Bill Text: CA AB2115 | 2015-2016 | Regular Session | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Health care coverage: disclosures.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Vetoed) 2016-09-26 - Vetoed by Governor. [AB2115 Detail]
Download: California-2015-AB2115-Amended.html
Bill Title: Health care coverage: disclosures.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Vetoed) 2016-09-26 - Vetoed by Governor. [AB2115 Detail]
Download: California-2015-AB2115-Amended.html
BILL NUMBER: AB 2115 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 11, 2016
AMENDED IN ASSEMBLY APRIL 20, 2016
AMENDED IN ASSEMBLY APRIL 5, 2016
AMENDED IN ASSEMBLY MARCH 18, 2016
INTRODUCED BY Assembly Member Wood
FEBRUARY 17, 2016
An act to amend Sections 1366.24 and
Section 1366.50 of the Health and Safety Code, and to amend
Sections 10128.54 and Section 10786 of
the Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 2115, as amended, Wood. Health care coverage: disclosures.
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 small employers. Existing
state law establishes the California Health Benefit Exchange within
state government for the purpose of facilitating the enrollment of
qualified individuals and qualified small employers in qualified
health plans.
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 requires
specified health care service plans and health insurers to provide to
individuals who cease to be enrolled in individual or group health
care coverage a notice informing those individuals that they may be
eligible for reduced-cost coverage through the California Health
Benefit Exchange or no-cost coverage through Medi-Cal.
Existing law also requires every disclosure form issued by a health
care service plan or insurer for specified group benefit plans to
include a statement notifying the individual to examine his or her
options carefully before declining the group coverage.
This bill would instead require every disclosure form
issued by a health care service plan or insurer for specified group
benefit plans to include a statement notifying the individual that he
or she may be eligible for reduced-cost coverage through the
California Health Benefit Exchange, no-cost coverage through
Medi-Cal, coverage through an insured spouse or parent, or free or
discounted prescription medicines through a manufacturer's patient
assistance program. The bill would also require a statement
regarding patient assistance programs to be included in the notice
from health care service plans and health insurers to individuals who
cease to be enrolled in individual or group health care
coverage. coverage, as specified. Because a
willful violation of these requirements by a health care service plan
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 1366.24 of the Health and
Safety Code is amended to read:
1366.24. (a) Every health care service plan evidence of coverage,
provided for group benefit plans subject to this article, that is
issued, amended, or renewed on or after January 1, 1999, shall
disclose to covered employees of group benefit plans subject to this
article the ability to continue coverage pursuant to this article, as
required by this section.
(b) This disclosure shall state that all enrollees who are
eligible to be qualified beneficiaries, as defined in subdivision (c)
of Section 1366.21, shall be required, as a condition of receiving
benefits pursuant to this article, to notify, in writing, the health
care service plan, or the employer if the employer contracts to
perform the administrative services as provided for in Section
1366.25, of all qualifying events as specified in paragraphs (1),
(3), (4), and (5) of subdivision (d) of Section 1366.21 within 60
days of the date of the qualifying event. This disclosure shall
inform enrollees that failure to make the notification to the health
care service plan, or to the employer when under contract to provide
the administrative services, within the required 60 days will
disqualify the qualified beneficiary from receiving continuation
coverage pursuant to this article. The disclosure shall further state
that a qualified beneficiary who wishes to continue coverage under
the group benefit plan pursuant to this article must request the
continuation in writing and deliver the written request, by
first-class mail, or other reliable means of delivery, including
personal delivery, express mail, or private courier company, to the
health care service plan, or to the employer if the plan has
contracted with the employer for administrative services pursuant to
subdivision (d) of Section 1366.25, within the 60-day period
following the later of (1) the date that the enrollee's coverage
under the group benefit plan terminated or will terminate by reason
of a qualifying event, or (2) the date the enrollee was sent notice
pursuant to subdivision (e) of Section 1366.25 of the ability to
continue coverage under the group benefit plan. The disclosure
required by this section shall also state that a qualified
beneficiary electing continuation shall pay to the health care
service plan, in accordance with the terms and conditions of the plan
contract, which shall be set forth in the notice to the qualified
beneficiary pursuant to subdivision (d) of Section 1366.25, the
amount of the required premium payment, as set forth in Section
1366.26. The disclosure shall further require that the qualified
beneficiary's first premium payment required to establish premium
payment be delivered by first-class mail, certified mail, or other
reliable means of delivery, including personal delivery, express
mail, or private courier company, to the health care service plan, or
to the employer if the employer has contracted with the plan to
perform the administrative services pursuant to subdivision (d) of
Section 1366.25, within 45 days of the date the qualified beneficiary
provided written notice to the health care service plan or the
employer, if the employer has contracted to perform the
administrative services, of the election to continue coverage in
order for coverage to be continued under this article. This
disclosure shall also state that the first premium payment must equal
an amount sufficient to pay any required premiums and all premiums
due, and that failure to submit the correct premium amount within the
45-day period will disqualify the qualified beneficiary from
receiving continuation coverage pursuant to this article.
(c) The disclosure required by this section shall also describe
separately how qualified beneficiaries whose continuation coverage
terminates under a prior group benefit plan pursuant to subdivision
(b) of Section 1366.27 may continue their coverage for the balance of
the period that the qualified beneficiary would have remained
covered under the prior group benefit plan, including the
requirements for election and payment. The disclosure shall clearly
state that continuation coverage shall terminate if the qualified
beneficiary fails to comply with the requirements pertaining to
enrollment in, and payment of premiums to, the new group benefit plan
within 30 days of receiving notice of the termination of the prior
group benefit plan.
(d) Prior to August 1, 1998, every health care service plan shall
provide to all covered employees of employers subject to this article
a written notice containing the disclosures required by this
section, or shall provide to all covered employees of employers
subject to this section a new or amended evidence of coverage that
includes the disclosures required by this section. Any specialized
health care service plan that, in the ordinary course of business,
maintains only the addresses of employer group purchasers of benefits
and does not maintain addresses of covered employees, may comply
with the notice requirements of this section through the provision of
the notices to its employer group purchasers of benefits.
(e) Every plan disclosure form issued, amended, or renewed on and
after January 1, 1999, for a group benefit plan subject to this
article shall provide a notice that, under state law, an enrollee may
be entitled to continuation of group coverage and that additional
information regarding eligibility for this coverage may be found in
the plan's evidence of coverage.
(f) A disclosure issued, amended, or renewed on or after July 1,
2017, for a group benefit plan subject to this article shall include
the following notice:
"In addition to your coverage continuation options, you may be
eligible for the following:
(1) Coverage through Covered California. By enrolling through
Covered California during the annual open enrollment period, you may
qualify for lower monthly premiums and lower out-of-pocket costs.
Your family members may also qualify for coverage through Covered
California. To find out more about how to apply through Covered
California, visit the Covered California Internet Web site at
http:www.coveredca.com.
(2) Coverage though Medi-Cal. Depending on your income, you may
qualify for low- or no-cost coverage though Medi-Cal and can apply
anytime. Your family members may also qualify for Medi-Cal. To find
out more about how to apply for Medi-Cal, visit the Covered
California Internet Web site at http:www.coveredca.com.
(3) Coverage through an insured spouse or parent. If your spouse
has coverage that extends to family members, you may be eligible to
be added to that benefit plan. Federal law does not require employers
to offer coverage to spouses.
(4) Free or discounted prescription medicines through a
manufacturer. You may be eligible for a patient assistance program
offered by the manufacturer of any medicines you currently may be
taking. To find out more about these programs, contact the
manufacturer of your medicine or use an Internet Web site search
tool, such as those provided by the Partnership for Prescription
Assistance at https://www.ppars.org or RxAssist at
http://www.rxassist.org. The manufacturer determines which
individuals and which prescription medications are eligible for the
manufacturer's program. This assistance does not constitute coverage
and will not meet the requirements of the individual mandate under
the Affordable Care Act."
SEC. 2. SECTION 1. Section 1366.50
of the Health and Safety Code is amended to read:
1366.50. (a) (1) On and after January 1,
2017, a health care service plan providing individual or group health
care coverage shall provide to enrollees or subscribers who cease to
be enrolled in coverage a notice informing them that they may be
eligible for reduced-cost coverage through the California Health
Benefit Exchange established under Title 22 (commencing with Section
100500) of the Government Code, no-cost coverage through Medi-Cal, or
free or reduced cost prescription coverage
medicines through a manufacturer's patient assistance
program. The notice shall include information on obtaining coverage
or assistance pursuant to those programs, shall be in no less than
12-point type, and shall be developed by the department, no later
than July 1, 2017, in consultation with the Department of
Insurance Insurance, the Office of the Patient
Advocate, and the California Health Benefit Exchange.
(2) The notice shall include a statement clarifying that
assistance through a manufacturer's patient assistance program does
not constitute coverage under, and will not meet the requirements of
the individual mandate under, the federal Patient Protection and
Affordable Care Act.
(3) The department shall include information in the notice on
locating free or reduced cost programs for health care and
prescription medicines, such as through the Internet Web site of the
Office of the Patient Advocate.
(b) The notice described in subdivision (a) may be incorporated
into or sent simultaneously with and in the same manner as any other
notices sent by the health care service plan.
(c) This section shall not apply with respect to a specialized
health care service plan contract or a Medicare supplemental plan
contract.
SEC. 3. Section 10128.54 of the Insurance Code
is amended to read:
10128.54. (a) Every insurer's evidence of coverage for group
benefit plans subject to this article, that is issued, amended, or
renewed on or after January 1, 1999, shall disclose to covered
employees of group benefit plans subject to this article the ability
to continue coverage pursuant to this article, as required by this
section.
(b) This disclosure shall state that all insureds who are eligible
to be qualified beneficiaries, as defined in subdivision (c) of
Section 10128.51, shall be required, as a condition of receiving
benefits pursuant to this article, to notify, in writing, the
insurer, or the employer if the employer contracts to perform the
administrative services as provided for in Section 10128.55, of all
qualifying events as specified in paragraphs (1), (3), (4), and (5)
of subdivision (d) of Section 10128.51 within 60 days of the date of
the qualifying event. This disclosure shall inform insureds that
failure to make the notification to the insurer, or to the employer
when under contract to provide the administrative services, within
the required 60 days will disqualify the qualified beneficiary from
receiving continuation coverage pursuant to this article. The
disclosure shall further state that a qualified beneficiary who
wishes to continue coverage under the group benefit plan pursuant to
this article must request the continuation in writing and deliver the
written request, by first-class mail, or other reliable means of
delivery, including personal delivery, express mail, or private
courier company, to the disability insurer, or to the employer if the
plan has contracted with the employer for administrative services
pursuant to subdivision (d) of Section 10128.55, within the 60-day
period following the later of (1) the date that the insured's
coverage under the group benefit plan terminated or will terminate by
reason of a qualifying event, or (2) the date the insured was sent
notice pursuant to subdivision (e) of Section 10128.55 of the ability
to continue coverage under the group benefit plan. The disclosure
required by this section shall also state that a qualified
beneficiary electing continuation shall pay to the disability
insurer, in accordance with the terms and conditions of the policy or
contract, which shall be set forth in the notice to the qualified
beneficiary pursuant to subdivision (d) of Section 10128.55, the
amount of the required premium payment, as set forth in Section
10128.56. The disclosure shall further require that the qualified
beneficiary's first premium payment required to establish premium
payment be delivered by first-class mail, certified mail, or other
reliable means of delivery, including personal delivery, express
mail, or private courier company, to the disability insurer, or to
the employer if the employer has contracted with the insurer to
perform the administrative services pursuant to subdivision (d) of
Section 10128.55, within 45 days of the date the qualified
beneficiary provided written notice to the insurer or the employer,
if the employer has contracted to perform the administrative
services, of the election to continue coverage in order for coverage
to be continued under this article. This disclosure shall also state
that the first premium payment must equal an amount sufficient to pay
all required premiums and all premiums due, and that failure to
submit the correct premium amount within the 45-day period will
disqualify the qualified beneficiary from receiving continuation
coverage pursuant to this article.
(c) The disclosure required by this section shall also describe
separately how qualified beneficiaries whose continuation coverage
terminates under a prior group benefit plan pursuant to Section
10128.57 may continue their coverage for the balance of the period
that the qualified beneficiary would have remained covered under the
prior group benefit plan, including the requirements for election and
payment. The disclosure shall clearly state that continuation
coverage shall terminate if the qualified beneficiary fails to comply
with the requirements pertaining to enrollment in, and payment of
premiums to, the new group benefit plan within 30 days of receiving
notice of the termination of the prior group benefit plan.
(d) Prior to August 1, 1998, every insurer shall provide to all
covered employees of employers subject to this article written notice
containing the disclosures required by this section, or shall
provide to all covered employees of employers subject to this article
a new or amended evidence of coverage that includes the disclosures
required by this section. Any insurer that, in the ordinary course of
business, maintains only the addresses of employer group purchasers
of benefits, and does not maintain addresses of covered employees,
may comply with the notice requirements of this section through the
provision of the notices to its employer group purchasers of
benefits.
(e) Every disclosure form issued, amended, or renewed on and after
January 1, 1999, for a group benefit plan subject to this article
shall provide a notice that, under state law, an insured may be
entitled to continuation of group coverage and that additional
information regarding eligibility for this coverage may be found in
the evidence of coverage.
(f) A disclosure issued, amended, or renewed on or after July 1,
2017, for a group benefit plan subject to this article shall include
the following notice:
"In addition to your coverage continuation options, you may be
eligible for the following:
(1) Coverage through Covered California. By enrolling through
Covered California during the annual open enrollment period, you may
qualify for lower monthly premiums and lower out-of-pocket costs.
Your family members may also qualify for coverage through Covered
California. To find out more about how to apply through Covered
California, visit the Covered California Internet Web site at
http:www.coveredca.com.
(2) Coverage though Medi-Cal. Depending on your income, you may
qualify for low- or no-cost coverage though Medi-Cal and can apply
anytime. Your family members may also qualify for Medi-Cal. To find
out more about how to apply for Medi-Cal, visit the Covered
California Internet Web site at http:www.coveredca.com.
(3) Coverage through an insured spouse or parent. If your spouse
has coverage that extends to family members, you may be eligible to
be added to that benefit plan. Federal law does not require employers
to offer coverage to spouses.
(4) Free or discounted prescription medicines through a
manufacturer. You may be eligible for a patient assistance program
offered by the manufacturer of any medicines you currently may be
taking. To find out more about these programs, contact the
manufacturer of your medicine or use an Internet Web site search
tool, such as those provided by the Partnership for Prescription
Assistance at https://www.ppars.org or RxAssist at
http://www.rxassist.org. The manufacturer determines which
individuals and which prescription medications are eligible for the
manufacturer's program. This assistance does not constitute coverage
and will not meet the requirements of the individual mandate under
the Affordable Care Act."
SEC. 4. SEC. 2. Section 10786 of the
Insurance Code is amended to read:
10786. (a) (1) On and after January 1,
2017, a health insurer providing health insurance coverage shall
provide to policyholders in individual policies or certificate
holders in group policies who cease to be enrolled in coverage a
notice informing them that they may be eligible for reduced-cost
coverage through the California Health Benefit Exchange established
under Title 22 (commencing with Section 100500) of the Government
Code, no-cost coverage through Medi-Cal, or free or reduced cost
prescription coverage medicines through a
manufacturer's patient assistance program. The notice shall include
information on obtaining coverage or assistance pursuant
to those programs, shall be in no less than 12-point type, and shall
be developed by the department, no later than July 1, 2017, in
consultation with the Department of Managed Health Care
Care, the Office of the Patient Advocate,
and the California Health Benefit Exchange.
(2) The notice shall include a statement clarifying that
assistance through a manufacturer's patient assistance program does
not constitute coverage under, and will not meet the requirements of
the individual mandate under, the federal Patient Protection and
Affordable Care Act.
(3) The department shall include information in the notice on
locating free or reduced cost programs for health care and
prescription medicines, such as through the Internet Web site of the
Office of the Patient Advocate.
(b) The notice described in subdivision (a) may be incorporated
into or sent simultaneously with and in the same manner as any other
notices sent by the health insurer.
(c) This section shall not apply with respect to a specialized
health insurance policy or a health insurance policy consisting
solely of coverage of excepted benefits as described in Section 2722
of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-21).
SEC. 5. SEC. 3. 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.
