Bill Text: CA SB1446 | 2013-2014 | Regular Session | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Health care coverage: small employer market.
Spectrum: Bipartisan Bill
Status: (Passed) 2014-07-07 - Chaptered by Secretary of State. Chapter 84, Statutes of 2014. [SB1446 Detail]
Download: California-2013-SB1446-Amended.html
Bill Title: Health care coverage: small employer market.
Spectrum: Bipartisan Bill
Status: (Passed) 2014-07-07 - Chaptered by Secretary of State. Chapter 84, Statutes of 2014. [SB1446 Detail]
Download: California-2013-SB1446-Amended.html
BILL NUMBER: SB 1446 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 28, 2014
AMENDED IN SENATE MARCH 25, 2014
INTRODUCED BY Senator DeSaulnier
FEBRUARY 21, 2014
An act to add Section 1367.012 to the Health and Safety Code, and
to add Section 10112.300 to the Insurance Code, relating to health
care coverage, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 1446, as amended, DeSaulnier. Health care coverage.
coverage: small employer market.
Existing federal law, the federal Patient Protection and
Affordable Care Act (PPACA), enacts various health care coverage
market reforms that take effect with respect to plan years on or
after January 1, 2014. Among other things, PPACA requires each health
insurance issuer that offers health insurance coverage in the
individual or group market in a state to accept every employer and
individual in the state that applies for that coverage and to renew
that coverage at the option of the plan sponsor or the individual.
PPACA prohibits a group health plan and a health insurance issuer
offering group or individual health insurance coverage from imposing
any preexisting condition exclusion with respect to that plan or
coverage. PPACA allows the premium rate charged by a health insurance
issuer offering small group or individual coverage to vary only by
rating area, age, tobacco use, and whether the coverage is for an
individual or family and prohibits discrimination against individuals
based on health status. PPACA requires a health insurance issuer
that offers coverage in the small group or individual market to
ensure that the coverage includes the essential health benefits
package, as defined. However, guidance issued under PPACA grants
transitional relief to health insurance coverage in the individual or
small group market for policies that have issued or will
issue in 2014 that are renewed on or before in effect
on October 1, 2013, that are renewed for a policy year starting
between January 1, 2014, and October 1, 2016, and exempts that
coverage from certain PPACA reforms, as specified.
Existing law, the Knox-Keene Health Care Service Plan Act of 1975
(Knox-Keene Act), provides for the licensure and regulation of health
care service plans by the Department of Managed Health Care.
Existing law also provides for the regulation of health insurers by
the Department of Insurance. Existing law implements the PPACA
reforms described above under the Knox-Keene Act and the laws
governing health insurance.
This bill would allow a small employer health care service plan
contract or a small employer health benefit plan, as
defined, insurance policy that is
was in effect on October 1, 2013, that is still
in effect as of the effective date of this act, and that
does not qualify as a grandfathered health plan under PPACA ,
to be renewed until October 1, 2016, and to continue to be in
force until September 30, 2017. The bill would exempt those health
care service plan contracts and health benefit plans
insurance policies from various provisions of
state law that implement the PPACA reforms described above and
would require that the contracts and policies be amended to comply
with those provisions by October 1, 2017, in order to remain in force
on and after tha t date . The bill would require
that these provisions be implemented only to the extent permitted by
PPACA.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1367.012 is added to the Health and Safety
Code, to read:
1367.012. (a) (1) A small employer health
care service plan contract in effect on October 1, 2013,
including those renewed by December 31, 2013, and still in
effect as of the effective date of this section, that does not
qualify as a grandfathered health plan under Section 1251 of PPACA
may be renewed until October 1, 2016, and may continue to be in force
until September 30, 2017, subject to applicable federal law, and any
other requirements imposed by this chapter.
(2) A small employer health care service plan contract described
in paragraph (1) may continue to be in force after September 30,
2017, if the contract is amended to comply with all of the provisions
listed in subdivision (e) by October 1, 2017, and complies with all
other applicable provisions of law.
(b) Prior to renewing a small employer health care service plan
contract pursuant to paragraph (1) of subdivision (a), the
health care service plan shall provide notice to the group
contractholder regarding the option to renew coverage pursuant to
subdivision (a) using the relevant notice attached to the guidance
entitled "Industry "Insurance Standards
Bulletin Series - Extension of Transition Policy through October 1,
2016," issued by the United States Department of Health and Human
Services, Centers for Medicare and Medicaid Services on March 5,
2014.
(c) A small employer health care service plan contract in effect
on October 1, 2013, including those renewed by December 31,
2013, and still in effect as of the effective date of this
section, that does not qualify as a grandfathered health plan under
Section 1251 of PPACA that is renewed on or before October 1, 2016,
and that continues to be in force until no later than September 30,
2017, is exempt from the following provisions:
(1) Subdivision Paragraphs (1)
and (2) of subdivision (a) of, and subdivisions (e) and (i) of
, Section 1357.503.
(2) Section 1357.512.
(3) Subdivision (a) of Section 1357.503.
(4) Subdivision (e) of Section 1357.503.
(5) Section 1365.
(6) Section 1367.005.
(3) Sections 1367.005. and 1357.508.
(7)
(4) Section 1367.0065 for health care service
plan contracts renewed on or after January 1, 2014, and Section
1367.006 for health care service plan contracts renewed after January
1, 2015. 1367.0065.
(5) Section 1367.006.
(8)
(6) Section 1367.007.
(9)
(7) Section 1367.009.
(d) A small employer health care service plan contract described
in paragraph (1) of subdivision (a) shall
continue to be subject to the following provisions: be
subject to Sections 1357.12 and 1357.13, and shall continue to be
subject to Article 3.16 (commencing with Section 1357.500), except as
provided in subdivision (c), and to all otherwise applicable
provisions of this chapter.
(1) Sections 1357.12 and 1357.13.
(2) Subdivision (a) of Section 1357.506 and Section 1357.51.
(3) Subdivision (h) of Section 1357.503 and Section 1357.52.
(4) Subdivision (b) of Section 1357.506 and paragraph (1) of
subdivision (c) of Section 1357.51.
(5) Section 1357.514.
(e) No later than October 1, 2017, a small employer health care
service plan contract described in paragraph (1) of subdivision (a)
may be amended to comply with all of the following:
(1) Paragraphs (1) and (2) of subdivision (a) of, and subdivisions
(e) and (i) of, Section 1357.503.
(2) Section 1357.512.
(3) Sections 1357.508 and 1367.005.
(4) Section 1367.006.
(5) Section 1367.007.
(6) Section 1367.009.
(e)
(f) This section shall be implemented only to the
extent permitted by PPACA.
(f)
(g) For purposes of this section, the following
definitions shall apply:
(1) "PPACA" means the federal Patient Protection and Affordable
Care Act (Public Law 111-148), as amended by the federal Health Care
and Education Reconciliation Act of 2010 (Public Law 111-152), and
any rules, regulations, or guidance issued pursuant to that law.
(2) "Small employer health care service plan contract" means a
group health care service plan contract , other than a
specialized health care service plan contract, issued to a
small employer, as defined in subdivision (s) of Section 1357.500.
SEC. 2. Section 10112.300 is added to the Insurance Code, to read:
10112.300. (a) (1) A small employer health
benefit plan in effect on October 1, 2013, including those
renewed by December 31, 2013, and still in effect as of the
effective date of this section, that does not qualify as a
grandfathered health plan under Section 1251 of PPACA may be renewed
until October 1, 2016, and may continue to be in force until
September 30, 2017, subject to applicable federal law, and any other
requirements imposed by this part.
(2) A small employer health benefit plan described in paragraph
(1) may continue to be in force after September 30, 2017, if the plan
is amended to comply with all of the provisions listed in
subdivision (e) by October 1, 2017, and complies with all other
applicable provisions of law.
(b) Prior to renewing a small employer health benefit plan
pursuant to paragraph (1) of subdivision (a), the insurer
shall provide notice to the group contractholder regarding the option
to renew coverage pursuant to subdivision (a) using the relevant
notice attached to the guidance entitled "Industry
"Insurance Standards Bulletin Series - Extension of
Transition Policy through October 1, 2016," issued by the United
States Department of Health and Human Services, Centers for Medicare
and Medicaid Services on March 5, 2014.
(c) A small employer health benefit plan in effect on October 1,
2013, including those renewed by December 31, 2013, and
still in effect as of the effective date of this section, that does
not qualify as a grandfathered health plan under Section 1251 of
PPACA that is renewed on or before October 1, 2016, and that
continues to be in force until no later than September 30, 2017, is
exempt from the following provisions:
(1) Subdivision (k) of Paragraph
(1) of subdivision (b) of, and subdivisions (c), (g), and (k)
of, Section 10753.05.
(2) Section 10753.14.
(3) Paragraph (1) of subdivision (b) of Section 10753.05 and
subdivision (c) of Section 10753.05.
(4) Subdivision (g) of Section 10753.05.
(5) Section 10753.13.
(6)
(3) Section 10112.27.
(7)
(4) Section 10112.285 for policies renewed on
or after January 1, 2014, and Section 10112.28 for policies renewed
on or after January 1, 2015. 10112.285.
(5) Section 10112.28.
(8)
(6) Section 10112.29.
(9)
(7) Section 10112.297.
(d) A small employer health benefit plan described in
paragraph (1) of subdivision (a) shall continue to be
subject to the following provisions: be subject to
Sections 10714 and 10715, and shall continue to be subject to Chapter
8.01 (commencing with Section 10753), except as provided in
subdivision (c), and to all otherwise applicable provisions of this
part.
(1) Sections 10714 and 10715.
(2) Sections 10753.08 and 10198.7.
(3) Subdivision (j) of Section 10753.05 and Section 10198.9.
(4) Subdivision (b) of Section 10753.08 and paragraph (1) of
subdivision (c) of Section 10198.7.
(5) Section 10753.16.
(e) No later than October 1, 2017, a small employer health benefit
plan described in paragraph (1) of subdivision (a) may be amended to
comply with all of the following:
(1) Paragraph (1) of subdivision (b) of, and subdivisions (c),
(g), and (k) of, Section 10753.05.
(2) Section 10753.14.
(3) Section 10112.27.
(4) Section 10112.28.
(5) Section 10112.29.
(6) Section 10112.297.
(e)
(f) This section shall be implemented only to the
extent permitted by PPACA.
(f)
(g) For purposes of this section, the following
definitions shall apply:
(1) "Health benefit plan" has the same meaning as defined in
subdivision (j) of Section 10753.
(2) "PPACA" means the federal Patient Protection and Affordable
Care Act (Public Law 111-148), as amended by the federal Health Care
and Education Reconciliation Act of 2010 (Public Law 111-152), and
any rules, regulations, or guidance issued pursuant to that law.
(3) "Small employer health benefit plan" means a group health
benefit plan issued to a small employer, as defined in Section 10753.
SEC. 3. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to carry out the extended transitional policy under the
federal Patient Protection and Affordable Care Act (Public Law
111-148) announced by the United States Department of Health
and Human Services, Centers for Medicare and Medicaid Services on
March 5, 2014, and to allow small businesses to re-enroll in their
current health care coverage in 2014, it is necessary that this act
take effect immediately.
