California Assembly Bill AB792 Amended / Bill

 BILL NUMBER: AB 792AMENDED BILL TEXT AMENDED IN ASSEMBLY APRIL 14, 2011 INTRODUCED BY Assembly Member Bonilla FEBRUARY 17, 2011 An act to add Sections 2024.7 and 8613.7 to the Family Code, to add Sections 1366.50 and 1366.51 to the Health and Safety Code, to add Sections 10786 and 10787 to the Insurance Code, to amend Section 2800.2 of the Labor Code, and to add Sections 1342.5 and 2706.5 to the Unemployment Insurance Code, relating to health care coverage. LEGISLATIVE COUNSEL'S DIGEST AB 792, as amended, Bonilla. Health care coverage: California Health Benefit Exchange. Existing law, the federal Patient Protection and Affordable Care Act, requires each state to, by January 1, 2014, establish an American Health Benefit Exchange that makes available qualified health plans to qualified individuals and employers. Existing state law establishes the California Health Benefit Exchange within state government, specifies the powers and duties of the board governing the Exchange relative to determining eligibility for enrollment in the Exchange and arranging for coverage under qualified health plans, 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. Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law provides for the regulation of health insurers by the Department of Insurance. Existing law imposes specified requirements on health care service plans and health insurers that provide medical and hospital coverage under an employer-sponsored group plan for an employer  or employee association  subject to  requirements under  COBRA or Cal-COBRA, as defined  , and imposes specified requirements on those employers or employee associations to notify its current and former employees or members and dependents of continuation coverage and conversion coverage options upon specified events  . Existing law regulates the distribution of unemployment compensation or disability benefits by the Employment Development Department. Existing law, under the Family Code, sets forth procedures related to a petition for dissolution of marriage, nullity of marriage, or legal separation, or a petition for adoption. This bill would require the disclosure of information on health care coverage through the California Health Benefit Exchange, under specified circumstances, by health care service plans, health insurers,  employers, employee associations,  the Employment Development Department, upon an initial claim for disability benefits, or by the court, upon the filing of a petition for dissolution of marriage, nullity of marriage, legal separation, or adoption.  On   On  and after January 1, 2014,  the   this  bill would also require specified health care service plans and health insurers to, upon  a renewal in coverage   the failure  of an enrollee or insured  to renew his or her health coverage  , as specified, or  with regard to COBRA or Cal-COBRA   upon termination of  coverage under an employer-sponsored group plan, and the Employment Development Department with regard to an applicant for unemployment compensation, provide specified information to the California Health Benefit Exchange for purposes of enrolling those  enrollees, insureds,   individuals  or applicants in the Exchange.  The bill would make the automatic enrollment of those individuals in the Exchange subject to the plan or insurer, or employer or employee association, obtaining the consent of the individual at the time the individual or employer-sponsored group plan contract or policy is issued, amended, delivered, or renewed, as specified. The bill would make the automatic enrollment of those individuals by the Employment Development Department subject to the Exchange receiving approval from the United States Department of Health and Human Services to transfer the minimum information necessary to initiate an application for enrollment, as specified.  The bill would allow an individual  who is enrolled in the Exchange under those provisions  to opt out of that coverage in writing to the Exchange  , as specified  . Because a willful violation of the bill's provisions relative to health care service plans would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 2024.7 is added to the Family Code, to read: 2024.7. Upon the filing of a petition for dissolution of marriage, nullity of marriage, or legal separation, the court shall provide to the petitioner and the respondent the following notice: "If you do not have affordable health care coverage, effective January 1, 2014, you may obtain health care coverage through the California Health Benefit Exchange. What you pay for coverage through the Exchange will depend on how much you make. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." SEC. 2. Section 8613.7 is added to the Family Code, to read: 8613.7. Upon the filing of a petition for adoption pursuant to this part, the court shall provide to the petitioner the following notice: "If you do not have affordable health care coverage, effective January 1, 2014, you may obtain health care coverage through the California Health Benefit Exchange. What you pay for coverage through the Exchange will depend on how much you make. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." SEC. 3. Section 1366.50 is added to the Health and Safety Code, to read: 1366.50. (a) Except for a specialized health care service plan, every health care service plan contract that is issued, amended, delivered, or renewed in this state on or after January 1, 2014, that provides medical and hospital coverage under an employer-sponsored group plan for an employer subject to COBRA, as defined in subdivision (e) of Section 1373.621, or an employer group for which the plan is required to offer Cal-COBRA coverage, as defined in subdivision (f) of Section 1373.621, including a carrier providing replacement coverage under Section 1399.63, shall further offer the former employee or former dependent of an employee the opportunity to continue benefits as required under subdivision (b), and shall further offer the former employee or former dependent of an employee the opportunity to continue benefits as required under subdivision (b).  At the time that the health care service plan contract is issued, amended, delivered, or renewed on or after January 1, 2012, the health care service plan shall obtain the consent of the enrollee to provide the minimum necessary information to the Exchange in the event that the individual or dependent ceases to be enrolled in coverage under an employer-sponsored group plan.  (b) (1) The health care service plan shall provide to the California Health Benefit Exchange information regarding the former employee and any dependents covered under the group coverage. The information provided shall include the name or names, most recent address, and any other information that is in the possession of the plan and that the Exchange may require in a manner to be prescribed by the Exchange. (2) The information shall  constitute   initiate an application for enrollment in coverage within the meaning of Section 100503 of the Government Code.  (c) (1) On and after January 1, 2012, until December 31, 2013, notification provided to employees, members, former employees, spouses, or former spouses under subdivisions (a) and (b) shall also include the following notification:   "Please examine your options carefully before declining this coverage. Until January 1, 2014, you should be aware that companies selling individual health insurance to adults who are 19 years of age or older typically require a review of your medical history that could result in a higher premium or you could be denied coverage entirely. Effective January 1, 2010, children under 19 years of age cannot be denied individual coverage based on medical history, but may pay a higher premium depending on medical history."   (c) (1)   (2)    On and after January 1, 2014, notification provided to employees, members, former employees, dependents, or former dependents under subdivisions (a) and (b) shall also include the following notification in 12-point type: "Because you are no longer enrolled in coverage provided by your employer or the employer of a family member, an application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. Your payment for this coverage will be based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)."  (2)   (3)    To decline health care coverage  from the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing within 63 calendar days of the date of termination of group coverage. SEC. 4. Section 1366.51 is added to the Health and Safety Code, to read: 1366.51. (a) Except for a specialized health care service plan, every health care service plan contract that is issued, amended, delivered, or renewed in this state on or after January 1, 2014, that provides medical and hospital coverage to an individual shall further offer notice 60 days in advance of renewal  , amendment, or any change in rate  of the opportunity to continue benefits as required under subdivision (b), and shall further offer the individual or former dependent of an individual the opportunity to continue benefits as required under subdivision (b).  At the time that the   health care service plan contract is issued, amended, delivered, or renewed on or after January 1, 2012, the health care service plan shall obtain the consent of the enrollee to provide the minimum necessary information to the Exchange in the event that the individual or dependent ceases to be enrolled in individual coverage.  (b) (1) The health care service plan shall provide to the California Health Benefit Exchange information regarding the former covered individual and any dependents that chose not to renew individual coverage. The information provided shall include the name or names, most recent address, and any other information that is in the possession of the plan and that the Exchange may require in a manner to be prescribed by the Exchange. (2) The information shall  constitute   initiate  an application for enrollment in coverage within the meaning of Section 100503 of the Government Code. (c) (1) On and after January 1, 2014, notification provided to  employees, members, former employees   individuals  , dependents, or former dependents under subdivisions (a) and (b) shall also include the following notification in 12-point type: "Because you are no longer enrolled in coverage purchased by you as an individual or as the dependent of a family member, an application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. Your payment for coverage will be based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." (2) To decline health care coverage  from the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing within 63 calendar days of the date of termination of individual coverage. SEC. 5. Section 10786 is added to the Insurance Code, to read: 10786. (a) Every health insurance policy that is issued, amended, delivered, or renewed in this state on or after January 1, 2014, that provides medical and hospital coverage under an employer-sponsored group plan for an employer subject to COBRA, as defined in subdivision (e) of Section 10116.5, or an employer group for which the plan is required to offer Cal-COBRA coverage, as defined in subdivision (f) of Section 10116.5, including a carrier providing replacement coverage under Section 10128.3, shall further offer the former employee or former dependent of an employee the opportunity to continue benefits as required under subdivision (b), and shall further offer the former employee or former dependent of an employee the opportunity to continue benefits as required under subdivision (b).  At the time that the health insurance policy is issued, amended, delivered, or renewed on or after January 1, 2012, the health insurer shall obtain the consent of the insured to provide the minimum necessary information to the Exchange in the event that the individual or dependent ceases to be enrolled in coverage under an employer-sponsored group plan.  (b) (1) The health insurer shall provide to the California Health Benefit Exchange information regarding the former employee and any dependents covered under the group coverage. The information provided shall include the name or names, most recent address, and any other information that is in the possession of the insurer and that the Exchange may require in a manner to be prescribed by the Exchange. (2) The information shall  constitute   initiate  an application for enrollment in coverage within the meaning of Section 100503 of the Government Code.  (c) (1) On and after January 1, 2012, until December 31, 2013, notification provided to employees, members, former employees, spouses, or former spouses under subdivisions (a) and (b) shall also include the following notification:   "Please examine your options carefully before declining this coverage. Until January 1, 2014, you should be aware that companies selling individual health insurance to adults who are 19 years of age or older typically require a review of your medical history that could result in a higher premium or you could be denied coverage entirely. Effective January 1, 2010, children under 19 years of age cannot be denied individual coverage based on medical history, but may pay a higher premium depending on medical history."   (c) (1)   (2)    On and after January 1, 2014, notification provided to employees, members, former employees, dependents, or former dependents under subdivisions (a) and (b) shall also include the following notification in 12-point type: "Because you are no longer enrolled in coverage provided by your employer or the employer of a family member, an application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. Your payment for this coverage will be based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)."  (2)   (3)    To decline health care coverage  from the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing within 63 calendar days of the date of termination of group coverage. SEC. 6. Section 10787 is added to the Insurance Code, to read: 10787. (a) Every health insurance policy that is issued, amended, delivered, or renewed in this state on or after January 1, 2014, that provides medical and hospital coverage to an individual shall further offer notice 60 days in advance of renewal  , amendment, or any change in rate  of the opportunity to continue benefits as required under subdivision (b), and shall further offer the individual or former dependent of an individual the opportunity to continue benefits as required under subdivision (b).  At the time that the health insurance policy is issued, amended, delivered, or renewed   on or after January 1, 2012, the health insurer shall obtain the consent of the insured to provide the minimum necessary information to the Exchange in the event that the individual or dependent ceases to be enrolled in individual coverage.  (b) (1) The health insurer shall provide to the California Health Benefit Exchange information regarding the former covered individual and any dependents that chose not to renew individual coverage. The information provided shall include the name or names, most recent address, and any other information that is in the possession of the insurer and that the Exchange may require in a manner to be prescribed by the Exchange. (2) The information shall  constitute   initiate  an application for enrollment in coverage within the meaning of Section 100503 of the Government Code. (c) (1) On and after January 1, 2014, notification provided to  employees, members, former employees   individuals  , dependents, or former dependents under subdivisions (a) and (b) shall also include the following notification in 12-point type: "Because you are no longer enrolled in coverage purchased by you as an individual or as the dependent of a family member, an application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. Your payment for coverage will be based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." (2) To decline health care coverage  from the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing within 63 calendar days of the date of termination of individual coverage. SEC. 7. Section 2800.2 of the Labor Code is amended to read: 2800.2. (a) Any employer, employee association, or other entity otherwise providing hospital, surgical, or major medical benefits to its employees or members is solely responsible for notification of its employees or members of the conversion coverage made available pursuant to Part 6.1 (commencing with Section 12670) of Division 2 of the Insurance Code or Section 1373.6 of the Health and Safety Code.  At the time that the health care service plan contract or health insurance policy is issued, amended, delivered, or renewed on or after January 1, 2012, the employer, employee association, or other entity shall obtain the consent of the enrollee or insured to provide the   minimum necessary information to the Exchange in the event that the individual or dependent ceases to be enrolled in coverage under this section.  (b) Any employer, employee association, or other entity, whether private or public, that provides hospital, medical, or surgical expense coverage that a former employee may continue under Section 4980B of Title 26 of the United States Code, Section 1161 et seq. of Title 29 of the United States Code, or Section 300bb of Title 42 of the United States Code, as added by the Consolidated Omnibus Budget Reconciliation Act of 1985 (Public Law 99-272), and as may be later amended (hereafter "COBRA"), shall, in conjunction with the notification required by COBRA that COBRA continuation coverage will cease and conversion coverage is available, and as a part of the notification required by subdivision (a), also notify the former employee, spouse, or former spouse of the availability of the continuation coverage under Section 1373.621 of the Health and Safety Code  ,  and Sections 10116.5 and 11512.03 of the Insurance Code. (c) (1) On or after July 1, 2006, until January 1, 2012, notification provided to employees, members, former employees, spouses, or former spouses under subdivisions (a) and (b) shall also include the following notification: "Please examine your options carefully before declining this coverage. You should be aware that companies selling individual health insurance typically require a review of your medical history that could result in a higher premium or you could be denied coverage entirely." (2) On and after January 1, 2012, until December 31, 2013, notification provided to employees, members, former employees, spouses, or former spouses under subdivisions (a) and (b) shall also include the following notification: "Please examine your options carefully before declining this coverage. Until January 1, 2014, you should be aware that companies selling individual health insurance to adults who are 19 years of age or older typically require a review of your medical history that could result in a higher premium or you could be denied coverage entirely. Effective January 1, 2010, children under 19 years of age cannot be denied individual coverage based on medical history but may pay a higher premium depending on medical history." (3) On and after January 1, 2014, notification provided to employees, members, former employees, spouses, or former spouses under subdivisions (a) and (b) shall also include the following notification: "Because you are no longer enrolled in coverage  purchased by you as an individual or as the dependent of a family member, an   , an  application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. You will be charged for Exchange coverage based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." (d) To decline health care coverage  through the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing within 63 calendar days of the date of termination of individual coverage. SEC. 8. Section 1342.5 is added to the Unemployment Insurance Code, to read: 1342.5. (a) On and after January 1, 2014, when an individual files a new claim for unemployment compensation under this chapter, the department shall do all of the following: (1) (A) Provide to the California Health Benefit Exchange the name, address, and any other identifying information that is in the possession of the department as the Exchange may require in a manner to be prescribed by the Exchange.  To maximize the number of individual Californians complying with the requirements of the federal Patient Protection and Affordable Care Act (Public Law 111-148) by obtaining coverage consistent with the   provisions of federal law, the Exchange shall seek approval from the United States Department of Health and Human Services to transfer the minimum information necessary to initiate an application for enrollment under this section consistent with Section 100503 of the Government Code.  (B) The information shall  constitute   initiate  an application for enrollment in coverage within the meaning of Section 100503 of the Government Code. (b) Provide the following notice to the individual: "Because you have applied for unemployment compensation, an application for health care coverage through the California Health Benefit Exchange has been made for you. You are not required to accept coverage from the Exchange. You will be charged for Exchange coverage based on your income last year. If you make significantly less or more this year than you made last year, please tell the California Health Benefit Exchange and your charges will be based on your current income. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." (c) To decline health care coverage  through the Exchange  pursuant to this section, the individual shall elect to do so by notifying the Exchange in writing. SEC. 9. Section 2706.5 is added to the Unemployment Insurance Code, to read: 2706.5. (a) When an individual files a new claim for disability benefits under this part, the department shall provide the following notice to the individual: "If you do not have affordable health care coverage, effective January 1, 2014, you may obtain health care coverage through the California Health Benefit Exchange. What you pay for coverage through the Exchange will depend on how much you make. If your income is low, you may qualify for no-cost coverage through Medi-Cal. For more information, check www.healthcare.ca.gov or call 1-888-Healthhelp (insert telephone number)." (b) This notice shall be provided upon initial application whether or not the individual is eligible for disability benefits. SEC. 10. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.