in each such notice, but members of any committee may bring additional items of business to any such meeting. (f) At any meeting where notice is required pursuant to this section, the  designated  statistical agent shall reserve time for public comment on the issues  addressed at the meeting   set forth in subdivision (c)  . (g) Nothing in this section shall be construed to prohibit the committees of the  designated  statistical agent from holding a closed meeting or a closed session of  an open and public meeting   a meeting that is open to the public pursuant to subdivision (c)  to discuss any of the following subjects: (1) Financial, operational, or personnel information or matters  related to the   of the designated  statistical agent. (2) Nonpublic financial, operational, or personnel information or matters of member insurers of the  designated  statistical agent. (3) Nonpublic information received from  regulators   or provided to the commissioner  regarding the  designated  statistical agent or members of the  designated  statistical agent. (4) Statutory interpretations and other advice received from legal counsel to the  designated  statistical agent, whether in connection with litigation or otherwise. (5) Appointment, employment, evaluation of performance, or dismissal of any employee or vendor that provides products and services  in connection with the operations of the   to the designated  statistical agent. (6)  Deliberations concerning the   The  purchase, sale, exchange, or lease of real or personal property  , including investment property  . (7) Matters posing a threat of criminal or terrorist activity against the  designated  statistical agent, its personnel, or its property. (8) Legal  , legislative, or regulatory   or legislative  matters of the  designated  statistical agent, whether potential, pending, or actual  , that are unrelated to the issues in paragraph (1) of subdivision (c)  . (9) Disputes and purported disputes with or involving members of the  designated  statistical agent.  (10) Disciplinary matters involving a specific member of the designated statistical agent.   (11) Use of an employer's self-insured data in an experience rating.   (10)   (12)  Any other matters as permitted by order or regulation of the commissioner. (h) With respect to any closed meeting or session held as permitted by subdivision (g), the  designated  statistical agent shall do both of the following: (1) Disclose, prior to the closed meeting or the closed session, the general nature of the item or items to be discussed in the closed session. The disclosure may take the form of a reference to the item or items as they are listed by number or letter on the agenda. In the closed session, the committee may consider only those matters covered in its disclosure. After any closed session, the committee shall reconvene in open session prior to adjournment and shall make any reports, provide any documentation, or make any other disclosures that may be required consistent with  this article   subdivision (c), except with respect to confidential legal or legislative matters directly related to the designated statistical agent  . The announcements required to be made in open session pursuant to this subdivision may be made at the location announced in the agenda for the closed session, as long as the public is allowed to be present at that location for the purpose of hearing the announcement. (2) Provide reports to the commissioner identifying the matters covered in each such closed meeting or session and the provisions of subdivision (g) pursuant to which the subject was discussed. (i) Nothing in this section shall require or authorize the disclosure of names or other information that would constitute an invasion of privacy or otherwise unnecessarily divulge the particular facts concerning the closed session or the disclosure of which is prohibited by state or federal law. (j) The commissioner or his or her designated representative shall be permitted to attend all meetings of the statistical agent, specifically including closed meetings and sessions. Any information discussed in closed meetings or sessions shall be treated by the commissioner and his or her designated representatives as confidential pursuant to the provisions of Section 12919. (k) Records of a  designated  statistical agent that shall be  considered public records and that shall be  made available to the public for purchase for the direct costs of duplication  , either in hard copy or electronic form, at the discretion of the requestor,  include, but are not limited to, all of the following:  (1) Information releases, including bulletins, general notices, all committee meeting agendas, and minutes, except for items expressly excluded by statute, in which case the item shall be generally identified, and the reason for the exclusion expressed in writing.   (2) Information or materials provided to the department as part of or in support of a rating filing.   (3) Actuarial assumptions and calculations made in the course of ratemaking.   (4) Aggregate data, comprised of data from multiple carriers, which is used in the ratemaking process.   (5) Aggregate data provided to statistical agent members or others, including classification experience data and aggregate payroll data.   (6) Material made available free on the rating statistical agent's Internet Web site that exists in other forms.   (1) Bulletins and notices with respect to the issues set forth in paragraph (1) of subdivision (c).   (2) Agendas and minutes for meetings that are open to the public pursuant to subdivision (c), describing generally, without any identifying information with regard to a specific insurer or employer, the items to be discussed in closed session pursuant to subdivision (g).   (3) Information or materials provided to the commissioner as part of, or in support of, a rating filing, except when the information relates to a specific insurer or when the commissioner designates the information as confidential.   (4) Actuarial assumptions and calculations used to support the designated statistical agent's recommendations to any committee with respect to the issues set forth in paragraph (1) of subdivision (c).   (5) Summaries of aggregate data, comprised of data from multiple carriers, which are used to support the designated statistical agent' s recommendations to any committee with respect to the issues set forth in paragraph (1) of subdivision (c).  (7)   (6)  Manuals, plans, and classification information, including codes, materials, books,  manuals,  or pamphlets  , that outline or delineate the rules or regulations of the workers' compensation system.   with respect to issues set forth in paragraph (1) of subdivision (c).   (8) Studies or reports created as a result of statute or request of the department, the Legislature, or any other governmental body, except to the extent that the department designates a requested report or study as nonpublic.   (9) Materials used in classes or training for licensees of the department or the public.   (l) All of the following information, if applicable based on the facts of the particular case, in the possession of a statistical agent shall not be considered a public record:   (1) Aggregate data from an individual insurer.   (7) Studies or reports created as a result of a statute or at the request of the commissioner or Legislature, except to the extent that the commissioner designates a requested report or study as being confidential or it includes information that is specific to a single insurer or employer.   (l) The designated statistical agent shall not be required to make available to the public any personal, proprietary, confidential, or trade secret information in its possession, including, but not limited to:   (1) Data, including aggregate data, submitted by an individual insurer.  (2) Claims  , employers, or policies  data relating to individual claims. (3) Payroll data relating to an individual employer  or policy  .  (4) Medical data relating to an individual injured worker, employer, or policy.   (4)  (5)  Data relating to active investigations by the  designated  statistical agent of a member or members initiated by the statistical agent, the commissioner, or other law enforcement agency  , unles   s authorized by the commissioner .  SEC. 2.   Section 11752.7 of the   Insurance Code   is amended to read:  11752.7. (a) A licensed rating organization may make available experience rating information contained in its records to any insurer admitted to transact workers' compensation insurance in this state or to any insurance agent or broker that is licensed to transact workers' compensation insurance in this state, if the insurer, agent, or broker submits a written request to the licensed rating organization stating all of the following: (1) The requesting insurer is admitted to transact workers' compensation insurance in this state or that the requesting agent or broker is licensed to transact workers' compensation insurance in this state. (2) The information requested. (3) The information requested will be used to facilitate the transaction of workers' compensation insurance by the insurer, agent, or broker. (4) The information received will not be released by the agent or broker to others, except to facilitate the transaction of workers' compensation insurance by the requesting agent or broker. (b) The licensed rating organization may, but shall not be required to, verify that an insurer requesting information under this section is admitted to transact workers' compensation insurance in this state or that an insurance agent or broker requesting information under this section is licensed to transact workers' compensation insurance in this state. (c) For purposes of this section: (1) "Experience rating information" means information released on microfiche, at an Internet Web site or other electronic format, or in other forms or media by a licensed rating organization that identifies all experience-rated employers, and the experience ratings and classifications or experience modifications that apply or applied to those employers. (2) "Transaction," as applied to workers' compensation insurance, includes any of the following: (A) Solicitation. (B) Negotiations preliminary to execution of a contract of insurance. (C) Execution of a contract of insurance. (D) Resolution of matters arising out of the contract and subsequent to its execution. (d) Experience rating information made available pursuant to this section shall be confidential and shall not be used for any purpose other than to facilitate the transaction of workers' compensation insurance by the insurer, agent, or broker receiving the information pursuant to this section. (e)  (1)    Notwithstanding any other provision of law, including this section, a licensed rating organization  may   shall  not enter into a contract or other agreement, including its constitution, articles of incorporation, or bylaws that prohibits information services companies in the business of publishing or providing experience rating information immediately prior to September 15, 1989, from continuing on or after September 15, 1989, to receive and provide to others experience rating information from whatever sources and in whatever forms or media.  Upon request, a rating organization shall provide experience rating information, by electronic means, directly to information services providers described in this paragraph, or to advisory organizations as defined in subdivision (e) of Section 11750.1, on a timely basis, consistent with its own releases or updates. A rating organization shall provide this information at a cost no greater than the direct cost of duplication.   (2) A licensed rating organization shall make experience rating information contained in its records available to any information services company that is engaged in furnishing workers' compensation information to insurers admitted to transact workers' compensation insurance in this state or to insurance agents or brokers licensed to transact workers' compensation insurance in this state. The licensed rating organization shall provide this information to the information services company by electronic or other means, if the information services company submits a written statement to the licensed rating organization stating all of the following:  (A) The information services company is engaged in furnishing information to workers compensation insurers admitted to transact workers' compensation insurance in this state or to insurance agents or brokers licensed to transact workers' compensation insurance in this state.  (B) The information requested.   (C) The information services company shall furnish any information provided by the licensed rating organization, including experience rating information, only to insurers, brokers, or agents, for the purpose of transacting workers' compensation insurance in this state.   (3) The information services company shall notify the licensed rating organization within 20 days of the date on which it ceases or withdraws from furnishing experience rating information to insurers, agents, or brokers transacting workers' compensation insurance in this state.  (f) No licensed rating organization, member of a licensed rating organization, member of a committee of a licensed rating organization when acting in its capacity as a member of the committee, or officer or employee of a licensed rating organization when acting within the scope of his or her employment, shall be liable to any person for injury, personal or otherwise, or damages caused or alleged to have been caused, either directly or indirectly, by the disclosure of information pursuant to this section, or to the members of those organizations, or for the accuracy or completeness of the information disclosed. (g) This section shall not be construed as implying the existence of liability in circumstances not defined in this section, nor as implying a legislative recognition that, except for the enactment of this section, a liability has existed or would exist in the circumstances stated in this section. (h) This section shall not be construed as limiting any authority of a licensed rating organization to disclose information contained in its records to others.