Bill Text: CA SB20 | 2013-2014 | Regular Session | Amended
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Individual health care coverage: enrollment periods.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2014-06-16 - Chaptered by Secretary of State. Chapter 24, Statutes of 2014. [SB20 Detail]
Download: California-2013-SB20-Amended.html
Bill Title: Individual health care coverage: enrollment periods.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2014-06-16 - Chaptered by Secretary of State. Chapter 24, Statutes of 2014. [SB20 Detail]
Download: California-2013-SB20-Amended.html
BILL NUMBER: SB 20 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 1, 2014
AMENDED IN ASSEMBLY APRIL 9, 2014
AMENDED IN SENATE FEBRUARY 14, 2013
INTRODUCED BY Senator Hernandez
DECEMBER 3, 2012
An act to amend Section 100503 of the Government Code, to
amend Sections 1348.95 and Section 1399.849 of
the Health and Safety Code, and to amend Sections 10127.19
and Section 10965.3 of the Insurance Code,
relating to health care coverage.
LEGISLATIVE COUNSEL'S DIGEST
SB 20, as amended, Hernandez. Health care coverage.
Individual health care coverage: enrollment periods.
Existing federal law, the federal Patient Protection and
Affordable Care Act (PPACA), enacts various health care coverage
market reforms that take effect 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 also requires each state
to, by January 1, 2014, establish an American Health Benefit Exchange
that facilitates the purchase of qualified health plans by qualified
individuals and qualified small employers, as specified.
Existing law establishes the California Health Benefit Exchange
within state government, specifies the powers and duties of the board
governing the Exchange, and requires the board to facilitate the
purchase of qualified health plans through the Exchange by qualified
individuals and small employers. Existing law requires the board to
undertake activities necessary to market and publicize the
availability of health care coverage and federal subsidies through
the Exchange and to undertake outreach and enrollment activities that
seek to assist with enrolling in the Exchange in the least
burdensome manner. Existing law also requires the board of the
Exchange to annually prepare a written report on the implementation
and performance of the Exchange functions during the preceding fiscal
year, as specified, and requires that this report be submitted to
the Legislature and the Governor and be made available to the public
on the Internet Web site of the Exchange.
This bill would require the annual report to also include an
assessment of how the Exchange is performing compared to its
operational and service principles for its Internet Web site and
customer service center, a summary of the Exchange's outreach
strategy for the enrollment of consumers with limited English
language proficiency and insufficient access to the Internet, and the
total number of covered lives under qualified health plans purchased
through the Exchange, as well as specified additional data regarding
those lives.
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 also provides for the
regulation of health insurers by the Department of Insurance.
Existing law requires a health care service plan or health insurer,
on and after October 1, 2013, to offer, market, and sell all of the
plan's insurer's health benefit plans that are sold in the individual
market for policy years on or after January 1, 2014, to all
individuals and dependents in each service area in which the plan or
insurer provides or arranges for the provision of health care
services, as specified, but requires plans and insurers to limit
enrollment in individual health benefit plans to specified open
enrollment and special enrollment periods. Existing law requires a
plan or insurer to provide an initial open enrollment period from
October 1, 2013, to March 31, 2014, inclusive, and annual enrollment
periods for plan years on or after January 1, 2015, from October 15
to December 7, inclusive, of the preceding calendar year.
This bill would authorize the Exchange to modify the
initial open enrollment period and the first annual enrollment period
to the extent permitted by PPACA, and would require individual
health benefit plans to comply with those modifications whether
offered inside or outside the Exchange require a plan
or insurer to provide an annual enrollment period for the
policy year beginning on January 1, 2015, from November 15, 2014, to
February 15, 2015, inclusive .
Existing law requires a health care service plan or health insurer
to annually report, by March 31, the number of enrollees by product
type as of December 31 of the prior year that receive coverage under
a plan contract or health insurance policy that covers individuals,
small groups, large groups, or administrative services only business
lines. Existing law requires that plans and insurers include the
enrollment data in specific products types as determined by the
department.
This bill would instead specify those product types and would also
require plans and insurers to report their enrollment in
nongrandfathered coverage by coverage tier, if applicable, and by
whether the coverage was purchased through the Exchange or outside
the Exchange. The bill would also require a plan offering individual
plan contracts or a health insurer offering individual health
insurance policies to, by May 1, 2014, or within 30 days after the
end of the initial open enrollment period described above, report to
the department the plan's or insurer's enrollment as of March 31,
2014, or the end of the initial open enrollment period, whichever
date is later, by product type, coverage tier, age and gender, and
whether coverage was purchased inside or outside the Exchange, as
specified. The bill would require the departments to report this data
to the fiscal and appropriate policy committees of the Legislature
by June 1, 2014, or within 60 days of the end of the initial open
enrollment period, whichever date is later.
Because a willful violation of the bill's requirements
that requirement 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 100503 of the Government
Code, as amended by Section 4 of Chapter 5 of the First Extraordinary
Session of the Statutes of 2013, is amended to read:
100503. In addition to meeting the minimum requirements of
Section 1311 of the federal act, the board shall do all of the
following:
(a) Determine the criteria and process for eligibility,
enrollment, and disenrollment of enrollees and potential enrollees in
the Exchange and coordinate that process with the state and local
government entities administering other health care coverage
programs, including the State Department of Health Care Services, the
Managed Risk Medical Insurance Board, and California counties, in
order to ensure consistent eligibility and enrollment processes and
seamless transitions between coverage.
(b) Develop processes to coordinate with the county entities that
administer eligibility for the Medi-Cal program and the entity that
determines eligibility for the Healthy Families Program, including,
but not limited to, processes for case transfer, referral, and
enrollment in the Exchange of individuals applying for assistance to
those entities, if allowed or required by federal law.
(c) Determine the minimum requirements a carrier must meet to be
considered for participation in the Exchange, and the standards and
criteria for selecting qualified health plans to be offered through
the Exchange that are in the best interests of qualified individuals
and qualified small employers. The board shall consistently and
uniformly apply these requirements, standards, and criteria to all
carriers. In the course of selectively contracting for health care
coverage offered to qualified individuals and qualified small
employers through the Exchange, the board shall seek to contract with
carriers so as to provide health care coverage choices that offer
the optimal combination of choice, value, quality, and service.
(d) Provide, in each region of the state, a choice of qualified
health plans at each of the five levels of coverage contained in
subsections (d) and (e) of Section 1302 of the federal act.
(e) Require, as a condition of participation in the Exchange,
carriers to fairly and affirmatively offer, market, and sell in the
Exchange at least one product within each of the five levels of
coverage contained in subsections (d) and (e) of Section 1302 of the
federal act. The board may require carriers to offer additional
products within each of those five levels of coverage. This
subdivision shall not apply to a carrier that solely offers
supplemental coverage in the Exchange under paragraph (10) of
subdivision (a) of Section 100504.
(f) (1) Except as otherwise provided in this section and Section
100504.5, require, as a condition of participation in the Exchange,
carriers that sell any products outside the Exchange to do both of
the following:
(A) Fairly and affirmatively offer, market, and sell all products
made available to individuals in the Exchange to individuals
purchasing coverage outside the Exchange.
(B) Fairly and affirmatively offer, market, and sell all products
made available to small employers in the Exchange to small employers
purchasing coverage outside the Exchange.
(2) For purposes of this subdivision, "product" does not include
contracts entered into pursuant to Part 6.2 (commencing with Section
12693) of Division 2 of the Insurance Code between the Managed Risk
Medical Insurance Board and carriers for enrolled Healthy Families
beneficiaries or contracts entered into pursuant to Chapter 7
(commencing with Section 14000) of, or Chapter 8 (commencing with
Section 14200) of, Part 3 of Division 9 of the Welfare and
Institutions Code between the State Department of Health Care
Services and carriers for enrolled Medi-Cal beneficiaries. "Product"
also does not include a bridge plan product offered pursuant to
Section 100504.5.
(3) Except as required by Section 1301(a)(1)(C)(ii) of the federal
act, a carrier offering a bridge plan product in the Exchange may
limit the products it offers in the Exchange solely to a bridge plan
product contract.
(g) Determine when an enrollee's coverage commences and the extent
and scope of coverage.
(h) Provide for the processing of applications and the enrollment
and disenrollment of enrollees.
(i) Determine and approve cost-sharing provisions for qualified
health plans.
(j) Establish uniform billing and payment policies for qualified
health plans offered in the Exchange to ensure consistent enrollment
and disenrollment activities for individuals enrolled in the
Exchange.
(k) Undertake activities necessary to market and publicize the
availability of health care coverage and federal subsidies through
the Exchange. The board shall also undertake outreach and enrollment
activities that seek to assist enrollees and potential enrollees with
enrolling and reenrolling in the Exchange in the least burdensome
manner, including populations that may experience barriers to
enrollment, such as the disabled and those with limited English
language proficiency.
(l) Select and set performance standards and compensation for
navigators selected under subdivision (l) of Section 100502.
(m) Employ necessary staff.
(1) The board shall hire a chief fiscal officer, a chief
operations officer, a director for the SHOP Exchange, a director of
Health Plan Contracting, a chief technology and information officer,
a general counsel, and other key executive positions, as determined
by the board, who shall be exempt from civil service.
(2) (A) The board shall set the salaries for the exempt positions
described in paragraph (1) and subdivision (i) of Section 100500 in
amounts that are reasonably necessary to attract and retain
individuals of superior qualifications. The salaries shall be
published by the board in the board's annual budget. The board's
annual budget shall be posted on the Internet Web site of the
Exchange. To determine the compensation for these positions, the
board shall cause to be conducted, through the use of independent
outside advisors, salary surveys of both of the following:
(i) Other state and federal health insurance exchanges that are
most comparable to the Exchange.
(ii) Other relevant labor pools.
(B) The salaries established by the board under subparagraph (A)
shall not exceed the highest comparable salary for a position of that
type, as determined by the surveys conducted pursuant to
subparagraph (A).
(C) The Department of Human Resources shall review the methodology
used in the surveys conducted pursuant to subparagraph (A).
(3) The positions described in paragraph (1) and subdivision (i)
of Section 100500 shall not be subject to otherwise applicable
provisions of the Government Code or the Public Contract Code and,
for those purposes, the Exchange shall not be considered a state
agency or public entity.
(n) Assess a charge on the qualified health plans offered by
carriers that is reasonable and necessary to support the development,
operations, and prudent cash management of the Exchange. This charge
shall not affect the requirement under Section 1301 of the federal
act that carriers charge the same premium rate for each qualified
health plan whether offered inside or outside the Exchange.
(o) Authorize expenditures, as necessary, from the California
Health Trust Fund to pay program expenses to administer the Exchange.
(p) Keep an accurate accounting of all activities, receipts, and
expenditures, and annually submit to the United States Secretary of
Health and Human Services a report concerning that accounting.
Commencing January 1, 2016, the board shall conduct an annual audit.
(q) (1) (A) Notwithstanding Section 10231.5, annually prepare a
written report on the implementation and performance of the Exchange
functions during the preceding fiscal year, including, at a minimum,
all of the following:
(i) The manner in which funds were expended and the progress
toward, and the achievement of, the requirements of this title.
(ii) Data provided by health care service plans and health
insurers offering bridge plan products regarding the extent of health
care provider and health facility overlap in their Medi-Cal networks
as compared to the health care provider and health facility networks
contracting with the plan or insurer in their bridge plan contracts.
(iii) An assessment of how the Exchange is performing compared to
its operational and service principles for its Internet Web site and
customer service center. If the Exchange determines that it is not
meeting those operational and service principles, the report shall
also include a plan describing how the Exchange intends to meet those
principles.
(iv) A summary of the Exchange's outreach strategy for the
enrollment of consumers with limited English language proficiency.
(v) A summary of the Exchange's outreach strategy for the
enrollment of consumers lacking sufficient access to the Internet.
(vi) The total number of lives covered under qualified health
plans purchased through the Exchange as of the end of the immediately
preceding fiscal year.
(vii) The percentage of lives reported under clause (vi) receiving
a premium tax credit under Section 36B of the federal Internal
Revenue Code of 1986.
(viii) The percentage of lives reported under clause (vi) enrolled
in each of the levels of coverage identified in Sections 1367.008
and 1367.009 of the Health and Safety Code and Sections 10112.295 and
10112.297 of the Insurance Code.
(ix) The age, race, and ethnicity of the lives reported under
clause (vi).
(B) The report required by this paragraph shall be transmitted to
the Legislature and the Governor and shall be made available to the
public on the Internet Web site of the Exchange. A report made to the
Legislature pursuant to this paragraph shall be submitted pursuant
to Section 9795.
(2) The Exchange shall prepare, or contract for the preparation
of, an evaluation of the bridge plan program using the first three
years of experience with the program. The evaluation shall be
provided to the health policy and fiscal committees of the
Legislature in the fourth year following federal approval of the
bridge plan option. The evaluation shall include, but not be limited
to, all of the following:
(A) The number of individuals eligible to participate in the
bridge plan program each year by category of eligibility.
(B) The number of eligible individuals who elect a bridge plan
option each year by category of eligibility.
(C) The average length of time, by region and statewide, that
individuals remain in the bridge plan option each year by category of
eligibility.
(D) The regions of the state with a bridge plan option, and the
carriers in each region that offer a bridge plan, by year.
(E) The premium difference each year, by region, between the
bridge plan and the first and second lowest cost plan for individuals
in the Exchange who are not eligible for the bridge plan.
(F) The effect of the bridge plan on the premium subsidy amount
for bridge plan eligible individuals each year by each region.
(G) Based on a survey of individuals enrolled in the bridge plan:
(i) Whether individuals enrolling in the bridge plan product are
able to keep their existing health care providers.
(ii) Whether individuals would want to retain their bridge plan
product, buy a different Exchange product, or decline to purchase
health insurance if there was no bridge plan product available. The
Exchange may include questions designed to elicit the information in
this subparagraph as part of an existing survey of individuals
receiving coverage in the Exchange.
(3) In addition to the evaluation required by paragraph (2), the
Exchange shall post the items in subparagraphs (A) to (F), inclusive,
on its Internet Web site each year.
(4) In addition to the report described in paragraph (1), the
board shall be responsive to requests for additional information from
the Legislature, including providing testimony and commenting on
proposed state legislation or policy issues. The Legislature finds
and declares that activities including, but not limited to,
responding to legislative or executive inquiries, tracking and
commenting on legislation and regulatory activities, and preparing
reports on the implementation of this title and the performance of
the Exchange, are necessary state requirements and are distinct from
the promotion of legislative or regulatory modifications referred to
in subdivision (d) of Section 100520.
(r) Maintain enrollment and expenditures to ensure that
expenditures do not exceed the amount of revenue in the fund, and if
sufficient revenue is not available to pay estimated expenditures,
institute appropriate measures to ensure fiscal solvency.
(s) Exercise all powers reasonably necessary to carry out and
comply with the duties, responsibilities, and requirements of this
act and the federal act.
(t) Consult with stakeholders relevant to carrying out the
activities under this title, including, but not limited to, all of
the following:
(1) Health care consumers who are enrolled in health plans.
(2) Individuals and entities with experience in facilitating
enrollment in health plans.
(3) Representatives of small businesses and self-employed
individuals.
(4) The State Medi-Cal Director.
(5) Advocates for enrolling hard-to-reach populations.
(u) Facilitate the purchase of qualified health plans in the
Exchange by qualified individuals and qualified small employers no
later than January 1, 2014.
(v) Report, or contract with an independent entity to report, to
the Legislature by December 1, 2018, on whether to adopt the option
in Section 1312(c)(3) of the federal act to merge the individual and
small employer markets. In its report, the board shall provide
information, based on at least two years of data from the Exchange,
on the potential impact on rates paid by individuals and by small
employers in a merged individual and small employer market, as
compared to the rates paid by individuals and small employers if a
separate individual and small employer market is maintained. A report
made pursuant to this subdivision shall be submitted pursuant to
Section 9795.
(w) With respect to the SHOP Program, collect premiums and
administer all other necessary and related tasks, including, but not
limited to, enrollment and plan payment, in order to make the
offering of employee plan choice as simple as possible for qualified
small employers.
(x) Require carriers participating in the Exchange to immediately
notify the Exchange, under the terms and conditions established by
the board when an individual is or will be enrolled in or disenrolled
from any qualified health plan offered by the carrier.
(y) Ensure that the Exchange provides oral interpretation services
in any language for individuals seeking coverage through the
Exchange and makes available a toll-free telephone number for the
hearing and speech impaired. The board shall ensure that written
information made available by the Exchange is presented in a plainly
worded, easily understandable format and made available in prevalent
languages.
(z) This section shall become inoperative on the October 1 that is
five years after the date that federal approval of the bridge plan
option occurs, and, as of the second January 1 thereafter, is
repealed, unless a later enacted statute that is enacted before that
date deletes or extends the dates on which it becomes inoperative and
is repealed.
SEC. 2. Section 100503 of the Government Code,
as added by Section 5 of Chapter 5 of the First Extraordinary Session
of the Statutes of 2013, is amended to read:
100503. In addition to meeting the minimum requirements of
Section 1311 of the federal act, the board shall do all of the
following:
(a) Determine the criteria and process for eligibility,
enrollment, and disenrollment of enrollees and potential enrollees in
the Exchange and coordinate that process with the state and local
government entities administering other health care coverage
programs, including the State Department of Health Care Services, the
Managed Risk Medical Insurance Board, and California counties, in
order to ensure consistent eligibility and enrollment processes and
seamless transitions between coverage.
(b) Develop processes to coordinate with the county entities that
administer eligibility for the Medi-Cal program and the entity that
determines eligibility for the Healthy Families Program, including,
but not limited to, processes for case transfer, referral, and
enrollment in the Exchange of individuals applying for assistance to
those entities, if allowed or required by federal law.
(c) Determine the minimum requirements a carrier must meet to be
considered for participation in the Exchange, and the standards and
criteria for selecting qualified health plans to be offered through
the Exchange that are in the best interests of qualified individuals
and qualified small employers. The board shall consistently and
uniformly apply these requirements, standards, and criteria to all
carriers. In the course of selectively contracting for health care
coverage offered to qualified individuals and qualified small
employers through the Exchange, the board shall seek to contract with
carriers so as to provide health care coverage choices that offer
the optimal combination of choice, value, quality, and service.
(d) Provide, in each region of the state, a choice of qualified
health plans at each of the five levels of coverage contained in
subsections (d) and (e) of Section 1302 of the federal act.
(e) Require, as a condition of participation in the Exchange,
carriers to fairly and affirmatively offer, market, and sell in the
Exchange at least one product within each of the five levels of
coverage contained in subsections (d) and (e) of Section 1302 of the
federal act. The board may require carriers to offer additional
products within each of those five levels of coverage. This
subdivision shall not apply to a carrier that solely offers
supplemental coverage in the Exchange under paragraph (10) of
subdivision (a) of Section 100504.
(f) (1) Require, as a condition of participation in the Exchange,
carriers that sell any products outside the Exchange to do both of
the following:
(A) Fairly and affirmatively offer, market, and sell all products
made available to individuals in the Exchange to individuals
purchasing coverage outside the Exchange.
(B) Fairly and affirmatively offer, market, and sell all products
made available to small employers in the Exchange to small employers
purchasing coverage outside the Exchange.
(2) For purposes of this subdivision, "product" does not include
contracts entered into pursuant to Part 6.2 (commencing with Section
12693) of Division 2 of the Insurance Code between the Managed Risk
Medical Insurance Board and carriers for enrolled Healthy Families
beneficiaries or contracts entered into pursuant to Chapter 7
(commencing with Section 14000) of, or Chapter 8 (commencing with
Section 14200) of, Part 3 of Division 9 of the Welfare and
Institutions Code between the State Department of Health Care
Services and carriers for enrolled Medi-Cal beneficiaries.
(g) Determine when an enrollee's coverage commences and the extent
and scope of coverage.
(h) Provide for the processing of applications and the enrollment
and disenrollment of enrollees.
(i) Determine and approve cost-sharing provisions for qualified
health plans.
(j) Establish uniform billing and payment policies for qualified
health plans offered in the Exchange to ensure consistent enrollment
and disenrollment activities for individuals enrolled in the
Exchange.
(k) Undertake activities necessary to market and publicize the
availability of health care coverage and federal subsidies through
the Exchange. The board shall also undertake outreach and enrollment
activities that seek to assist enrollees and potential enrollees with
enrolling and reenrolling in the Exchange in the least burdensome
manner, including populations that may experience barriers to
enrollment, such as the disabled and those with limited English
language proficiency.
(l) Select and set performance standards and compensation for
navigators selected under subdivision (l) of Section 100502.
(m) Employ necessary staff.
(1) The board shall hire a chief fiscal officer, a chief
operations officer, a director for the SHOP Exchange, a director of
Health Plan Contracting, a chief technology and information officer,
a general counsel, and other key executive positions, as determined
by the board, who shall be exempt from civil service.
(2) (A) The board shall set the salaries for the exempt positions
described in paragraph (1) and subdivision (i) of Section 100500 in
amounts that are reasonably necessary to attract and retain
individuals of superior qualifications. The salaries shall be
published by the board in the board's annual budget. The board's
annual budget shall be posted on the Internet Web site of the
Exchange. To determine the compensation for these positions, the
board shall cause to be conducted, through the use of independent
outside advisors, salary surveys of both of the following:
(i) Other state and federal health insurance exchanges that are
most comparable to the Exchange.
(ii) Other relevant labor pools.
(B) The salaries established by the board under subparagraph (A)
shall not exceed the highest comparable salary for a position of that
type, as determined by the surveys conducted pursuant to
subparagraph (A).
(C) The Department of Human Resources shall review the methodology
used in the surveys conducted pursuant to subparagraph (A).
(3) The positions described in paragraph (1) and subdivision (i)
of Section 100500 shall not be subject to otherwise applicable
provisions of the Government Code or the Public Contract Code and,
for those purposes, the Exchange shall not be considered a state
agency or public entity.
(n) Assess a charge on the qualified health plans offered by
carriers that is reasonable and necessary to support the development,
operations, and prudent cash management of the Exchange. This charge
shall not affect the requirement under Section 1301 of the federal
act that carriers charge the same premium rate for each qualified
health plan whether offered inside or outside the Exchange.
(o) Authorize expenditures, as necessary, from the California
Health Trust Fund to pay program expenses to administer the Exchange.
(p) Keep an accurate accounting of all activities, receipts, and
expenditures, and annually submit to the United States Secretary of
Health and Human Services a report concerning that accounting.
Commencing January 1, 2016, the board shall conduct an annual audit.
(q) (1) (A) Notwithstanding Section 10231.5, annually prepare a
written report on the implementation and performance of the Exchange
functions during the preceding fiscal year, including, at a minimum,
all of the following:
(i) The manner in which funds were expended and the progress
toward, and the achievement of, the requirements of this
title.
(ii) An assessment of how the Exchange is performing compared to
its operational and service principles for its Internet Web site and
customer service center. If the Exchange determines that it is not
meeting those operational and service principles, the report shall
also include a plan describing how the Exchange intends to meet those
principles.
(iii) A summary of the Exchange's outreach strategy for the
enrollment of consumers with limited English language proficiency.
(iv) A summary of the Exchange's outreach strategy for the
enrollment of consumers lacking sufficient access to the Internet.
(v) The total number of lives covered under qualified health plans
purchased through the Exchange as of the end of the immediately
preceding fiscal year.
(vi) The percentage of lives reported under clause (v) receiving a
premium tax credit under Section 36B of the federal Internal Revenue
Code of 1986.
(vii) The percentage of lives reported under clause (v) enrolled
in each of the levels of coverage identified in Sections 1367.008 and
1367.009 of the Health and Safety Code and Sections 10112.295 and
10112.297 of the Insurance Code.
(viii) The age, race, and ethnicity of the lives reported under
clause (v).
(B) The report required by this paragraph shall be transmitted to
the Legislature and the Governor and shall be made available to the
public on the Internet Web site of the Exchange. A report made to the
Legislature pursuant to this paragraph shall be submitted pursuant
to Section 9795.
(2) In addition to the report described in paragraph (1), the
board shall be responsive to requests for additional information from
the Legislature, including providing testimony and commenting on
proposed state legislation or policy issues. The Legislature finds
and declares that activities including, but not limited to,
responding to legislative or executive inquiries, tracking and
commenting on legislation and regulatory activities, and preparing
reports on the implementation of this title and the performance of
the Exchange, are necessary state requirements and are distinct from
the promotion of legislative or regulatory modifications referred to
in subdivision (d) of Section 100520.
(r) Maintain enrollment and expenditures to ensure that
expenditures do not exceed the amount of revenue in the fund, and if
sufficient revenue is not available to pay estimated expenditures,
institute appropriate measures to ensure fiscal solvency.
(s) Exercise all powers reasonably necessary to carry out and
comply with the duties, responsibilities, and requirements of this
act and the federal act.
(t) Consult with stakeholders relevant to carrying out the
activities under this title, including, but not limited to, all of
the following:
(1) Health care consumers who are enrolled in health plans.
(2) Individuals and entities with experience in facilitating
enrollment in health plans.
(3) Representatives of small businesses and self-employed
individuals.
(4) The State Medi-Cal Director.
(5) Advocates for enrolling hard-to-reach populations.
(u) Facilitate the purchase of qualified health plans in the
Exchange by qualified individuals and qualified small employers no
later than January 1, 2014.
(v) Report, or contract with an independent entity to report, to
the Legislature by December 1, 2018, on whether to adopt the option
in Section 1312(c)(3) of the federal act to merge the individual and
small employer markets. In its report, the board shall provide
information, based on at least two years of data from the Exchange,
on the potential impact on rates paid by individuals and by small
employers in a merged individual and small employer market, as
compared to the rates paid by individuals and small employers if a
separate individual and small employer market is maintained. A report
made pursuant to this subdivision shall be submitted pursuant to
Section 9795.
(w) With respect to the SHOP Program, collect premiums and
administer all other necessary and related tasks, including, but not
limited to, enrollment and plan payment, in order to make the
offering of employee plan choice as simple as possible for qualified
small employers.
(x) Require carriers participating in the Exchange to immediately
notify the Exchange, under the terms and conditions established by
the board when an individual is or will be enrolled in or disenrolled
from any qualified health plan offered by the carrier.
(y) Ensure that the Exchange provides oral interpretation services
in any language for individuals seeking coverage through the
Exchange and makes available a toll-free telephone number for the
hearing and speech impaired. The board shall ensure that written
information made available by the Exchange is presented in a plainly
worded, easily understandable format and made available in prevalent
languages.
(z) This section shall become operative only if Section 4 of the
act that added this section becomes inoperative pursuant to
subdivision (z) of that Section 4.
SEC. 3. Section 1348.95 of the Health and
Safety Code is amended to read:
1348.95. (a) (1) Commencing March 1, 2013, and at least annually
thereafter, every health care service plan, shall report to the
department, in a form and manner determined by the department in
consultation with the Department of Insurance, the plan's enrollment
under its plan contracts, excluding specialized health care service
plan contracts, that cover individuals, small groups, large groups,
or administrative services only business lines as of December 31 of
the immediately preceding year. This report shall, at a minimum,
include the following information:
(A) The plan's enrollment in nongrandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other), coverage tier (catastrophic, bronze-HSA, bronze, silver-HSA,
silver, gold, or platinum), if applicable, and whether the coverage
was purchased through the Exchange or outside the Exchange.
(B) The plan's enrollment in grandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other).
(2) The department shall publicly report the data provided by each
health care service plan pursuant to this subdivision, including,
but not limited to, posting the data on the department's Internet Web
site.
(b) (1) In addition to the report required under subdivision (a),
by May 1, 2014, or within 30 days after the end of the initial open
enrollment period described in subdivision (c) of Section 1399.849,
whichever date is later, a health care service plan offering
individual health care service plan contracts shall report to the
department, in a form and manner determined by the department in
consultation with the Department of Insurance, the plan's enrollment
under its individual health care service plan contracts, excluding
specialized health care service plan contracts, as of March 31, 2014,
or the date on which the initial open enrollment period described in
subdivision (c) of Section 1399.849 ends, whichever date is later.
The report shall, at a minimum, include the following information:
(A) The plan's enrollment in nongrandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other), coverage tier (catastrophic, bronze-HSA, bronze, silver-HSA,
silver, gold, or platinum), age and gender, and whether the coverage
was purchased through the Exchange or outside the Exchange.
(B) The plan's enrollment in grandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other) and by age and gender.
(2) (A) By June 1, 2014, or within 60 days after the end of the
initial open enrollment period described in subdivision (c) of
Section 1399.849, whichever date is later, the department shall
report to the fiscal and appropriate policy committees of the
Legislature, and post publicly on the department's Internet Web site,
the enrollment data submitted by each health care service plan
pursuant to this subdivision.
(B) The requirement for submitting a report to the fiscal and
appropriate policy committees of the Legislature under this paragraph
is inoperative four years after the date on which the report
required under this paragraph is due, pursuant to Section 10231.5 of
the Government Code.
(c) The department shall consult with the Department of Insurance
to ensure that the data collected and reported pursuant to this
section is comparable and consistent and utilizes existing reporting
formats to the extent feasible.
(d) For purposes of this section, the following definitions shall
apply:
(1) "Exchange" means the California Health Benefit Exchange
established under Section 100500 of the Government Code.
(2) "Grandfathered coverage" means coverage that constitutes a
grandfathered health plan under Section 1251 of 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) "Nongrandfathered coverage" means coverage that does not
constitute grandfathered coverage.
SEC. 4. SECTION 1. Section 1399.849
of the Health and Safety Code is amended to read:
1399.849. (a) (1) On and after October 1, 2013, a plan shall
fairly and affirmatively offer, market, and sell all of the plan's
health benefit plans that are sold in the individual market for
policy years on or after January 1, 2014, to all individuals and
dependents in each service area in which the plan provides or
arranges for the provision of health care services. A plan shall
limit enrollment in individual health benefit plans to open
enrollment periods, annual enrollment periods, and special enrollment
periods as provided in subdivisions (c) and (d).
(2) A plan shall allow the subscriber of an individual health
benefit plan to add a dependent to the subscriber's plan at the
option of the subscriber, consistent with the open enrollment, annual
enrollment, and special enrollment period requirements in this
section.
(b) An individual health benefit plan issued, amended, or renewed
on or after January 1, 2014, shall not impose any preexisting
condition provision upon any individual.
(c) (1) A plan shall provide an initial open enrollment period
from October 1, 2013, to March 31, 2014, inclusive, an annual
enrollment period for the policy year beginning on January 1, 2015,
from November 15, 2014, to February 15, 2015, inclusive, and
annual enrollment periods for policy years beginning on or after
January 1, 2015, 2016, from October 15
to December 7, inclusive, of the preceding calendar year ,
subject to paragraph (3) .
(2) Pursuant to Section 147.104(b)(2) of Title 45 of the Code of
Federal Regulations, for individuals enrolled in noncalendar year
individual health plan contracts, a plan shall also provide a limited
open enrollment period beginning on the date that is 30 calendar
days prior to the date the policy year ends in 2014.
(3) To the extent permitted by PPACA, the Exchange may, by
regulation, modify the initial open enrollment period and the annual
enrollment period for the policy year beginning on January 1, 2015. A
health benefit plan offered in the individual market shall comply
with those modifications regardless of whether the plan is offered
inside or outside the Exchange. A regulation adopted pursuant to this
paragraph shall be considered by the Office of Administrative Law to
be necessary for the immediate preservation of the public peace,
health and safety, and general welfare, and may be adopted as an
emergency regulation in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
(d) (1) Subject to paragraph (2), commencing January 1, 2014, a
plan shall allow an individual to enroll in or change individual
health benefit plans as a result of the following triggering events:
(A) He or she or his or her dependent loses minimum essential
coverage. For purposes of this paragraph, the following definitions
shall apply:
(i) "Minimum essential coverage" has the same meaning as that term
is defined in subsection (f) of Section 5000A of the Internal
Revenue Code (26 U.S.C. Sec. 5000A).
(ii) "Loss of minimum essential coverage" includes, but is not
limited to, loss of that coverage due to the circumstances described
in Section 54.9801-6(a)(3)(i) to (iii), inclusive, of Title 26 of the
Code of Federal Regulations and the circumstances described in
Section 1163 of Title 29 of the United States Code. "Loss of minimum
essential coverage" also includes loss of that coverage for a reason
that is not due to the fault of the individual.
(iii) "Loss of minimum essential coverage" does not include loss
of that coverage due to the individual's failure to pay premiums on a
timely basis or situations allowing for a rescission, subject to
clause (ii) and Sections 1389.7 and 1389.21.
(B) He or she gains a dependent or becomes a dependent.
(C) He or she is mandated to be covered as a dependent pursuant to
a valid state or federal court order.
(D) He or she has been released from incarceration.
(E) His or her health coverage issuer substantially violated a
material provision of the health coverage contract.
(F) He or she gains access to new health benefit plans as a result
of a permanent move.
(G) He or she was receiving services from a contracting provider
under another health benefit plan, as defined in Section 1399.845 or
Section 10965 of the Insurance Code, for one of the conditions
described in subdivision (c) of Section 1373.96 and that provider is
no longer participating in the health benefit plan.
(H) He or she demonstrates to the Exchange, with respect to health
benefit plans offered through the Exchange, or to the department,
with respect to health benefit plans offered outside the Exchange,
that he or she did not enroll in a health benefit plan during the
immediately preceding enrollment period available to the individual
because he or she was misinformed that he or she was covered under
minimum essential coverage.
(I) He or she is a member of the reserve forces of the United
States military returning from active duty or a member of the
California National Guard returning from active duty service under
Title 32 of the United States Code.
(J) With respect to individual health benefit plans offered
through the Exchange, in addition to the triggering events listed in
this paragraph, any other events listed in Section 155.420(d) of
Title 45 of the Code of Federal Regulations.
(2) With respect to individual health benefit plans offered
outside the Exchange, an individual shall have 60 days from the date
of a triggering event identified in paragraph (1) to apply for
coverage from a health care service plan subject to this section.
With respect to individual health benefit plans offered through the
Exchange, an individual shall have 60 days from the date of a
triggering event identified in paragraph (1) to select a plan offered
through the Exchange, unless a longer period is provided in Part 155
(commencing with Section 155.10) of Subchapter B of Subtitle A of
Title 45 of the Code of Federal Regulations.
(e) With respect to individual health benefit plans offered
through the Exchange, the effective date of coverage required
pursuant to this section shall be consistent with the dates specified
in Section 155.410 or 155.420 of Title 45 of the Code of Federal
Regulations, as applicable. A dependent who is a registered domestic
partner pursuant to Section 297 of the Family Code shall have the
same effective date of coverage as a spouse.
(f) With respect to individual health benefit plans offered
outside the Exchange, the following provisions shall apply:
(1) After an individual submits a completed application form for a
plan contract, the health care service plan shall, within 30 days,
notify the individual of the individual's actual premium charges for
that plan established in accordance with Section 1399.855. The
individual shall have 30 days in which to exercise the right to buy
coverage at the quoted premium charges.
(2) With respect to an individual health benefit plan for which an
individual applies during the initial open enrollment period
described in subdivision (c), when the subscriber submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs earlier, by December 15,
2013, coverage under the individual health benefit plan shall become
effective no later than January 1, 2014. When that payment is
delivered or postmarked within the first 15 days of any subsequent
month, coverage shall become effective no later than the first day of
the following month. When that payment is delivered or postmarked
between December 16, 2013, and December 31, 2013, inclusive, or after
the 15th day of any subsequent month, coverage shall become
effective no later than the first day of the second month following
delivery or postmark of the payment.
(3) With respect to an individual health benefit plan for which an
individual applies during the annual open enrollment period
described in subdivision (c), when the individual submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs later, by December 15,
coverage shall become effective as of the following January 1. When
that payment is delivered or postmarked within the first 15 days of
any subsequent month, coverage shall become effective no later than
the first day of the following month. When that payment is delivered
or postmarked between December 16 and December 31, inclusive, or
after the 15th day of any subsequent month, coverage shall become
effective no later than the first day of the second month following
delivery or postmark of the payment.
(4) With respect to an individual health benefit plan for which an
individual applies during a special enrollment period described in
subdivision (d), the following provisions shall apply:
(A) When the individual submits a premium payment, based on the
quoted premium charges, and that payment is delivered or postmarked,
whichever occurs earlier, within the first 15 days of the month,
coverage under the plan shall become effective no later than the
first day of the following month. When the premium payment is neither
delivered nor postmarked until after the 15th day of the month,
coverage shall become effective no later than the first day of the
second month following delivery or postmark of the payment.
(B) Notwithstanding subparagraph (A), in the case of a birth,
adoption, or placement for adoption, the coverage shall be effective
on the date of birth, adoption, or placement for adoption.
(C) Notwithstanding subparagraph (A), in the case of marriage or
becoming a registered domestic partner or in the case where a
qualified individual loses minimum essential coverage, the coverage
effective date shall be the first day of the month following the date
the plan receives the request for special enrollment.
(g) (1) A health care service plan shall not establish rules for
eligibility, including continued eligibility, of any individual to
enroll under the terms of an individual health benefit plan based on
any of the following factors:
(A) Health status.
(B) Medical condition, including physical and mental illnesses.
(C) Claims experience.
(D) Receipt of health care.
(E) Medical history.
(F) Genetic information.
(G) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(H) Disability.
(I) Any other health status-related factor as determined by any
federal regulations, rules, or guidance issued pursuant to Section
2705 of the federal Public Health Service Act.
(2) Notwithstanding Section 1389.1, a health care service plan
shall not require an individual applicant or his or her dependent to
fill out a health assessment or medical questionnaire prior to
enrollment under an individual health benefit plan. A health care
service plan shall not acquire or request information that relates to
a health status-related factor from the applicant or his or her
dependent or any other source prior to enrollment of the individual.
(h) (1) A health care service plan shall consider as a single risk
pool for rating purposes in the individual market the claims
experience of all insureds and enrollees in all nongrandfathered
individual health benefit plans offered by that health care service
plan in this state, whether offered as health care service plan
contracts or individual health insurance policies, including those
insureds and enrollees who enroll in individual coverage through the
Exchange and insureds and enrollees who enroll in individual coverage
outside of the Exchange. Student health insurance coverage, as that
coverage is defined in Section 147.145(a) of Title 45 of the Code of
Federal Regulations, shall not be included in a health care service
plan's single risk pool for individual coverage.
(2) Each calendar year, a health care service plan shall establish
an index rate for the individual market in the state based on the
total combined claims costs for providing essential health benefits,
as defined pursuant to Section 1302 of PPACA, within the single risk
pool required under paragraph (1). The index rate shall be adjusted
on a marketwide basis based on the total expected marketwide payments
and charges under the risk adjustment and reinsurance programs
established for the state pursuant to Sections 1343 and 1341 of
PPACA. The premium rate for all of the health care service plan's
health benefit plans in the individual market shall use the
applicable index rate, as adjusted for total expected marketwide
payments and charges under the risk adjustment and reinsurance
programs established for the state pursuant to Sections 1343 and 1341
of PPACA, subject only to the adjustments permitted under paragraph
(3).
(3) A health care service plan may vary premium rates for a
particular health benefit plan from its index rate based only on the
following actuarially justified plan-specific factors:
(A) The actuarial value and cost-sharing design of the health
benefit plan.
(B) The health benefit plan's provider network, delivery system
characteristics, and utilization management practices.
(C) The benefits provided under the health benefit plan that are
in addition to the essential health benefits, as defined pursuant to
Section 1302 of PPACA and Section 1367.005. These additional benefits
shall be pooled with similar benefits within the single risk pool
required under paragraph (1) and the claims experience from those
benefits shall be utilized to determine rate variations for plans
that offer those benefits in addition to essential health benefits.
(D) With respect to catastrophic plans, as described in subsection
(e) of Section 1302 of PPACA, the expected impact of the specific
eligibility categories for those plans.
(E) Administrative costs, excluding user fees required by the
Exchange.
(i) This section shall only apply with respect to individual
health benefit plans for policy years on or after January 1, 2014.
(j) This section shall not apply to an individual health benefit
plan that is a grandfathered health plan.
(k) If Section 5000A of the Internal Revenue Code, as added by
Section 1501 of PPACA, is repealed or amended to no longer apply to
the individual market, as defined in Section 2791 of the federal
Public Health Service Act (42 U.S.C. Sec. 300gg-91), subdivisions
(a), (b), and (g) shall become inoperative 12 months after that
repeal or amendment.
SEC. 5. Section 10127.19 of the Insurance Code
is amended to read:
10127.19. (a) (1) Commencing March 1, 2013, and at least annually
thereafter, every health insurer shall report to the department, in
a form and manner determined by the department in consultation with
the Department of Managed Health Care, the insurer's enrollment under
its health insurance policies, other than specialized health
insurance policies, that cover individuals, small groups, large
groups, or administrative services only business lines as of December
31 of the immediately preceding year. This report shall, at a
minimum, include the following information:
(A) The insurer's enrollment in nongrandfathered coverage by
product type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care,
or other), coverage tier (catastrophic, bronze-HSA, bronze,
silver-HSA, silver, gold, or platinum), if applicable, and whether
the coverage was purchased through the Exchange or outside the
Exchange.
(B) The insurer's enrollment in grandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other).
(2) The
department shall publicly report the data provided by each health
insurer pursuant to this subdivision, including, but not limited to,
posting the data on the department's Internet Web site.
(b) (1) In addition to the report required under subdivision (a),
by May 1, 2014, or within 30 days after the end of the initial open
enrollment period described in subdivision (c) of Section 10965.3,
whichever date is later, a health insurer offering individual health
insurance policies shall report to the department, in a form and
manner determined by the department in consultation with the
Department of Managed Health Care, the insurer's enrollment under its
individual health insurance policies, excluding specialized health
insurance policies, as of March 31, 2014, or the date on which the
initial open enrollment period described in subdivision (c) of
Section 10965.3 ends, whichever date is later. The report shall, at a
minimum, include the following information:
(A) The insurer's enrollment in nongrandfathered coverage by
product type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care,
or other), coverage tier (catastrophic, bronze-HSA, bronze,
silver-HSA, silver, gold, or platinum), age and gender, and whether
the coverage was purchased through the Exchange or outside the
Exchange.
(B) The insurer's enrollment in grandfathered coverage by product
type (HMO, point-of-service, PPO, EPO, Medi-Cal managed care, or
other) and by age and gender.
(2) (A) By June 1, 2014, or within 60 days after the end of the
initial open enrollment period described in subdivision (c) of
Section 10965.3, whichever date is later, the department shall report
to the fiscal and appropriate policy committees of the Legislature,
and post publicly on the department's Internet Web site, the
enrollment data submitted by each health insurer pursuant to this
subdivision.
(B) The requirement for submitting a report to the fiscal and
appropriate policy committees of the Legislature under this paragraph
is inoperative four years after the date on which the report
required under this paragraph is due, pursuant to Section 10231.5 of
the Government Code.
(c) The department shall consult with the Department of Managed
Health Care to ensure that the data collected and reported pursuant
to this section is comparable and consistent and utilizes existing
reporting formats to the extent feasible.
(d) For purposes of this section, the following definitions shall
apply:
(1) "Exchange" means the California Health Benefit Exchange
established under Section 100500 of the Government Code.
(2) "Grandfathered coverage" means coverage that constitutes a
grandfathered health plan under Section 1251 of 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) "Nongrandfathered coverage" means coverage that does not
constitute grandfathered coverage.
SEC. 6. SEC. 2. Section 10965.3 of
the Insurance Code is amended to read:
10965.3. (a) (1) On and after October 1, 2013, a health insurer
shall fairly and affirmatively offer, market, and sell all of the
insurer's health benefit plans that are sold in the individual market
for policy years on or after January 1, 2014, to all individuals and
dependents in each service area in which the insurer provides or
arranges for the provision of health care services. A health insurer
shall limit enrollment in individual health benefit plans to open
enrollment periods, annual enrollment periods, and special enrollment
periods as provided in subdivisions (c) and (d).
(2) A health insurer shall allow the policyholder of an individual
health benefit plan to add a dependent to the policyholder's health
benefit plan at the option of the policyholder, consistent with the
open enrollment, annual enrollment, and special enrollment period
requirements in this section.
(b) An individual health benefit plan issued, amended, or renewed
on or after January 1, 2014, shall not impose any preexisting
condition provision upon any individual.
(c) (1) A health insurer shall provide an initial open enrollment
period from October 1, 2013, to March 31, 2014, inclusive, an
annual enrollment period for the policy year beginning on January 1,
2015, from November 15, 2014, to February 15, 2015, inclusive,
and annual enrollment periods for policy years beginning on or after
January 1, 2015, 2016, from October 15
to December 7, inclusive, of the preceding calendar year ,
subject to paragraph (3) .
(2) Pursuant to Section 147.104(b)(2) of Title 45 of the Code of
Federal Regulations, for individuals enrolled in noncalendar-year
individual health plan contracts, a health insurer shall also provide
a limited open enrollment period beginning on the date that is 30
calendar days prior to the date the policy year ends in 2014.
(3) To the extent permitted by PPACA, the Exchange may, by
regulation, modify the initial open enrollment period and the annual
enrollment period for the policy year beginning on January 1, 2015. A
health benefit plan offered in the individual market shall comply
with those modifications regardless of whether the plan is offered
inside or outside the Exchange. A regulation adopted pursuant to this
paragraph shall be considered by the Office of Administrative Law to
be necessary for the immediate preservation of the public peace,
health and safety, and general welfare, and may be adopted as an
emergency regulation in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
(d) (1) Subject to paragraph (2), commencing January 1, 2014, a
health insurer shall allow an individual to enroll in or change
individual health benefit plans as a result of the following
triggering events:
(A) He or she or his or her dependent loses minimum essential
coverage. For purposes of this paragraph, both of the following
definitions shall apply:
(i) "Minimum essential coverage" has the same meaning as that term
is defined in subsection (f) of Section 5000A of the Internal
Revenue Code (26 U.S.C. Sec. 5000A).
(ii) "Loss of minimum essential coverage" includes, but is not
limited to, loss of that coverage due to the circumstances described
in Section 54.9801-6(a)(3)(i) to (iii), inclusive, of Title 26 of the
Code of Federal Regulations and the circumstances described in
Section 1163 of Title 29 of the United States Code. "Loss of minimum
essential coverage" also includes loss of that coverage for a reason
that is not due to the fault of the individual.
(iii) "Loss of minimum essential coverage" does not include loss
of that coverage due to the individual's failure to pay premiums on a
timely basis or situations allowing for a rescission, subject to
clause (ii) and Sections 10119.2 and 10384.17.
(B) He or she gains a dependent or becomes a dependent.
(C) He or she is mandated to be covered as a dependent pursuant to
a valid state or federal court order.
(D) He or she has been released from incarceration.
(E) His or her health coverage issuer substantially violated a
material provision of the health coverage contract.
(F) He or she gains access to new health benefit plans as a result
of a permanent move.
(G) He or she was receiving services from a contracting provider
under another health benefit plan, as defined in Section 10965 or
Section 1399.845 of the Health and Safety Code , for one
of the conditions described in subdivision (a) of Section 10133.56
and that provider is no longer participating in the health benefit
plan.
(H) He or she demonstrates to the Exchange, with respect to health
benefit plans offered through the Exchange, or to the department,
with respect to health benefit plans offered outside the Exchange,
that he or she did not enroll in a health benefit plan during the
immediately preceding enrollment period available to the individual
because he or she was misinformed that he or she was covered under
minimum essential coverage.
(I) He or she is a member of the reserve forces of the United
States military returning from active duty or a member of the
California National Guard returning from active duty service under
Title 32 of the United States Code.
(J) With respect to individual health benefit plans offered
through the Exchange, in addition to the triggering events listed in
this paragraph, any other events listed in Section 155.420(d) of
Title 45 of the Code of Federal Regulations.
(2) With respect to individual health benefit plans offered
outside the Exchange, an individual shall have 60 days from the date
of a triggering event identified in paragraph (1) to apply for
coverage from a health care service plan subject to this section.
With respect to individual health benefit plans offered through the
Exchange, an individual shall have 60 days from the date of a
triggering event identified in paragraph (1) to select a plan offered
through the Exchange, unless a longer period is provided in Part 155
(commencing with Section 155.10) of Subchapter B of Subtitle A of
Title 45 of the Code of Federal Regulations.
(e) With respect to individual health benefit plans offered
through the Exchange, the effective date of coverage required
pursuant to this section shall be consistent with the dates specified
in Section 155.410 or 155.420 of Title 45 of the Code of Federal
Regulations, as applicable. A dependent who is a registered domestic
partner pursuant to Section 297 of the Family Code shall have the
same effective date of coverage as a spouse.
(f) With respect to an individual health benefit plan offered
outside the Exchange, the following provisions shall apply:
(1) After an individual submits a completed application form for a
plan, the insurer shall, within 30 days, notify the individual of
the individual's actual premium charges for that plan established in
accordance with Section 10965.9. The individual shall have 30 days in
which to exercise the right to buy coverage at the quoted premium
charges.
(2) With respect to an individual health benefit plan for which an
individual applies during the initial open enrollment period
described in subdivision (c), when the policyholder submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs earlier, by December 15,
2013, coverage under the individual health benefit plan shall become
effective no later than January 1, 2014. When that payment is
delivered or postmarked within the first 15 days of any subsequent
month, coverage shall become effective no later than the first day of
the following month. When that payment is delivered or postmarked
between December 16, 2013, and December 31, 2013, inclusive, or after
the 15th day of any subsequent month, coverage shall become
effective no later than the first day of the second month following
delivery or postmark of the payment.
(3) With respect to an individual health benefit plan for which an
individual applies during the annual open enrollment period
described in subdivision (c), when the individual submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs later, by December 15,
coverage shall become effective as of the following January 1. When
that payment is delivered or postmarked within the first 15 days of
any subsequent month, coverage shall become effective no later than
the first day of the following month. When that payment is delivered
or postmarked between December 16 and December 31, inclusive, or
after the 15th day of any subsequent month, coverage shall become
effective no later than the first day of the second month following
delivery or postmark of the payment.
(4) With respect to an individual health benefit plan for which an
individual applies during a special enrollment period described in
subdivision (d), the following provisions shall apply:
(A) When the individual submits a premium payment, based on the
quoted premium charges, and that payment is delivered or postmarked,
whichever occurs earlier, within the first 15 days of the month,
coverage under the plan shall become effective no later than the
first day of the following month. When the premium payment is neither
delivered nor postmarked until after the 15th day of the month,
coverage shall become effective no later than the first day of the
second month following delivery or postmark of the payment.
(B) Notwithstanding subparagraph (A), in the case of a birth,
adoption, or placement for adoption, the coverage shall be effective
on the date of birth, adoption, or placement for adoption.
(C) Notwithstanding subparagraph (A), in the case of marriage or
becoming a registered domestic partner or in the case where a
qualified individual loses minimum essential coverage, the coverage
effective date shall be the first day of the month following the date
the insurer receives the request for special enrollment.
(g) (1) A health insurer shall not establish rules for
eligibility, including continued eligibility, of any individual to
enroll under the terms of an individual health benefit plan based on
any of the following factors:
(A) Health status.
(B) Medical condition, including physical and mental illnesses.
(C) Claims experience.
(D) Receipt of health care.
(E) Medical history.
(F) Genetic information.
(G) Evidence of insurability, including conditions arising out of
acts of domestic violence.
(H) Disability.
(I) Any other health status-related factor as determined by any
federal regulations, rules, or guidance issued pursuant to Section
2705 of the federal Public Health Service Act.
(2) Notwithstanding subdivision (c) of Section 10291.5, a health
insurer shall not require an individual applicant or his or her
dependent to fill out a health assessment or medical questionnaire
prior to enrollment under an individual health benefit plan. A health
insurer shall not acquire or request information that relates to a
health status-related factor from the applicant or his or her
dependent or any other source prior to enrollment of the individual.
(h) (1) A health insurer shall consider as a single risk pool for
rating purposes in the individual market the claims experience of all
insureds and enrollees in all nongrandfathered individual health
benefit plans offered by that insurer in this state, whether offered
as health care service plan contracts or individual health insurance
policies, including those insureds who enroll in individual coverage
through the Exchange and insureds who enroll in individual coverage
outside the Exchange. Student health insurance coverage, as such
coverage is defined at Section 147.145(a) of Title 45 of the Code of
Federal Regulations, shall not be included in a health insurer's
single risk pool for individual coverage.
(2) Each calendar year, a health insurer shall establish an index
rate for the individual market in the state based on the total
combined claims costs for providing essential health benefits, as
defined pursuant to Section 1302 of PPACA, within the single risk
pool required under paragraph (1). The index rate shall be adjusted
on a marketwide basis based on the total expected marketwide payments
and charges under the risk adjustment and reinsurance programs
established for the state pursuant to Sections 1343 and 1341 of
PPACA. The premium rate for all of the health insurer's health
benefit plans in the individual market shall use the applicable index
rate, as adjusted for total expected marketwide payments and charges
under the risk adjustment and reinsurance programs established for
the state pursuant to Sections 1343 and 1341 of PPACA, subject only
to the adjustments permitted under paragraph (3).
(3) A health insurer may vary premium rates for a particular
health benefit plan from its index rate based only on the following
actuarially justified plan-specific factors:
(A) The actuarial value and cost-sharing design of the health
benefit plan.
(B) The health benefit plan's provider network, delivery system
characteristics, and utilization management practices.
(C) The benefits provided under the health benefit plan that are
in addition to the essential health benefits, as defined pursuant to
Section 1302 of PPACA and Section 10112.27. These additional benefits
shall be pooled with similar benefits within the single risk pool
required under paragraph (1) and the claims experience from those
benefits shall be utilized to determine rate variations for plans
that offer those benefits in addition to essential health benefits.
(D) With respect to catastrophic plans, as described in subsection
(e) of Section 1302 of PPACA, the expected impact of the specific
eligibility categories for those plans.
(E) Administrative costs, excluding any user fees required by the
Exchange.
(i) This section shall only apply with respect to individual
health benefit plans for policy years on or after January 1, 2014.
(j) This section shall not apply to an individual health benefit
plan that is a grandfathered health plan.
(k) If Section 5000A of the Internal Revenue Code, as added by
Section 1501 of PPACA, is repealed or amended to no longer apply to
the individual market, as defined in Section 2791 of the federal
Public Health Service Act (42 U.S.C. Sec. 300gg-91), subdivisions
(a), (b), and (g) shall become inoperative 12 months after the date
of that repeal or amendment and individual health care benefit plans
shall thereafter be subject to Sections 10901.2, 10951, and 10953.
SEC. 7. 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.
