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| 1 | + | Amended IN Assembly March 23, 2018 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Assembly Bill No. 2416Introduced by Assembly Member Wood(Coauthors: Assembly Members Arambula, Burke, Chiu, and Friedman)February 14, 2018 An act to amend Section 1365 of add Section 1360.7 to the Health and Safety Code, relating to health care coverage. LEGISLATIVE COUNSEL'S DIGESTAB 2416, as amended, Wood. Health care coverage.Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacted various health care coverage market reforms that took effect on January 1, 2014. PPACA required each state, by January 1, 2014, to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange, also known as Covered California, to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans.Existing law requires a health care service plan, on and after October 1, 2013, to offer, market, and sell all of the plans health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in a service area in which the plan provides or arranges for the provision of health care services.This bill would require a health care service plan that has a contract with the State Department of Health Care Services to offer Medi-Cal managed care plans or prepaid health plans, or a Program of All-Inclusive Care for the Elderly (PACE) organization contract with the department, to negotiate with Covered California regarding offering individual products on the Exchange in approved service areas that overlap with counties where there are 2 or fewer health care service plans offering products on the Exchange, as specified. Because a willful violation of the bills requirements 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.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law prohibits the cancellation or nonrenewal of individual or group health benefit plans by a health care service plan except in specified circumstances.This bill would make technical, nonsubstantive changes by deleting obsolete provisions.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NOYES Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read:1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018.SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.SECTION 1.Section 1365 of the Health and Safety Code is amended to read:1365.(a)An enrollment or a subscription shall not be canceled or not renewed except for the following reasons:(1)(A)For nonpayment of the required premiums by the individual, employer, or contractholder if the individual, employer, or contractholder has been duly notified and billed for the charge and at least a 30-day grace period has elapsed since the date of notification or, if longer, the period of time required for notice and any other requirements pursuant to Section 2703, 2712, or 2742 of the federal Public Health Service Act (42 U.S.C. Secs. 300gg-2, 300gg-12, and 300gg-42) and any subsequent rules or regulations has elapsed.(B)Pursuant to subparagraph (A), a health care service plan shall continue to provide coverage as required by the individuals, employers, or contractholders health care service plan contract during the period described in subparagraph (A).(2)The plan demonstrates fraud or an intentional misrepresentation of material fact under the terms of the health care service plan contract by the individual contractholder or employer.(3)In the case of an individual health care service plan contract, the individual subscriber no longer resides, lives, or works in the plans service area, but only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.(4)In the case of a group health care service plan contract, violation of a material contract provision relating to employer contribution or group participation rates by the contractholder or employer.(5)If the plan ceases to provide or arrange for the provision of health benefits for new health care service plan contracts in the individual or group market, or all markets, in this state, provided, however, that the following conditions are satisfied:(A)Notice of the decision to cease new or existing health benefit plans in the state is provided to the director, the individual or group contractholder or employer, and the enrollees covered under those contracts, at least 180 days prior to discontinuation of those contracts.(B)Health benefit plans shall not be canceled for 180 days after the date of the notice required under subparagraph (A) and, for that business of a plan that remains in force, any plan that ceases to offer for sale new health benefit plans shall continue to be governed by this section with respect to business conducted under this section.(C)Except as authorized under subdivision (b) of Section 1357.09 and Section 1357.10, a plan that ceases to write new health benefit plans in the individual or group market, or all markets, in this state shall be prohibited from offering for sale health benefit plans in that market or markets in this state for a period of five years from the date of the discontinuation of the last coverage not so renewed.(6)If the plan withdraws a health benefit plan from the market, provided that all of the following conditions are satisfied:(A)The plan notifies all affected subscribers, contractholders, employers, and enrollees and the director at least 90 days prior to the discontinuation of the plan.(B)The plan makes available to the individual or group contractholder or employer all health benefit plans that it makes available to new individual or group business, respectively.(C)In exercising the option to discontinue a health benefit plan under this paragraph and in offering the option of coverage under subparagraph (B), the plan acts uniformly without regard to the claims experience of the individual or contractholder or employer, or any health status-related factor relating to enrollees or potential enrollees.(7)In the case of a group health benefit plan, if an individual or employer ceases to be a member of a guaranteed association, as defined in subdivision (n) of Section 1357, but only if that coverage is terminated under this paragraph uniformly without regard to any health status-related factor relating to any enrollee.(b)(1)An enrollee or subscriber who alleges that an enrollment or subscription has been or will be improperly canceled, rescinded, or not renewed may request a review by the director pursuant to Section 1368.(2)If the director determines that a proper complaint exists, the director shall notify the plan and the enrollee or subscriber who requested the review.(3)If, after review, the director determines that the cancellation, rescission, or failure to renew is contrary to existing law, the director shall order the plan to reinstate the enrollee or subscriber. Within 15 days after receipt of that order, the health care service plan shall request a hearing or reinstate the enrollee or subscriber.(4)If an enrollee or subscriber requests a review of the health care service plans determination to cancel or rescind or failure to renew the enrollees or subscribers health care service plan contract pursuant to this section, the health care service plan shall continue to provide coverage to the enrollee or subscriber under the terms of the contract until a final determination of the enrollees or subscribers request for review has been made by the director. This paragraph shall not apply if the health care service plan cancels or does not renew the enrollees or subscribers health care service plan contract for nonpayment of premiums pursuant to paragraph (1) of subdivision (a).(5)A reinstatement pursuant to this subdivision shall be retroactive to the time of cancellation, rescission, or failure to renew and the plan shall be liable for the expenses incurred by the subscriber or enrollee for covered health care services from the date of cancellation, rescission, or nonrenewal to and including the date of reinstatement. The health care service plan shall reimburse the enrollee or subscriber for any expenses incurred pursuant to this paragraph within 30 days of receipt of the completed claim.(c)This section shall not abrogate any preexisting contracts entered into prior to the effective date of this chapter between a subscriber or enrollee and a health care service plan or a specialized health care service plan, including, but not limited to, the financial liability of the plan, except that each plan shall, if directed to do so by the director, exercise its authority, if any, under those preexisting contracts to conform them to existing law.(d)As used in this section, health benefit plan means any individual or group insurance policy or health care service plan contract that provides medical, hospital, and surgical benefits. The term does not include accident only, credit, or disability income coverage, coverage of Medicare services pursuant to contracts with the United States government, Medicare supplement coverage, long-term care insurance, dental or vision coverage, coverage issued as a supplement to liability insurance, insurance arising out of workers compensation law or similar law, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and that is statutorily required to be contained in any liability insurance policy or equivalent self-insurance. | |
| 2 | 2 | ||
| 3 | - | ||
| 3 | + | Amended IN Assembly March 23, 2018 CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION Assembly Bill No. 2416Introduced by Assembly Member Wood(Coauthors: Assembly Members Arambula, Burke, Chiu, and Friedman)February 14, 2018 An act to amend Section 1365 of add Section 1360.7 to the Health and Safety Code, relating to health care coverage. LEGISLATIVE COUNSEL'S DIGESTAB 2416, as amended, Wood. Health care coverage.Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacted various health care coverage market reforms that took effect on January 1, 2014. PPACA required each state, by January 1, 2014, to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange, also known as Covered California, to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans.Existing law requires a health care service plan, on and after October 1, 2013, to offer, market, and sell all of the plans health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in a service area in which the plan provides or arranges for the provision of health care services.This bill would require a health care service plan that has a contract with the State Department of Health Care Services to offer Medi-Cal managed care plans or prepaid health plans, or a Program of All-Inclusive Care for the Elderly (PACE) organization contract with the department, to negotiate with Covered California regarding offering individual products on the Exchange in approved service areas that overlap with counties where there are 2 or fewer health care service plans offering products on the Exchange, as specified. Because a willful violation of the bills requirements 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.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law prohibits the cancellation or nonrenewal of individual or group health benefit plans by a health care service plan except in specified circumstances.This bill would make technical, nonsubstantive changes by deleting obsolete provisions.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NOYES | |
| 4 | 4 | ||
| 5 | - | ||
| 5 | + | Amended IN Assembly March 23, 2018 | |
| 6 | 6 | ||
| 7 | - | Amended IN Assembly April 26, 2018 | |
| 8 | 7 | Amended IN Assembly March 23, 2018 | |
| 9 | 8 | ||
| 10 | 9 | CALIFORNIA LEGISLATURE 20172018 REGULAR SESSION | |
| 11 | 10 | ||
| 12 | 11 | Assembly Bill No. 2416 | |
| 13 | 12 | ||
| 14 | 13 | Introduced by Assembly Member Wood(Coauthors: Assembly Members Arambula, Burke, Chiu, and Friedman)February 14, 2018 | |
| 15 | 14 | ||
| 16 | 15 | Introduced by Assembly Member Wood(Coauthors: Assembly Members Arambula, Burke, Chiu, and Friedman) | |
| 17 | 16 | February 14, 2018 | |
| 18 | 17 | ||
| 19 | - | An act to add Section 1360.7 to the Health and Safety Code, relating to health care coverage. | |
| 18 | + | An act to amend Section 1365 of add Section 1360.7 to the Health and Safety Code, relating to health care coverage. | |
| 20 | 19 | ||
| 21 | 20 | LEGISLATIVE COUNSEL'S DIGEST | |
| 22 | 21 | ||
| 23 | 22 | ## LEGISLATIVE COUNSEL'S DIGEST | |
| 24 | 23 | ||
| 25 | 24 | AB 2416, as amended, Wood. Health care coverage. | |
| 26 | 25 | ||
| 27 | - | Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacted various health care coverage market reforms that took effect on January 1, 2014. PPACA required each state, by January 1, 2014, to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange, also known as Covered California, to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans.Existing law requires a health care service plan, on and after October 1, 2013, to offer, market, and sell all of the plans health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in a service area in which the plan provides or arranges for the provision of health care services.This bill | |
| 26 | + | Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacted various health care coverage market reforms that took effect on January 1, 2014. PPACA required each state, by January 1, 2014, to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange, also known as Covered California, to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans.Existing law requires a health care service plan, on and after October 1, 2013, to offer, market, and sell all of the plans health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in a service area in which the plan provides or arranges for the provision of health care services.This bill would require a health care service plan that has a contract with the State Department of Health Care Services to offer Medi-Cal managed care plans or prepaid health plans, or a Program of All-Inclusive Care for the Elderly (PACE) organization contract with the department, to negotiate with Covered California regarding offering individual products on the Exchange in approved service areas that overlap with counties where there are 2 or fewer health care service plans offering products on the Exchange, as specified. Because a willful violation of the bills requirements 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.Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law prohibits the cancellation or nonrenewal of individual or group health benefit plans by a health care service plan except in specified circumstances.This bill would make technical, nonsubstantive changes by deleting obsolete provisions. | |
| 28 | 27 | ||
| 29 | 28 | Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacted various health care coverage market reforms that took effect on January 1, 2014. PPACA required each state, by January 1, 2014, to establish an American Health Benefit Exchange to facilitate the purchase of qualified health benefit plans by qualified individuals and qualified small employers. Existing state law creates the California Health Benefit Exchange, also known as Covered California, to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers. | |
| 30 | 29 | ||
| 31 | 30 | Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Under existing law, one of the methods by which Medi-Cal services are provided is pursuant to contracts with various types of managed care plans. | |
| 32 | 31 | ||
| 33 | 32 | Existing law requires a health care service plan, on and after October 1, 2013, to offer, market, and sell all of the plans health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in a service area in which the plan provides or arranges for the provision of health care services. | |
| 34 | 33 | ||
| 35 | - | This bill | |
| 34 | + | This bill would require a health care service plan that has a contract with the State Department of Health Care Services to offer Medi-Cal managed care plans or prepaid health plans, or a Program of All-Inclusive Care for the Elderly (PACE) organization contract with the department, to negotiate with Covered California regarding offering individual products on the Exchange in approved service areas that overlap with counties where there are 2 or fewer health care service plans offering products on the Exchange, as specified. Because a willful violation of the bills requirements would be a crime, the bill would impose a state-mandated local program. | |
| 36 | 35 | ||
| 37 | 36 | 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. | |
| 38 | 37 | ||
| 39 | 38 | This bill would provide that no reimbursement is required by this act for a specified reason. | |
| 40 | 39 | ||
| 40 | + | Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law prohibits the cancellation or nonrenewal of individual or group health benefit plans by a health care service plan except in specified circumstances. | |
| 41 | + | ||
| 42 | + | ||
| 43 | + | ||
| 44 | + | This bill would make technical, nonsubstantive changes by deleting obsolete provisions. | |
| 45 | + | ||
| 46 | + | ||
| 47 | + | ||
| 41 | 48 | ## Digest Key | |
| 42 | 49 | ||
| 43 | 50 | ## Bill Text | |
| 44 | 51 | ||
| 45 | - | The people of the State of California do enact as follows:SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read:1360.7. If On | |
| 52 | + | The people of the State of California do enact as follows:SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read:1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018.SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution.SECTION 1.Section 1365 of the Health and Safety Code is amended to read:1365.(a)An enrollment or a subscription shall not be canceled or not renewed except for the following reasons:(1)(A)For nonpayment of the required premiums by the individual, employer, or contractholder if the individual, employer, or contractholder has been duly notified and billed for the charge and at least a 30-day grace period has elapsed since the date of notification or, if longer, the period of time required for notice and any other requirements pursuant to Section 2703, 2712, or 2742 of the federal Public Health Service Act (42 U.S.C. Secs. 300gg-2, 300gg-12, and 300gg-42) and any subsequent rules or regulations has elapsed.(B)Pursuant to subparagraph (A), a health care service plan shall continue to provide coverage as required by the individuals, employers, or contractholders health care service plan contract during the period described in subparagraph (A).(2)The plan demonstrates fraud or an intentional misrepresentation of material fact under the terms of the health care service plan contract by the individual contractholder or employer.(3)In the case of an individual health care service plan contract, the individual subscriber no longer resides, lives, or works in the plans service area, but only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals.(4)In the case of a group health care service plan contract, violation of a material contract provision relating to employer contribution or group participation rates by the contractholder or employer.(5)If the plan ceases to provide or arrange for the provision of health benefits for new health care service plan contracts in the individual or group market, or all markets, in this state, provided, however, that the following conditions are satisfied:(A)Notice of the decision to cease new or existing health benefit plans in the state is provided to the director, the individual or group contractholder or employer, and the enrollees covered under those contracts, at least 180 days prior to discontinuation of those contracts.(B)Health benefit plans shall not be canceled for 180 days after the date of the notice required under subparagraph (A) and, for that business of a plan that remains in force, any plan that ceases to offer for sale new health benefit plans shall continue to be governed by this section with respect to business conducted under this section.(C)Except as authorized under subdivision (b) of Section 1357.09 and Section 1357.10, a plan that ceases to write new health benefit plans in the individual or group market, or all markets, in this state shall be prohibited from offering for sale health benefit plans in that market or markets in this state for a period of five years from the date of the discontinuation of the last coverage not so renewed.(6)If the plan withdraws a health benefit plan from the market, provided that all of the following conditions are satisfied:(A)The plan notifies all affected subscribers, contractholders, employers, and enrollees and the director at least 90 days prior to the discontinuation of the plan.(B)The plan makes available to the individual or group contractholder or employer all health benefit plans that it makes available to new individual or group business, respectively.(C)In exercising the option to discontinue a health benefit plan under this paragraph and in offering the option of coverage under subparagraph (B), the plan acts uniformly without regard to the claims experience of the individual or contractholder or employer, or any health status-related factor relating to enrollees or potential enrollees.(7)In the case of a group health benefit plan, if an individual or employer ceases to be a member of a guaranteed association, as defined in subdivision (n) of Section 1357, but only if that coverage is terminated under this paragraph uniformly without regard to any health status-related factor relating to any enrollee.(b)(1)An enrollee or subscriber who alleges that an enrollment or subscription has been or will be improperly canceled, rescinded, or not renewed may request a review by the director pursuant to Section 1368.(2)If the director determines that a proper complaint exists, the director shall notify the plan and the enrollee or subscriber who requested the review.(3)If, after review, the director determines that the cancellation, rescission, or failure to renew is contrary to existing law, the director shall order the plan to reinstate the enrollee or subscriber. Within 15 days after receipt of that order, the health care service plan shall request a hearing or reinstate the enrollee or subscriber.(4)If an enrollee or subscriber requests a review of the health care service plans determination to cancel or rescind or failure to renew the enrollees or subscribers health care service plan contract pursuant to this section, the health care service plan shall continue to provide coverage to the enrollee or subscriber under the terms of the contract until a final determination of the enrollees or subscribers request for review has been made by the director. This paragraph shall not apply if the health care service plan cancels or does not renew the enrollees or subscribers health care service plan contract for nonpayment of premiums pursuant to paragraph (1) of subdivision (a).(5)A reinstatement pursuant to this subdivision shall be retroactive to the time of cancellation, rescission, or failure to renew and the plan shall be liable for the expenses incurred by the subscriber or enrollee for covered health care services from the date of cancellation, rescission, or nonrenewal to and including the date of reinstatement. The health care service plan shall reimburse the enrollee or subscriber for any expenses incurred pursuant to this paragraph within 30 days of receipt of the completed claim.(c)This section shall not abrogate any preexisting contracts entered into prior to the effective date of this chapter between a subscriber or enrollee and a health care service plan or a specialized health care service plan, including, but not limited to, the financial liability of the plan, except that each plan shall, if directed to do so by the director, exercise its authority, if any, under those preexisting contracts to conform them to existing law.(d)As used in this section, health benefit plan means any individual or group insurance policy or health care service plan contract that provides medical, hospital, and surgical benefits. The term does not include accident only, credit, or disability income coverage, coverage of Medicare services pursuant to contracts with the United States government, Medicare supplement coverage, long-term care insurance, dental or vision coverage, coverage issued as a supplement to liability insurance, insurance arising out of workers compensation law or similar law, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and that is statutorily required to be contained in any liability insurance policy or equivalent self-insurance. | |
| 46 | 53 | ||
| 47 | 54 | The people of the State of California do enact as follows: | |
| 48 | 55 | ||
| 49 | 56 | ## The people of the State of California do enact as follows: | |
| 50 | 57 | ||
| 51 | - | SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read:1360.7. | |
| 58 | + | SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read:1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. | |
| 52 | 59 | ||
| 53 | 60 | SECTION 1. Section 1360.7 is added to the Health and Safety Code, to read: | |
| 54 | 61 | ||
| 55 | 62 | ### SECTION 1. | |
| 56 | 63 | ||
| 57 | - | 1360.7. | |
| 64 | + | 1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. | |
| 58 | 65 | ||
| 59 | - | 1360.7. | |
| 66 | + | 1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. | |
| 60 | 67 | ||
| 61 | - | 1360.7. | |
| 68 | + | 1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. | |
| 62 | 69 | ||
| 63 | 70 | ||
| 64 | 71 | ||
| 65 | - | 1360.7. | |
| 72 | + | 1360.7. If a health care service plan has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000), Chapter 8 (commencing with Section 14200), or Chapter 8.75 (commencing with Section 14591) of Part 3 of Division 9 of the Welfare and Institutions Code, the plan shall negotiate with Covered California regarding offering individual products on the Exchange in the plans approved service areas that overlap with counties where there are two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. | |
| 66 | 73 | ||
| 67 | 74 | SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution. | |
| 68 | 75 | ||
| 69 | 76 | SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution. | |
| 70 | 77 | ||
| 71 | 78 | SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB 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 XIIIB of the California Constitution. | |
| 72 | 79 | ||
| 73 | 80 | ### SEC. 2. | |
| 81 | + | ||
| 82 | + | ||
| 83 | + | ||
| 84 | + | ||
| 85 | + | ||
| 86 | + | (a)An enrollment or a subscription shall not be canceled or not renewed except for the following reasons: | |
| 87 | + | ||
| 88 | + | ||
| 89 | + | ||
| 90 | + | (1)(A)For nonpayment of the required premiums by the individual, employer, or contractholder if the individual, employer, or contractholder has been duly notified and billed for the charge and at least a 30-day grace period has elapsed since the date of notification or, if longer, the period of time required for notice and any other requirements pursuant to Section 2703, 2712, or 2742 of the federal Public Health Service Act (42 U.S.C. Secs. 300gg-2, 300gg-12, and 300gg-42) and any subsequent rules or regulations has elapsed. | |
| 91 | + | ||
| 92 | + | ||
| 93 | + | ||
| 94 | + | (B)Pursuant to subparagraph (A), a health care service plan shall continue to provide coverage as required by the individuals, employers, or contractholders health care service plan contract during the period described in subparagraph (A). | |
| 95 | + | ||
| 96 | + | ||
| 97 | + | ||
| 98 | + | (2)The plan demonstrates fraud or an intentional misrepresentation of material fact under the terms of the health care service plan contract by the individual contractholder or employer. | |
| 99 | + | ||
| 100 | + | ||
| 101 | + | ||
| 102 | + | (3)In the case of an individual health care service plan contract, the individual subscriber no longer resides, lives, or works in the plans service area, but only if the coverage is terminated uniformly without regard to any health status-related factor of covered individuals. | |
| 103 | + | ||
| 104 | + | ||
| 105 | + | ||
| 106 | + | (4)In the case of a group health care service plan contract, violation of a material contract provision relating to employer contribution or group participation rates by the contractholder or employer. | |
| 107 | + | ||
| 108 | + | ||
| 109 | + | ||
| 110 | + | (5)If the plan ceases to provide or arrange for the provision of health benefits for new health care service plan contracts in the individual or group market, or all markets, in this state, provided, however, that the following conditions are satisfied: | |
| 111 | + | ||
| 112 | + | ||
| 113 | + | ||
| 114 | + | (A)Notice of the decision to cease new or existing health benefit plans in the state is provided to the director, the individual or group contractholder or employer, and the enrollees covered under those contracts, at least 180 days prior to discontinuation of those contracts. | |
| 115 | + | ||
| 116 | + | ||
| 117 | + | ||
| 118 | + | (B)Health benefit plans shall not be canceled for 180 days after the date of the notice required under subparagraph (A) and, for that business of a plan that remains in force, any plan that ceases to offer for sale new health benefit plans shall continue to be governed by this section with respect to business conducted under this section. | |
| 119 | + | ||
| 120 | + | ||
| 121 | + | ||
| 122 | + | (C)Except as authorized under subdivision (b) of Section 1357.09 and Section 1357.10, a plan that ceases to write new health benefit plans in the individual or group market, or all markets, in this state shall be prohibited from offering for sale health benefit plans in that market or markets in this state for a period of five years from the date of the discontinuation of the last coverage not so renewed. | |
| 123 | + | ||
| 124 | + | ||
| 125 | + | ||
| 126 | + | (6)If the plan withdraws a health benefit plan from the market, provided that all of the following conditions are satisfied: | |
| 127 | + | ||
| 128 | + | ||
| 129 | + | ||
| 130 | + | (A)The plan notifies all affected subscribers, contractholders, employers, and enrollees and the director at least 90 days prior to the discontinuation of the plan. | |
| 131 | + | ||
| 132 | + | ||
| 133 | + | ||
| 134 | + | (B)The plan makes available to the individual or group contractholder or employer all health benefit plans that it makes available to new individual or group business, respectively. | |
| 135 | + | ||
| 136 | + | ||
| 137 | + | ||
| 138 | + | (C)In exercising the option to discontinue a health benefit plan under this paragraph and in offering the option of coverage under subparagraph (B), the plan acts uniformly without regard to the claims experience of the individual or contractholder or employer, or any health status-related factor relating to enrollees or potential enrollees. | |
| 139 | + | ||
| 140 | + | ||
| 141 | + | ||
| 142 | + | (7)In the case of a group health benefit plan, if an individual or employer ceases to be a member of a guaranteed association, as defined in subdivision (n) of Section 1357, but only if that coverage is terminated under this paragraph uniformly without regard to any health status-related factor relating to any enrollee. | |
| 143 | + | ||
| 144 | + | ||
| 145 | + | ||
| 146 | + | (b)(1)An enrollee or subscriber who alleges that an enrollment or subscription has been or will be improperly canceled, rescinded, or not renewed may request a review by the director pursuant to Section 1368. | |
| 147 | + | ||
| 148 | + | ||
| 149 | + | ||
| 150 | + | (2)If the director determines that a proper complaint exists, the director shall notify the plan and the enrollee or subscriber who requested the review. | |
| 151 | + | ||
| 152 | + | ||
| 153 | + | ||
| 154 | + | (3)If, after review, the director determines that the cancellation, rescission, or failure to renew is contrary to existing law, the director shall order the plan to reinstate the enrollee or subscriber. Within 15 days after receipt of that order, the health care service plan shall request a hearing or reinstate the enrollee or subscriber. | |
| 155 | + | ||
| 156 | + | ||
| 157 | + | ||
| 158 | + | (4)If an enrollee or subscriber requests a review of the health care service plans determination to cancel or rescind or failure to renew the enrollees or subscribers health care service plan contract pursuant to this section, the health care service plan shall continue to provide coverage to the enrollee or subscriber under the terms of the contract until a final determination of the enrollees or subscribers request for review has been made by the director. This paragraph shall not apply if the health care service plan cancels or does not renew the enrollees or subscribers health care service plan contract for nonpayment of premiums pursuant to paragraph (1) of subdivision (a). | |
| 159 | + | ||
| 160 | + | ||
| 161 | + | ||
| 162 | + | (5)A reinstatement pursuant to this subdivision shall be retroactive to the time of cancellation, rescission, or failure to renew and the plan shall be liable for the expenses incurred by the subscriber or enrollee for covered health care services from the date of cancellation, rescission, or nonrenewal to and including the date of reinstatement. The health care service plan shall reimburse the enrollee or subscriber for any expenses incurred pursuant to this paragraph within 30 days of receipt of the completed claim. | |
| 163 | + | ||
| 164 | + | ||
| 165 | + | ||
| 166 | + | (c)This section shall not abrogate any preexisting contracts entered into prior to the effective date of this chapter between a subscriber or enrollee and a health care service plan or a specialized health care service plan, including, but not limited to, the financial liability of the plan, except that each plan shall, if directed to do so by the director, exercise its authority, if any, under those preexisting contracts to conform them to existing law. | |
| 167 | + | ||
| 168 | + | ||
| 169 | + | ||
| 170 | + | (d)As used in this section, health benefit plan means any individual or group insurance policy or health care service plan contract that provides medical, hospital, and surgical benefits. The term does not include accident only, credit, or disability income coverage, coverage of Medicare services pursuant to contracts with the United States government, Medicare supplement coverage, long-term care insurance, dental or vision coverage, coverage issued as a supplement to liability insurance, insurance arising out of workers compensation law or similar law, automobile medical payment insurance, or insurance under which benefits are payable with or without regard to fault and that is statutorily required to be contained in any liability insurance policy or equivalent self-insurance. |