Amended  IN  Assembly  April 08, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 457

Introduced by Assembly Member Santiago

February 08, 2021

An act to amend Sections 1374.13 and 1374.14 of, and to add Part 4.7 (commencing with Section 124970) to Division 106 of, the Health and Safety Code, to amend Sections 10123.85 and 10123.855 of the Insurance Code, and to amend Section 14132.72 of the Welfare and Institutions Code, relating to telehealth. An act to add Section 1374.141 to the Health and Safety Code, and to add Section 10123.856 to the Insurance Code, relating to telehealth.


LEGISLATIVE COUNSEL'S DIGEST


AB 457, as amended, Santiago. Telehealth Patient Bill of Rights. Protection of Patient Choice in Telehealth Provider Act.

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, Medi-Cal services may be provided pursuant to contracts with various types of managed care health plans, including through a county organized health system. Under existing law, in-person contact between a health care provider and a patient is not required under the Medi-Cal program for services appropriately provided through telehealth.

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 the act a crime. Existing law provides for the regulation of health insurers by the Department of Insurance. Existing law requires a contract issued, amended, or renewed on or after January 1, 2021, between a health care service plan or health insurer and a health care provider to require the plan or insurer to reimburse the provider for the diagnosis, consultation, or treatment of an enrollee, subscriber, insured, or policyholder appropriately delivered through telehealth services on the same basis and to the same extent as the same service through in-person diagnosis, consultation, or treatment.

This bill would create the TeleHealth Patient Bill of Rights, which would, among other things, protect the rights of a patient using telehealth to been seen by a health care provider with a physical presence within a reasonable geographic distance from the patient’s home, unless specified exceptions apply. The bill would require a health plan, as defined, to comply with the requirements in the Telehealth Patient Bill of Rights and to provide written notice to patients of all their rights under the Telehealth Bill of Rights. The bill would also exempt a health care service plan or a health insurer from the existing telehealth payment parity provisions for any interaction where the health care provider is not located within a reasonable geographic distance of the patient’s home, unless that provider holds specialized knowledge not available in the patient’s region. Because a willful violation of the bill’s requirements relative to health care service plans would be a crime, the bill would impose a state-mandated local program.

This bill would enact the Protection of Patient Choice in Telehealth Provider Act, which would require a health care service plan and a health insurer to arrange for the provision of a service via telehealth to an enrollee or an insured through a third-party corporate telehealth provider only if the service is not available to the enrollee or insured via telehealth through a contracting individual health professional, a contracting clinic, or a contracting health facility, consistent with existing timeliness standards, when specified conditions are met. Because a willful violation of the bill’s requirements 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   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 This act shall be known and may be cited as the Protection of Patient Choice in Telehealth Provider Act.
Protection of Patient Choice in Telehealth Provider Act

SEC. 2.

 Section 1374.141 is added to the Health and Safety Code, immediately following Section 1374.14, to read:

1374.141.
 (a) A health care service plan shall arrange for the provision of a service via telehealth to an enrollee through a third-party corporate telehealth provider only if the service is not available to the enrollee via telehealth through a contracting individual health professional, a contracting clinic, or a contracting health facility consistent with the existing timeliness standards in Section 1367.03 and regulations promulgated thereunder, and all of the following conditions are met:
(1) The enrollee is given the option of receiving the service on an in-person basis from the enrollee’s primary care provider, treating specialist, or from another contracting individual health professional, contracting clinic, or contracting health facility consistent with the existing timeliness and geographic access standards in Sections 1367 and 1367.03 and regulations promulgated thereunder.
(2) If the enrollee has coverage for out-of-network benefits, the enrollee is given the option of receiving the service either via telehealth or on an in-person basis using the enrollee’s out-of-network benefits.
(3) The enrollee elects to receive the service via telehealth through a third-party corporate telehealth provider.
(4) The enrollee consents to the service consistent with Section 2290.5 of the Business and Professions Code.
(b) For purposes of this section, the following definitions shall apply:
(1) “Contracting individual health professional” means a physician and surgeon or other professional who is licensed by the state to deliver or furnish health care services and who is contracted with the enrollee’s health care service plan. For this purpose, a “contracting individual health professional” shall not include a dentist licensed pursuant to the Dental Practice Act (Chapter 4 (commencing with Section 1600) of Division 2 of the Business and Professions Code). Application of this definition is not precluded by a contracting individual health professional’s affiliation with a group.
(2) “Contracting clinic” means a clinic, as defined in Section 1200, that is contracted with the enrollee’s health care service plan.
(3) “Contracting health facility” means a health facility, as defined in Section 1250, that is contracted with the enrollee’s health care service plan.
(c) If services are provided to an enrollee through a third-party corporate telehealth provider, a health care service plan shall comply with all of the following:
(1) Notify the enrollee of their right to access their medical records pursuant to, and consistent with, Chapter 1 (commencing with Section 123100) of Part 1 of Division 106.
(2) Notify the enrollee that upon the enrollee’s request, the record of any services provided to the enrollee through a third-party corporate telehealth provider shall be shared with their primary care provider.
(3) Upon the request of an enrollee pursuant to paragraph (2), ensure that the records are entered into a patient record system shared with the enrollee’s primary care provider or are otherwise provided to the enrollee’s primary care provider in a manner consistent with state and federal law.
(d) A health care service plan shall include in its reports submitted to the department pursuant to Section 1367.035 and regulations adopted pursuant to that section, in a manner specified by the department, all of the following for each product type:
(1) By specialty, the total number of services delivered via telehealth, including the number provided by contracting individual health professionals and the number provided by third-party corporate telehealth providers.
(2) The names of each third-party corporate telehealth provider contracted with the plan and, for each, the number of services provided by specialty.
(3) For each third-party corporate telehealth provider with which it contracts, the percentage of the third-party corporate telehealth provider’s contracted providers available to the plan’s enrollees that are also contracting individual health professionals.
(e) The director shall, as appropriate, investigate and take enforcement action against a health care service plan that fails to comply with these requirements and shall periodically evaluate contracts between health care service plans and third-party corporate telehealth providers to determine if any audit, evaluation, or enforcement actions should be undertaken by the department.
(f) If a health care service plan delegates payment functions to a contracted entity, including, but not limited to, a medical group or independent practice association, the delegated entity shall comply with this section.

SEC. 3.

 Section 10123.856 is added to the Insurance Code, to read:

10123.856.
 (a) A health insurer shall arrange for the provision of a service via telehealth to an insured through a third-party corporate telehealth provider only if the service is not available to the insured via telehealth through a contracting individual health professional, a contracting clinic, or a contracting health facility consistent with the existing timeliness standards in Section 10133.5 and regulations promulgated thereunder, and all of the following conditions are met:
(1) The insured is given the option of receiving the service on an in-person basis from the insured’s primary care provider, treating specialist, or from another contracting individual health professional, a contracting clinic, or a contracting health facility consistent with the existing timeliness and geographic access standards in Section 10133.5 and regulations promulgated thereunder.
(2) If the insured has coverage for out-of-network benefits, the insured is given the option of receiving the service either via telehealth or on an in-person basis using the insured’s out-of-network benefits.
(3) The insured elects to receive the service via telehealth through a third-party corporate telehealth provider.
(4) The insured consents to the service consistent with Section 2290.5 of the Business and Professions Code.
(b) For purposes of this section, the following definitions shall apply:
(1) “Contracting individual health professional” means a physician and surgeon or other professional who is licensed by the state to deliver or furnish health care services and who is contracted with the insured’s health insurer. For this purpose, a “contracting individual health professional” shall not include a dentist licensed pursuant to the Dental Practice Act (Chapter 4 (commencing with Section 1600) of Division 2 of the Business and Professions Code). Application of this definition is not precluded by a contracting individual health professional’s affiliation with a group.
(2) “Contracting clinic” means a clinic, as defined in Section 1200 of the Health and Safety Code, that is contracted with the insured’s health insurer.
(3) “Contracting health facility” mean a health facility, as defined in Section 1250 of the Health and Safety Code, that is contracted with the insured’s health insurer.
(c) If services are provided to an insured through a third-party corporate telehealth provider, a health insurer shall comply with all of the following:
(1) Notify the insured of the insured’s right to access the insured’s medical records pursuant to, and consistent with, Chapter 1 (commencing with Section 123100) of Part 1 of Division 106 of the Health and Safety Code.
(2) Notify the insured that upon the insured’s request, the record of any services provided to the insured through a third-party corporate telehealth provider shall be shared with the insured’s primary care provider.
(3) Upon the request of an insured pursuant to paragraph (2), ensure that the records are entered into a patient record system shared with the insured’s primary care provider or are otherwise provided to the insured’s primary care provider, in a manner consistent with state and federal law.
(d) A health insurer shall include in its reports submitted to the department pursuant to Section 10133.5 and regulations adopted pursuant to that section, in a manner specified by the commissioner, all of the following for each product type:
(1) By specialty, the total number of services delivered via telehealth, including the number provided by contracting individual health professionals and the number provided by third-party corporate telehealth providers.
(2) The names of each third-party corporate telehealth provider contracted with the insurer and, for each, the number of services provided by specialty.
(3) For each third-party corporate telehealth provider with which it contracts, the percentage of the third-party corporate telehealth provider’s contracted providers available to the insurer’s insured that are also contracting individual health professionals.
(e) The commissioner shall, as appropriate, investigate and take enforcement action against a health insurer that fails to comply with these requirements and shall periodically evaluate contracts between health insurers and third-party corporate telehealth providers to determine if any audit, evaluation, or enforcement actions should be undertaken by the commissioner.
(f) If a health insurer delegates payment functions to a contracted entity, including, but not limited to, a medical group or independent practice association, the delegated entity shall comply with this section.

SEC. 4.

 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.
SECTION 1.Section 1374.13 of the Health and Safety Code is amended to read:
1374.13.

(a)For the purposes of this section, the definitions in subdivision (a) of Section 2290.5 of the Business and Professions Code apply.

(b)It is the intent of the Legislature to recognize the practice of telehealth as a legitimate means by which an individual may receive health care services from a health care provider without in-person contact with the health care provider.

(c)A health care service plan shall not require that in-person contact occur between a health care provider and a patient before payment is made for the covered services appropriately provided through telehealth, subject to the terms and conditions of the contract entered into between the enrollee or subscriber and the health care service plan, and between the health care service plan and its participating providers or provider groups, and pursuant to Section 1374.14.

(d)A health care service plan shall not limit the type of setting where services are provided for the patient or by the health care provider before payment is made for the covered services appropriately provided through telehealth, subject to the terms and conditions of the contract entered into between the enrollee or subscriber and the health care service plan, and between the health care service plan and its participating providers or provider groups, and pursuant to Section 1374.14.

(e)(1)For a health care service plan contract issued, amended, and renewed on or after January 1, 2022, a health care service plan shall comply with the requirements of the Telehealth Patient Bill of Rights, pursuant to Section 124970.

(2)A health care service plan shall notify an enrollee in writing of all of their rights under the Telehealth Patient Bill of Rights contained in Section 124970.

(f)This section shall also apply to health care service plan contracts and Medi-Cal managed care plan contracts with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000) or Chapter 8 (commencing with Section 14200) of Part 3 of Division 9 of the Welfare and Institutions Code.

(g)Notwithstanding any other law, this section does not authorize a health care service plan to require the use of telehealth if the health care provider has determined that it is not appropriate.

SEC. 2.Section 1374.14 of the Health and Safety Code is amended to read:
1374.14.

(a)(1)A contract issued, amended, or renewed on or after January 1, 2021, between a health care service plan and a health care provider for the provision of health care services to an enrollee or subscriber shall specify that the health care service plan shall reimburse the treating or consulting health care provider for the diagnosis, consultation, or treatment of an enrollee or subscriber appropriately delivered through telehealth services on the same basis and to the same extent that the health care service plan is responsible for reimbursement for the same service through in-person diagnosis, consultation, or treatment.

(2)This section does not limit the ability of a health care service plan and a health care provider to negotiate the rate of reimbursement for a health care service provided pursuant to a contract subject to this section. Services that are the same, as determined by the provider’s description of the service on the claim, shall be reimbursed at the same rate whether provided in person or through telehealth. When negotiating a rate of reimbursement for telehealth services for which no in-person equivalent exists, a health care service plan and the provider shall ensure the rate is consistent with subdivision (h) of Section 1367.

(3)This section does not require telehealth reimbursement to be unbundled from other capitated or bundled, risk-based payments.

(b)(1)A health care service plan contract issued, amended, or renewed on or after January 1, 2021, shall specify that the health care service plan shall provide coverage for health care services appropriately delivered through telehealth services on the same basis and to the same extent that the health care service plan is responsible for coverage for the same service through in-person diagnosis, consultation, or treatment. Coverage shall not be limited only to services delivered by select third-party corporate telehealth providers.

(2)This section does not alter the obligation of a health care service plan to ensure that enrollees have access to all covered services through an adequate network of contracted providers, as required under Sections 1367, 1367.03, and 1367.035, and the regulations promulgated thereunder.

(3)This section does not require a health care service plan to cover telehealth services provided by an out-of-network provider, unless coverage is required under other provisions of law.

(c)A health care service plan may offer a contract containing a copayment or coinsurance requirement for a health care service delivered through telehealth services, provided that the copayment or coinsurance does not exceed the copayment or coinsurance applicable if the same services were delivered through in-person diagnosis, consultation, or treatment. This subdivision does not require cost sharing for services provided through telehealth.

(d)Services provided through telehealth and covered pursuant to this chapter shall be subject to the same deductible and annual or lifetime dollar maximum as equivalent services that are not provided through telehealth.

(e)The definitions in subdivision (a) of Section 2290.5 of the Business and Professions Code apply to this section.

(f)This section shall not apply to Medi-Cal managed care plans that contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000) of, Chapter 8 (commencing with Section 14200) of, or Chapter 8.75 (commencing with Section 14591) of, Part 3 of Division 9 of the Welfare and Institutions Code.

(g)This section shall not apply to any interaction where the health care provider is not located within a reasonable geographic distance of the patient’s home, unless that provider holds specialized knowledge not available in the patient’s region.

SEC. 3.Part 4.7 (commencing with Section 124970) is added to Division 106 of the Health and Safety Code, to read:
4.7.Telehealth Patient Bill of Rights
124970.

The following shall be known, and may be cited as, the Telehealth Patient Bill of Rights:

(a)The purpose of the provision of telehealth is to allow patients increased access to their chosen health care provider and, when necessary, minimize the risk of adverse health outcomes.

(b)A patient receiving health care services through telehealth has all the rights awarded to them under the Knox-Keene Health Care Service Plan Act of 1975, Title 22 of the California Code of Regulations, and the Welfare and Institutions Code, if applicable.

(c)(1)If a health plan waives cost-sharing requirements for telehealth it shall apply to all health care services provided under that telehealth modality.

(2) A health plan shall reimburse a health care provider for the waived cost-sharing amount.

(3)(A)A health plan shall not delegate the financial risk to a contracted provider for the cost of patient services provided under this section.

(B)Notwithstanding subparagraph (A), a health plan may delegate the financial risk to a contracted provider for the cost of patient services provided under this section if the parties have negotiated and agreed upon a new provision of the parties’ contract, pursuant to Section 1375.7 and Section 10133.65 of the Insurance Code.

(d)When receiving health care services via telehealth, a patient has the right to be seen by a health care provider with a physical presence within a reasonable geographic distance from the patient’s home, based on the geographic accessibility standards of the Knox-Keene Health Care Service Plan Act of 1975 or the Medi-Cal Act, as specified under Section 14197 of the Welfare and Institutions Code, unless one of the following conditions is met:

(1)The provider holds specialized knowledge not available in the patient’s region or has a contractual obligation with a practice or facility close to the patient.

(2)The patient has agreed to be treated by a distant site provider for a mental or behavioral health condition.

(3)The distant site provider is consulting directly with the patient’s treating provider for the purposes of providing specialty consultation on the patient’s case.

(e)(1)All records of a telehealth visit shall be forwarded electronically to the patient’s primary care physician, or other physician of the patient’s choosing.

(2)The record shall be sent as soon as practicable, but in no case shall it be more than 15 days after the patient visit.

(f)For the purposes of complying with timely access and network adequacy regulations, a health plan shall only consider telehealth providers who are located within reasonable distance of the patient’s home, or who have a contractual obligation to a practice or facility located within a reasonable distance of the patient’s home.

(g)For the purposes of this section, “health plan” means any of the following:

(1)A health care service plan as defined under subdivision (f) of Section 1345.

(2)A health insurer that issues policies of health insurance, as defined in Section 106 of the Insurance Code.

(3)Any program administered by the State Department of Health Care Services, including Medi-Cal managed care plans.

SEC. 4.Section 10123.85 of the Insurance Code is amended to read:
10123.85.

(a)For purposes of this section, the definitions in subdivision (a) of Section 2290.5 of the Business and Professions Code apply.

(b)It is the intent of the Legislature to recognize the practice of telehealth as a legitimate means by which an individual may receive health care services from a health care provider without in-person contact with the health care provider.

(c)A health insurer shall not require that in-person contact occur between a health care provider and a patient before payment is made for the services appropriately provided through telehealth, subject to the terms and conditions of the contract entered into between the policyholder or contractholder and the insurer, and between the insurer and its participating providers or provider groups, and pursuant to Section 10123.855.

(d)A health insurer shall not limit the type of setting where services are provided for the patient or by the health care provider before payment is made for the covered services appropriately provided by telehealth, subject to the terms and conditions of the contract between the policyholder or contractholder and the insurer, and between the insurer and its participating providers or provider groups, and pursuant to Section 10123.855.

(e)(1)For a health insurance policy issued, amended, and renewed on or after January 1, 2022, a health insurer shall comply with the requirements of the Telehealth Patient Bill of Rights, pursuant to Section 124970 of the Health and Safety Code.

(2)A health insurer shall notify an insured in writing of all of their rights under the Telehealth Patient Bill of Rights contained in Section 124970 of the Health and Safety Code.

(f)Notwithstanding any other law, this section does not authorize a health insurer to require the use of telehealth if the health care provider has determined that it is not appropriate.

SEC. 5.Section 10123.855 of the Insurance Code is amended to read:
10123.855.

(a)(1)A contract issued, amended, or renewed on or after January 1, 2021, between a health insurer and a health care provider for an alternative rate of payment pursuant to Section 10133 shall specify that the health insurer shall reimburse the treating or consulting health care provider for the diagnosis, consultation, or treatment of an insured or policyholder appropriately delivered through telehealth services on the same basis and to the same extent that the health insurer is responsible for reimbursement for the same service through in-person diagnosis, consultation, or treatment.

(2)This section does not limit the ability of a health insurer and a health care provider to negotiate the rate of reimbursement for a health care service provided pursuant to a contract subject to this section. Services that are the same, as determined by the provider’s description of the service on the claim, shall be reimbursed at the same rate whether provided in person or through telehealth. When negotiating a rate of reimbursement for telehealth services for which no in-person equivalent exists, a health insurer and the provider shall ensure the rate is consistent with subdivision (a) of Section 10123.137.

(b)(1)A policy of health insurance issued, amended, or renewed on or after January 1, 2021, that provides benefits through contracts with providers at alternative rates of payment shall specify that the health insurer shall provide coverage for health care services appropriately delivered through telehealth services on the same basis and to the same extent that the health insurer is responsible for coverage for the same service through in-person diagnosis, consultation, or treatment. Coverage shall not be limited only to services delivered by select third-party corporate telehealth providers.

(2)This section does not alter the existing statutory or regulatory obligations of a health insurer to ensure that insureds have access to all covered services through an adequate network of contracted providers, as required by Sections 10133 and 10133.5 and the regulations promulgated thereunder.

(3)This section does not require a health insurer to deliver health care services through telehealth services.

(4)This section does not require a health insurer to cover telehealth services provided by an out-of-network provider, unless coverage is required under other provisions of law.

(c)A health insurer may offer a policy containing a copayment or coinsurance requirement for a health care service delivered through telehealth services, provided that the copayment or coinsurance does not exceed the copayment or coinsurance applicable if the same services were delivered through in-person diagnosis, consultation, or treatment. This subdivision does not require cost sharing for services provided through telehealth.

(d)Services provided through telehealth and covered pursuant to this chapter shall be subject to the same deductible and annual or lifetime dollar maximum as equivalent services that are not provided through telehealth.

(e)The definitions in subdivision (a) of Section 2290.5 of the Business and Professions Code apply to this section.

(f)This section shall not apply to any interaction where the health care provider is not located within a reasonable geographic distance of the patient’s home, unless that provider holds specialized knowledge not available in the patient’s region.

SEC. 6.Section 14132.72 of the Welfare and Institutions Code is amended to read:
14132.72.

(a)For purposes of this section, the definitions in subdivision (a) of Section 2290.5 of the Business and Professions Code shall apply.

(b)It is the intent of the Legislature to recognize the practice of telehealth as a legitimate means by which an individual may receive health care services from a health care provider without in-person contact with the provider.

(c)In-person contact between a health care provider and a patient shall not be required under the Medi-Cal program for services appropriately provided through telehealth, subject to reimbursement policies adopted by the department to compensate a licensed health care provider who provides health care services through telehealth that are otherwise reimbursed pursuant to the Medi-Cal program.  Nothing in this section or the Telehealth Advancement Act of 2011 shall be construed to conflict with or supersede the provisions of Section 14091.3 of this code or any other existing state laws or regulations related to reimbursement for services provided by a noncontracted provider.

(d)The department shall not require a health care provider to document a barrier to an in-person visit for Medi-Cal coverage of services provided via telehealth.

(e)For the purposes of payment for covered treatment or services provided through telehealth, the department shall not limit the type of setting where services are provided for the patient or by the health care provider.

(f)(1)The department shall comply with the requirements of the Telehealth Patient Bill of Rights, pursuant to Section 124970 of the Health and Safety Code.

(2)The department shall notify beneficiaries in writing of all of their rights under the Telehealth Patient Bill of Rights contained in Section 124970 of the Health and Safety Code.

(g)Nothing in this section shall be interpreted to authorize the department to require the use of telehealth when the health care provider has determined that it is not appropriate.

(h)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the department may implement, interpret, and make specific this section by means of all-county letters, provider bulletins, and similar instructions.

SEC. 7.

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.