Bill Text: CA AB533 | 2015-2016 | Regular Session | Amended
Bill Title: Health care coverage: out-of-network coverage.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2016-11-30 - Died on inactive file. [AB533 Detail]
Download: California-2015-AB533-Amended.html
BILL NUMBER: AB 533 AMENDED
BILL TEXT
AMENDED IN SENATE SEPTEMBER 4, 2015
AMENDED IN SENATE AUGUST 18, 2015
AMENDED IN SENATE JULY 7, 2015
AMENDED IN ASSEMBLY APRIL 23, 2015
AMENDED IN ASSEMBLY APRIL 15, 2015
INTRODUCED BY Assembly Member Bonta
FEBRUARY 23, 2015
An act to add Sections 1371.30, 1371.31, and 1371.9 to the Health
and Safety Code, and to add Sections 10112.8, 10112.81, and 10112.82
to the Insurance Code, relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 533, as amended, Bonta. Health care coverage: out-of-network
coverage.
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. A willful violation
of the act is a crime. Existing law requires a health care service
plan to reimburse providers for emergency services and care provided
to its enrollees, until the care results in stabilization of the
enrollee. Existing law prohibits a health care service
plan from requiring a provider to obtain authorization prior to the
provision of emergency services and care necessary to stabilize the
enrollee's emergency medical care, as specified.
Existing law also provides for the regulation of health insurers
by the Insurance Commissioner. Existing law requires a health
insurance policy issued, amended, or renewed on or after January 1,
2014, that provides or covers benefits with respect to services in an
emergency department of a hospital to cover emergency services
without the need for prior authorization, regardless of whether the
provider is a participating provider, and subject to the same cost
sharing required if the services were provided by a participating
provider, as specified.
This bill would require a health care service plan contract or
health insurance policy issued, amended, or renewed on or after
January July 1, 2016, to provide that
if an enrollee or insured obtains care
receives covered services from a contracting health facility,
as defined, at which, or as a result of which, the enrollee or
insured receives covered services provided by a noncontracting
individual health professional, as defined, the enrollee or insured
is would be required to pay the
noncontracting individual health professional only the same cost
sharing required if the services were provided by a contracting
individual health professional. The bill would prohibit an enrollee
or insured from owing the noncontracting individual health
professional at the contracting health facility more than the
in-network cost sharing cost-sharing
amount if the noncontracting individual health professional receives
reimbursement for services provided to the enrollee or insured at a
contracting health facility from the health care service
plan or health insurer. However, the bill would make an
exception from this prohibition if the enrollee or insured provides
written consent that satisfies specified criteria. The bill
would require a noncontracting individual health professional who
collects more than the in-network cost-sharing amount from the
enrollee or insured to refund any overpayment to the enrollee or
insured, as specified, and would provide that interest on any amount
overpaid by, and not refunded to, the enrollee or insured shall
accrue at 15% per annum, as specified.
Existing law requires a contract between a health care service
plan and a provider, or a contract between an insurer and a provider,
to contain provisions requiring a fast, fair, and cost-effective
dispute resolution mechanism under which providers may submit
disputes to the plan or insurer. Existing law requires that dispute
resolution mechanism also be made accessible to a noncontracting
provider for the purpose of resolving billing and claims disputes.
This bill would require the department and the commissioner to
each establish an independent dispute resolution process that would
allow a noncontracting individual health professional who rendered
services at a contracting health facility
facility, or a plan or insurer, to appeal a claim payment
dispute with a plan or insurer, dispute,
as specified. The bill would authorize the department and the
commissioner to contract with one or more independent dispute
resolution organizations to conduct the independent dispute
resolution process, as specified. The bill would provide that the
decision of the organization would be binding on the parties.
The bill would require a health care service plan to base
reimbursement of a claim by a noncontracting individual health
professional on statistically credible information with regard to the
amount paid to contracted individual health professionals who
provide similar services, are not capitated, and practice in the same
or a similar geographic region, as specified. The bill
would require an a plan or insurer to
base reimbursement of a claim by a noncontracting health
professional on statistically credible information with regard to the
amount paid to contracted individual health professionals who
provide similar services and practice in the same or a similar
geographic region, as specified. for covered services
on the amount the individual health professional would have been
reimbursed by Medicare for the same or similar services in the
general geographic area in which the services were rendered.
The bill would require a noncontracting individual health
professional who disputes that claim reimbursement to utilize the
independent dispute resolution process. The bill would provide that
these provisions do not apply to emergency services and care, as
defined.
Because a willful violation of the bill's provisions relative to a
health care service plan would be a crime, the bill would impose a
state-mandated local program.
Existing constitutional provisions require that a statute that
limits the right of access to the meetings of public bodies or the
writings of public officials and agencies be adopted with findings
demonstrating the interest protected by the limitation and the need
for protecting that interest.
This bill would make legislative findings to that effect.
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 1371.30 is added to the Health and Safety Code,
immediately following Section 1371.3, to read:
1371.30. (a) (1) The department shall establish an independent
dispute resolution process for the purpose of processing and
resolving a claim dispute between a health care service plan and a
noncontracting individual health professional for services subject to
Section 1371.9.
(2) If either the noncontracting individual health professional or
the plan appeals a claim to the department's independent dispute
resolution process, the other party shall participate in the appeal
process as described in this section.
(b) The department and the Department of Insurance shall
jointly shall establish uniform written
procedures for the submission, receipt, processing, and resolution of
claim payment disputes pursuant to this section.
section and any other guidelines for implementing this article.
(c) The department may contract with one or more independent
organizations that specialize in dispute resolution
to conduct the proceedings. The independent organization
handling a dispute shall be independent of either party to the
dispute. The department shall establish conflict-of-interest
standards, consistent with the purposes of this section, that an
organization shall meet in order to qualify for participation in the
independent dispute resolution program. The department may contract
with the same independent organization or organizations as the
Department of Insurance.
(d) The determination obtained through the department's
independent dispute resolution process shall be binding on both
parties.
(e) This section shall not apply to a Medi-Cal managed health care
service plan or any entity that enters into a 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, and Chapter 8.75 (commencing with Section 14591)
of, Part 3 of Division 9 of the Welfare and Institutions Code.
(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, then the delegated entity shall
comply with this section.
(g) This section shall not apply to emergency services and care,
as defined in Section 1317.1.
SEC. 2. Section 1371.31 is added to the Health and Safety Code,
immediately following Section 1371.30, to read:
1371.31. (a) (1) The health care service plan shall maintain
statistically credible information, updated at least annually,
regarding rates paid to currently contracting individual health
professionals or a group of professionals who provide similar
services, are not capitated, and are practicing in the same or a
similar geographic area as the noncontracting individual health
professional.
(2) If, based on the health care service plan's model or payment
arrangements, a health care service plan does not pay a statistically
significant number or dollar amount of claims for covered services
in order to maintain the statistically credible information required
by paragraph (1), the health care service plan shall demonstrate to
the department that it has access to a statistically credible
database reflecting reasonable rates paid to providers for services
provided in the same or similar geographic area.
(3) The statistically credible information required by paragraphs
(1) and (2) shall be confidential and exempt from public disclosure.
(b) (1) Unless otherwise provided in this section or otherwise
agreed by the noncontracting individual health professional and the
plan, the plan shall base reimbursement of noncontracted claims for
services rendered according to Section 1371.9 on the average rates
based on the statistically credible information with regard to the
amount paid to contracted individual health professionals who are
providing similar services, are not capitated, and practicing in the
same or similar geographic area.
1371.31. (a) For services rendered subject to
Section 1371.9, unless otherwise agreed to by the noncontracting
individual health professional and the plan, the plan shall base
reimbursement for covered services on the amount the individual
health professional would have been reimbursed by Medicare for the
same or similar services in the general geographic area in which the
services were rendered.
(2)
(b) If nonemergency services are provided by a
noncontracting individual health professional pursuant to
subdivision (d) of Section 1371.9, to an enrollee who has
voluntarily chosen to use his or her out-of-network benefit for
services covered by a preferred provider organization or a point of
service plan, unless otherwise agreed to by the plan and the
noncontracting individual health professional, the amount paid shall
be the amount set forth in the enrollee's evidence of coverage.
(3)
(c) A noncontracting individual health professional who
disputes the claim reimbursement shall utilize the independent
dispute resolution process described in Section 1371.30.
(c)
(d) If a health care service plan delegates by written
contract the responsibility for payment of claims to a contracted
entity, including, but not limited to, a medical group or independent
practice association, then the entity to which that responsibility
is delegated shall comply with the requirements of this section.
(d)
(e) A payment made by the health care service plan to
the noncontracting health care professional for nonemergency services
as required by Section 1371.9 and this section, in addition to the
applicable cost sharing owed by the enrollee, shall constitute
payment in full for nonemergency services rendered.
(e)
(f) This section shall not apply to a Medi-Cal managed
health care service plan or any other entity that enters into a
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, and Chapter 8.75 (commencing with
Section 14591) of, Part 3 of Division 9 of the Welfare and
Institutions Code.
(f)
(g) This section shall not apply to emergency services
and care, as defined in Section 1317.1.
SEC. 3. Section 1371.9 is added to the Health and Safety Code, to
read:
1371.9. (a) (1) A health care service plan contract issued,
amended, or renewed on or after January July
1, 2016, shall provide that that,
except as provided in subdivision (d), if an enrollee
obtains care receives covered services from a
contracting health facility at which, or as a result of which, the
enrollee receives services provided by a noncontracting individual
health professional, the enrollee shall pay the noncontracting
individual health professional no more than the same cost sharing
that the enrollee would have paid pay
for the same covered benefits services
received from a contracting individual health professional. This
amount shall be referred to as the "in-network cost sharing."
(2) At the time of payment by the plan to the noncontracting
individual health professional, the plan shall inform the
noncontracting individual health professional of the in-network cost
sharing owed by the enrollee. If
(3) Except as provided in subdivision
(d), if a noncontracting individual health professional
receives reimbursement for services provided to the enrollee at a
contracting health facility from the plan, an enrollee shall not owe
the noncontracting individual health professional at the contracting
health facility more than the in-network cost sharing.
cost -sharing amount.
(3) Except as provided in subdivision (d), if the noncontracting
individual health professional collects more than the in-network cost
sharing from the enrollee, the noncontracting individual health
professional shall refund any overpayment to the enrollee within 30
working days of receiving notice from the plan of the in-network cost
sharing amount owed by the enrollee pursuant to paragraph (2). If
the noncontracting individual health professional does not refund any
overpayment within 30 working days after being informed of the
enrollee's in-network cost sharing, interest shall accrue at the rate
of 15 percent per annum beginning with the first calendar day after
the 30-working day period. A noncontracting individual health
professional shall automatically include in his or her refund of the
overpayment all interest that has accrued pursuant to this section
without requiring the enrollee to submit a request for the interest
amount.
(4) If the noncontracting individual health professional has
advanced to collections any amount owed by the enrollee, the plan
shall not reimburse the noncontracting individual health professional
for services provided to the enrollee by the noncontracting
individual health professional at a contracting health facility. In
submitting a claim to the plan, the noncontracting individual health
professional at a contracting health facility shall affirm in writing
that he or she has not advanced to collections any payment owed by
the enrollee. A noncontracting individual health professional shall
not attempt to collect more than the in-network cost sharing from the
enrollee after receiving payment from the plan. Once the
noncontracting individual health professional receives payment from
the plan, the noncontracting individual health professional may
advance to collections any in-network cost sharing owed by the
enrollee if the enrollee fails to pay the in-network cost sharing
after the plan has informed the noncontracting individual health
professional of the amount owed by the enrollee pursuant to paragraph
(2).
(4) Except as provided in subdivision (d), a noncontracting
individual health professional shall not bill or collect any amount
from the enrollee except the in-network cost-sharing amount.
(5) A noncontracting individual health professional shall not bill
or collect any amount from the enrollee until the noncontracting
individual health professional is informed of the in-network
cost-sharing amount pursuant to paragraph (2).
(6) In submitting a claim to the plan, the noncontracting
individual health professional at a contracting health facility shall
affirm in writing that he or she has not attempted to collect any
payment other than in-network cost sharing owed by the enrollee.
(7) (A) If the noncontracting individual health professional has
collected more from the enrollee than the in-network cost sharing,
the noncontracting individual health professional shall refund any
overpayment to the enrollee within 30 business days of receiving
notice from the plan of the in-network cost-sharing amount owed by
the enrollee pursuant to paragraph (2).
(B) If the noncontracting individual health professional does not
refund an overpayment to the enrollee within 30 business days after
being informed of the enrollee's in-network cost sharing, interest
shall accrue at the rate of 15 percent per annum beginning with the
first calendar day after the 30-business day period.
(C) A noncontracting individual health professional shall
automatically include in his or her overpayment refund to the
enrollee all interest that has accrued pursuant to this section
without requiring the enrollee to submit a request for the interest
amount.
(8) A noncontracting individual health professional may advance to
collections only the in-network cost sharing, as determined by the
plan pursuant to paragraph (2), that the enrollee has failed to pay.
(b) (1) Any cost sharing paid by the enrollee for the services
provided by a noncontracting individual health professional at the
contracting health facility shall count toward the limit on annual
out-of-pocket expenses established under Section 1367.006.
(2) Cost sharing arising from services received by a
noncontracting individual health professional at a contracting health
facility shall be counted toward any deductible in the same manner
as cost sharing would be attributed to a contracting individual
health professional.
(c) For purposes of this section, the following definitions shall
apply:
(1) "Cost sharing" includes any copayment, coinsurance, or
deductible, or any other form of cost sharing paid by the enrollee
other than premium or share of premium.
(2) "Health facility" "Contracting health
facility" means a health facility provider who is
licensed by this state to deliver or furnish health care services. A
health facility shall include that is contracted with
the enrollee's health care service plan to provide services under the
enrollee's plan contract. A contracting health care facility
includes, but is not be limited to, the following providers:
(A) Licensed hospital.
(B) Skilled nursing facility.
(C) Ambulatory surgery. surgery or other
outpatient setting, as described in Section 1248.1.
(D) Laboratory.
(E) Radiology or imaging.
(F) Facilities providing mental health or substance abuse
treatment.
(G) Any other provider as the department may by regulation define
as a health facility for purposes of this section.
(3) "Individual health professional" means a physician or surgeon
or other professional who is licensed by this state to deliver or
furnish health care services.
(d) An enrollee may voluntarily consent to the use of a
noncontracting individual health professional. For purposes of this
section, consent shall be voluntary if at least 24 hours in advance
of the receipt of services, the enrollee is provided a written
estimate of the cost of care by the noncontracting individual health
professional and the enrollee consents in writing to both the use of
a noncontracting individual health professional and payment of the
estimated additional cost for the services to be provided by the
noncontracting individual health professional. The consent shall
inform the enrollee that the cost of the services of the
noncontracting individual health professional will not accrue to the
limit on annual out-of-pocket expenses or the enrollee's deductible,
if any.
(4) "Noncontracting 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 not
contracted with the enrollee's health care service plan.
(d) A noncontracting individual health professional may bill or
collect from an enrollee the out of network cost sharing, if
applicable, or more than the in-network cost sharing for nonemergency
health services provided in a contracting health facility only when
the enrollee consents in writing and the written consent demonstrates
satisfaction of all of the following criteria:
(1) The enrollee initiated the request for the identified
nonemergency health services from the identified noncontracting
individual provider.
(2) At least three business days in advance of care, the enrollee
consented in writing consistent with this subdivision to the use of
the identified noncontracting individual health professional.
(3) At the time of consent under this subdivision, the
noncontracting individual health professional gave the enrollee a
written estimate of the enrollee's total out-of-pocket cost of care.
(4) The written consent under this subdivision advises the
enrollee that he or she may contact the enrollee's health care
service plan in order to arrange to receive the health service from a
contracted provider for lower out-of-pocket costs.
(5) The written consent and estimate are provided to the enrollee
in the language spoken by the enrollee.
(e) This section shall not be construed to require a plan to cover
services or provide benefits that are not otherwise covered
under that are not required by law or by the
terms and conditions of the plan contract.
(f) This section shall not be construed to exempt a plan or
provider from the requirements under Section 1371.4 or 1373.96 nor
abrogate the holding in Prospect Medical Group v. Northridge
Emergency Medical Group et al., (2009) 45 Cal.4th 497, that an
emergency room physician is prohibited from billing an enrollee of a
health care service plan directly for sums that the health care
service plan has failed to pay for the enrollee's emergency room
treatment.
(g) 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.
(h) This section shall not apply to a Medi-Cal managed health care
service plan or any other entity that enters into a contract with
the State Department of Health Care Services pursuant to Chapter 7
(commencing with Section 14000) of, 14000),
Chapter 8 (commencing with Section 14200) of,
14200), and Chapter 8.75 (commencing with
Section 14591) Part 3 of Division 9 of the Welfare and Institutions
Code.
(i) This section shall not apply to emergency services and care,
as defined in Section 1317.1.
SEC. 4. Section 10112.8 is added to the Insurance Code, to read:
10112.8. (a) (1) A health insurance policy issued, amended, or
renewed on or after January July 1,
2016, shall provide that that, except as
provided in subdivision (d), if an insured obtains care from a
contracting health facility at which, or as a result of which, the
insured receives services provided by a noncontracting individual
health professional, the insured shall pay the noncontracting
individual health professional no more than the same cost sharing
that the insured would have paid pay
for the same covered benefits services
received from a contracting individual health professional. This
amount shall be referred to as the "in-network cost sharing."
(2) At the time of payment by the health insurer to the
noncontracting individual health professional, the health insurer
shall inform the noncontracting individual health professional of the
in-network cost sharing owed by the insured. If
(3) Except as provided in subdivision
(d), if a noncontracting individual health professional
receives reimbursement for services provided to the insured at a
contracting health facility from the health insurer, an insured shall
not owe the noncontracting individual health professional at the
contracting health facility more than the in-network cost
sharing. cost -sharing amount.
(3) Except as provided in subdivision (d), if the noncontracting
individual health professional collects more than the in-network cost
sharing from the insured, the noncontracting individual health
professional shall refund any overpayment to the insured within 30
working days of receiving notice from the health insurer of the
in-network cost sharing amount owed by the insured pursuant to
paragraph (2). If the noncontracting individual health professional
does not refund any overpayment within 30 working days after being
informed of the insured's in-network cost sharing, interest shall
accrue at the rate of 15 percent per annum beginning with the first
calendar day after the 30-working day period. A noncontracting
individual health professional shall automatically include in his or
her refund of the overpayment all interest that has accrued pursuant
to this section without requiring the insured to submit a request for
the interest amount.
(4) If the noncontracting individual health professional has
advanced to collections any amount owed by the insured, the health
insurer shall not reimburse the noncontracting individual health
professional for services provided to the insured by the
noncontracting individual health professional at a contracting health
facility. In submitting a claim to the health insurer, the
noncontracting individual health professional at a contracting health
facility shall affirm in writing that he or she has not advanced to
collections any payment owed by the insured. A noncontracting
individual health professional shall not attempt to collect more than
the in-network cost sharing from the insured after receiving payment
from the health insurer. Once the noncontracting individual health
professional receives payment from the health insurer, the
noncontracting individual health professional may advance to
collections any in-network cost sharing owed by the insured if the
insured fails to pay the in-network cost sharing after the health
insurer has informed the noncontracting individual health
professional of the amount owed by the insured pursuant to paragraph
(2).
(5)
(4) This section shall only apply to a health insurer
that enters into a contract with a professional or institutional
provider to provide services at alternative rates of payment pursuant
to Section 10133.
(5) Except as provided in subdivision (d), a noncontracting
individual health professional shall not bill or collect any amount
from the insured except the in-network cost-sharing amount.
(6) A noncontracting individual health professional shall not bill
or collect any amount from the insured until the noncontracting
individual health professional is informed of the in-network
cost-sharing amount pursuant to paragraph (2).
(7) In submitting a claim to the insurer, the noncontracting
individual health professional at a contracting health facility shall
affirm in writing that he or she has not attempted to collect any
payment other than in-network cost sharing owed by the insured.
(8) (A) If the noncontracting individual health professional has
collected more from the insured than the in-network cost sharing, the
noncontracting individual health professional shall refund any
overpayment to the insured within 30 business days of receiving
notice from the plan of the in-network cost-sharing amount owed by
the insured pursuant to paragraph (2).
(B) If the noncontracting individual health professional does not
refund an overpayment to the insured within 30 business days after
being informed of the insured's in-network cost sharing, interest
shall accrue at the rate of 15 percent per annum beginning with the
first calendar day after the 30-business day period.
(C) A noncontracting individual health professional shall
automatically include in his or her overpayment refund to the insured
all interest that has accrued pursuant to this section without
requiring the insured to submit a request for the interest amount.
(9) A noncontracting individual health professional may advance to
collections only the in-network cost sharing, as determined by the
plan pursuant to paragraph (2), that the insured has failed to pay.
(b) (1) Any cost sharing paid by the insured for the services
provided by a noncontracting individual health professional at the
contracting health facility shall count toward the limit on annual
out-of-pocket expenses established under Section 10112.28.
(2) Cost sharing arising from services received by a
noncontracting individual health professional at a contracting health
facility shall be counted toward any deductible in the same manner
as cost sharing would be attributed to a contracting individual
health professional.
(c) For purposes of this section, the following definitions shall
apply:
(1) "Cost sharing" includes any copayment, coinsurance, or
deductible, or any other form of cost sharing paid by the insured
other than premium or share of premium.
(2) "Health facility" "Contracting
health facility" means a health facility provider
who is licensed by this state to deliver or furnish health care
services. A health facility shall include that is
contracted with the insured's health insurer to provide services
under the insured's policy. A contracting health facility includes,
but is not limited to, the following providers:
(A) Licensed hospital.
(B) Skilled nursing facility.
(C) Ambulatory surgery. surgery or other
outpatient setting, as described in Section 1248.1 of the Health and
Safety Code.
(D) Laboratory.
(E) Radiology or imaging.
(F) Facilities providing mental health or substance abuse
treatment.
(G) Any other provider as the commissioner may by regulation
define as a health facility for purposes of this section.
(3) "Individual health professional" means a physician or
and surgeon or other professional who is
licensed by this state to deliver or furnish health care services.
(d) An insured may voluntarily consent to the use of a
noncontracting individual health professional. For purposes of this
section, consent shall be voluntary if at least
24 hours in advance of the receipt of services,
the insured is provided a written estimate of the cost of care by the
noncontracting individual health professional and the insured
consents in writing to both the use of a noncontracting individual
health professional and payment of the estimated additional cost for
the services to be provided by the noncontracting individual health
professional. The consent shall inform the insured that the cost of
the services of the noncontracting individual health professional
will not accrue to the limit on annual out-of-pocket expenses or the
insured's deductible, if any.
(4) "Noncontracting individual health professional" means a
physician or surgeon or other professional who is licensed by the
state to deliver or furnish health care services and who is not
contracted with the insured's health insurer.
(d) A noncontracting individual health professional may bill or
collect from an insurer the out of network cost sharing, if
applicable, or more than the in-network cost sharing for nonemergency
health services provided in a contracting health facility only when
the insured consents in writing and the written consent demonstrates
satisfaction of all of the following criteria:
(1) The insured initiated the request for the identified
nonemergency health services from the identified noncontracting
individual provider.
(2) At least three business days in advance of care, the insured
consented in writing consistent with this subdivision to the use of
the identified noncontracting individual health professional.
(3) At the time of consent under this subdivision, the
noncontracting individual health professional gave the insured a
written estimate of the enrollee's total out-of-pocket cost of care.
(4) The written consent under this subdivision advises the insured
that he or she may contact the insured's health care service plan in
order to arrange to receive the health service from a contracted
provider for lower out-of-pocket costs.
(5) The written consent and estimate are provided to the insured
in the language spoken by the insured.
(e) This section shall not be construed to require an insurer to
cover services or provide benefits that are not otherwise
covered under not required by law or by the
terms and conditions of the policy.
(f) This section shall not be construed to exempt a health insurer
from the requirements under Section 10112.7 or Section 10133.56.
(g) This section shall not apply to emergency services and care,
as defined in Section 1317.1.
SEC. 5. Section 10112.81 is added to the Insurance Code, to read:
10112.81. (a) (1) The commissioner shall establish an independent
dispute resolution process for the purpose of processing and
resolving a claim dispute between an insurer and a noncontracting
individual health professional for services subject to Section
10112.8.
(2) If either the noncontracting individual health professional or
the insurer appeals a claim to the department's independent dispute
resolution process, the other party shall participate in the appeal
process as described in this section.
(b) The commissioner and the Department of Managed Health
Care shall jointly shall establish uniform
written procedures for the submission, receipt, processing, and
resolution of claim payment disputes pursuant to this
section. section, and any other guideline for
implementing this article.
(c) The commissioner may contract with one or more independent
organizations that specialize in dispute resolution
to conduct the proceedings. The independent organization
handling a dispute shall be independent of either party to the
dispute. The commissioner shall establish conflict-of-interest
standards, consistent with the purposes of this section, that an
organization shall meet in order to qualify for participation in the
independent dispute resolution program. The commissioner may contract
with the same independent organization or organizations as the
Department of Managed Health Care.
(d) The determination obtained through the independent dispute
resolution process shall be binding on both parties.
(e) This section shall not apply to emergency services and care,
as defined in Section 1317.1 of the Health and Safety Code.
SEC. 6. Section 10112.82 is added to the Insurance Code, to read:
10112.82. (a) (1) A health insurer shall maintain statistically
credible information, updated at least annually, regarding rates paid
to currently contracting individual health professionals or a group
of professionals who provide similar services and are practicing in
the same or a similar geographic area as the noncontracting
individual health professional.
(2) If a health insurer does not pay a statistically significant
number or dollar amount of claims for covered services in order to
maintain the statistically credible information required by paragraph
(1), the health insurer shall demonstrate to the department that it
has access to a statistically credible database reflecting reasonable
rates paid to providers for services provided in the same or a
similar geographic area.
(3) The statistically credible information required by paragraphs
(1) and (2) shall be confidential and shall be exempt from public
disclosure.
(b) (1) Unless otherwise provided in this section or otherwise
agreed to by the noncontracting individual health professional and
the insurer, the insurer shall base reimbursement of noncontracted
claims for services rendered according to Section 10112.81 on the
average rates based on the statistically credible information with
regard to the amount paid to contracted individual health
professionals who are providing similar services and practicing in
the same or similar geographic area.
10112.82. (a) For services rendered subject to
Section 10112.8, unless otherwise agreed to by the noncontracting
individual health professional and the insurer, the insurer shall
base reimbursement for covered services on the amount the individual
health professional would have been reimbursed by Medicare for the
same or similar services in the general geographic area in which the
services were rendered.
(2)
(b) If nonemergency services are provided by a
noncontracting individual health professional
professional, pursuant to subdivision (d) of Section 10112.8,
to an insured who has voluntarily chosen to use his or her
out-of-network benefit for services covered by a preferred provider
organization or a point-of-service plan, unless otherwise agreed to
by the insurer and the noncontracting individual health professional,
the amount paid shall be the amount set forth in the insured's
evidence of coverage.
(3)
(c) A noncontracting individual health professional who
disputes the claim reimbursement shall utilize the independent
dispute resolution process described in Section 10112.81.
(c)
(d) A payment made by a health insurer to a
noncontracting health care professional for nonemergency services as
required by Section 10112.81 and this section, in addition to the
applicable cost sharing owed by the insured, shall constitute payment
in full for the nonemergency services rendered.
(d)
(e) This section shall not apply to a Medicare plan or
a Medicare supplemental plan.
(e)
(f) This section shall not apply to emergency services
and care, as defined in Section 1317.1 of the Health and Safety Code.
SEC. 7. The Legislature finds and declares that
Sections 2 and 6 of this act, which add Section 1371.31 to the
Health and Safety Code and Section 10112.82 to the Insurance Code,
impose a limitation on the public's right of access to the meetings
of public bodies or the writings of public officials and agencies
within the meaning of Section 3 of Article I of the California
Constitution. Pursuant to that constitutional provision, the
Legislature makes the following findings to demonstrate the interest
protected by this limitation and the need for protecting that
interest:
In order to protect confidential and proprietary information, it
is necessary for that information to remain confidential.
SEC. 8. 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.
