BILL NUMBER: ABX1 1 AMENDED
BILL TEXT
AMENDED IN SENATE JANUARY 16, 2008
AMENDED IN ASSEMBLY DECEMBER 17, 2007
AMENDED IN ASSEMBLY DECEMBER 13, 2007
AMENDED IN ASSEMBLY NOVEMBER 8, 2007
INTRODUCED BY Assembly Member Nunez
(Principal coauthor: Senator Perata)
SEPTEMBER 11, 2007
An act to amend Section 2069 of, to add Sections 4040.1, 4071.2,
4071.3, and 4071.4 to, and to add and repeal Section 2838 of, the
Business and Professions Code, to add Section 49452.9 to the
Education Code, to add Sections 12803.2, 12803.25, 22830.5, and
22830.6 to, and to add Chapter 15 (commencing with Section 8899.50)
to Division 1 of Title 2 of, the Government Code, to amend Sections
1357.54, 1365, 124900, 124905, 124910, 124920, 128745, and 128748 of,
to amend, repeal, and add Section 1399.56 of, to add Sections
1262.9, 1342.9, 1347, 1356.2, 1367.16, 1367.205, 1367.38, 1368.025,
1378.1, 1395.2, 1399.58, 104376, 124905.1, 124946, and 130545 to, to
add Chapter 1.6 (commencing with Section 155) to Part 1 of Division 1
of, to add Article 11.6 (commencing with Section 1399.820) to
Chapter 2.2 of Division 2 of, to add Article 1 (commencing with
Section 104250) to Chapter 4 of Part 1 of Division 103 of, to add
Article 3 (commencing with Section 104705) to Chapter 2 of Part 3 of
Division 103 of, and to add Chapter 4 (commencing with Section
128850) to Part 5 of Division 107 of, the Health and Safety Code, to
amend Sections 12693.43, 12693.70, 12693.73, and 12693.76 of, to
amend, repeal, and add Section 796.02 of, to add Sections 796.05,
10113.10, 10113.11, 10123.56, 10176.15, 10273.6, 12693.56, 12693.57,
12693.58, 12693.59, 12693.766, 12886, and 12887 to, to add Chapter
9.6 (commencing with Section 10919) to Part 2 of Division 2 of, and
to add Part 6.45 (commencing with Section 12699.201) and Part 6.7
(commencing with Section 12739.50) to Division 2 of, the Insurance
Code, to add Section 96.8 to the Labor Code, to amend Sections 19167
and 19611 of, to add Sections 17052.31, 17052.32, 19528.5, and
19553.5 to, and to add and repeal Section 17052.30 of, the Revenue
and Taxation Code, to add Sections 301.1 and 1120 to, and to add
Division 1.2 (commencing with Section 4800) to, the Unemployment
Insurance Code, and to amend Sections 12306.1, 14005.30, and 14011.16
of, to add Sections 14005.301, 14005.305, 14005.306, 14005.310,
14005.311, 14005.331, 14005.333, 14011.16.1, 14074.5, 14081.6,
14092.5, 14132.105, and 14137.10 to, and to add Article 5.215
(commencing with Section 14167.22) to, and to add and repeal Article
5.21 (commencing with Section 14167.1) of, Chapter 7 of Part 3 of
Division 9 of, the Welfare and Institutions Code, relating to health
care coverage.
LEGISLATIVE COUNSEL'S DIGEST
AB 1, as amended, Nunez. Health care reform.
(1) Existing law creates the California Health and Human Services
Agency.
This bill would require the agency, in consultation with the Board
of Administration of the Public Employees' Retirement System (PERS),
to assume lead agency responsibility for professional review and
development of best practice standards for high-cost chronic diseases
that state health care programs would be required to implement upon
their adoption. The bill would additionally require the agency, in
consultation with PERS and health care provider groups, to develop
health care provider performance measurement benchmarks, as
specified.
The bill, effective July 1, 2008, would create the California
Health Care Cost and Quality Transparency Committee in the California
Health and Human Services Agency, with various powers and duties,
including the development and periodic review of a health care cost
and quality transparency plan. The bill would require the Office of
Statewide Health Planning and Development to assist the committee in
that regard. The bill would require the Secretary of California
Health and Human Services to track and assess the effects of health
care reform and to report to the Legislature by March 1, 2012, and
biennially thereafter. The bill would also create the California
Health Benefits Service within the State Department of Health Care
Services, with various powers and duties relative to creation of
joint ventures between certain county-organized health plans and
various other entities. The bill would require these joint ventures
to be licensed as health care service plans and would create a
stakeholder committee.
(2) Existing law does not provide a system of health care coverage
for all California residents. Existing law does not require
employers to provide health care coverage for employees and
dependents, other than coverage provided as part of the workers'
compensation system for work-related employee injuries, and does not
require individuals to maintain health care coverage. Existing law
provides for the creation of various programs to provide health care
coverage to persons who have limited incomes and meet various
eligibility requirements. These programs include the Healthy Families
Program, administered by the Managed Risk Medical Insurance Board,
and the Medi-Cal program, administered by the State Department of
Health Care Services and county welfare departments.
This bill would require California residents, subject to certain
exceptions, to enroll in and maintain at least minimum creditable
health care coverage, as determined by the Managed Risk Medical
Insurance Board, for themselves and their dependents, as defined. The
bill would require the board to establish, by regulation, the
definition and standards for minimum creditable coverage, including
an affordability standard and hardship exemptions, by March 1, 2009,
and would require the board to facilitate enrollment in public or
private coverage and to establish an education and awareness program,
by January 1, 2010, relating to the requirement to obtain minimum
creditable coverage. The bill would enact related provisions,
including authorizing a school district, on and after January 1,
2010, to provide parents and guardians information explaining these
health care coverage requirements.
The bill would, as of January 1, 2009, create the California
Cooperative Health Insurance Purchasing Program (Cal-CHIPP), which
would function as a statewide purchasing pool for health care
coverage and be administered by the Managed Risk Medical Insurance
Board. The bill would specify eligibility for Cal-CHIPP and would
require the board to develop and offer a variety of benefit plan
designs, including the Cal-CHIPP Healthy Families plan in which
enrollment would be restricted to specified low-income persons. The
bill would authorize an employer to pay all or a part of the premium
payment required of its employees enrolled in Cal-CHIPP. The bill
would make it an unfair labor practice for an employer to refer an
employee, or his or her dependent, to Cal-CHIPP or to arrange for
their application to that program to separate them from group
coverage provided through the employment relationship, and for an
employer to change the share-of-cost ratio or modify coverage in
order for an employee or his or her dependents to enroll in that
program. Because an unfair labor practice may be punishable as a
crime, the bill would impose a state-mandated local program. The bill
would create the California Health Trust Fund in the State Treasury
for the purposes of this act. The bill would require the State
Department of Health Care Services to seek any necessary federal
approval to enable the state to receive federal Medicaid funds for
specified persons who could otherwise be made eligible for Medi-Cal
benefits, with the state share of funds to be provided from the
California Health Trust Fund. The bill, on and after July 1, 2010,
would also extend Medi-Cal benefits to parents and caretaker
relatives and various other persons meeting certain eligibility
requirements. The bill would require certain of these individuals to
receive their benefits in the form of a benchmark package, which
would be the Cal-CHIPP Healthy Families benefit package. The bill
would provide for the benchmark benefits to be administered by the
Managed Risk Medical Insurance Board, pursuant to an interagency
agreement with the department. The bill would make these provisions
subject to federal financial participation and approval, as
specified.
The bill would require the State Department of Health Care
Services to establish a Healthy Action Incentives and Rewards Program
to be provided as a covered benefit under the Medi-Cal program,
subject to federal financial participation and approval. The bill
would also require the Director of Health Care Services to establish
a local coverage option program for low-income adults that would be
the exclusive Medi-Cal coverage for a 4-year period beginning with
the program's commencement, for county residents who, among other
requirements, have a family income at or below 100% of the federal
poverty level and are not otherwise eligible for the Medi-Cal
program. The bill would specify that the program would become
operational for services rendered on or after July 1, 2010. The bill
would specify that coverage under the program would be provided at a
county's option and only by a county that operates a designated
public hospital, subject to approval by the State Department of
Health Care Services and contingent on establishment of a county
share of cost. The bill would require the State Department of Health
Care Services, by January 1, 2010, to contract with an independent
3rd party to develop an assessment tool to measure the care provided
under the program. The bill would require the department, after 3
years of the program's operation, to evaluate the program using the
assessment tool and would extend the program for an additional 2
years if the program substantially met certain criteria and would
terminate the program if it did not. The bill would enact other
related provisions.
The bill, subject to future appropriation of funds, would expand
the number of children eligible for coverage under the Healthy
Families Program on and after July 1, 2009. The bill would, on and
after July 1, 2009, delete as an eligibility requirement for a child
under the Healthy Families Program and the Medi-Cal program that the
child satisfy citizen and immigration status requirements applicable
to the programs under federal law, thereby creating a state-only
element of the programs. The bill would additionally, on and after
July 1, 2009, disregard all income over 250% but less than or equal
to 300% of the federal poverty level and would apply Medi-Cal program
income deductions to a family income greater than 300% of the
federal poverty level in determining eligibility for the Healthy
Families Program. The bill would authorize the board to provide, or
arrange for the provision of, an electronic personal health record
under the Healthy Families Program, to the extent funds are
appropriated for that purpose, and would provide for the
confidentiality of information obtained pursuant to the program.
The bill would require the department to exercise its federal
option as necessary to simplify Medi-Cal eligibility by exempting all
resources for certain applicants and recipients, commencing July 1,
2010.
The bill would enact the Medi-Cal Physician Services Rate Increase
Act, which would establish, with respect to services rendered to
Medi-Cal beneficiaries on and after July 1, 2010, to the extent funds
are appropriated in the annual Budget Act, increased reimbursements
of up to 100% of the Medicare rate for physicians, physician groups,
as defined, and others that are enrolled Medi-Cal providers eligible
to receive payments for Medi-Cal services. The bill would permit some
of these rate increases to be linked to specified performance
measures and would provide that these rate increases would be
implemented only to the extent that state funds are appropriated for
the nonfederal share of these increases. The bill would require the
Director of Health Care Services to seek federal approval of the rate
methodology set forth in the act and would prohibit the methodology
from being implemented if federal approval is not obtained.
Because each county is required to determine eligibility for the
Medi-Cal program, expansion of program eligibility would impose a
state-mandated local program.
This bill would also enact the Medi-Cal Hospital Rate
Stabilization Act, which would revise the methodology by which safety
net care pool funds are paid to designated public hospitals for
providing uncompensated care to the uninsured. The bill would require
the State Department of Health Care Services to determine an
outpatient base rate and an inpatient base rate, as defined, for
various types of hospitals. The bill would also, commencing July 1,
2010, establish specified reimbursement rate methodologies under the
Medi-Cal program for hospital services, as defined, that are rendered
by designated public hospitals and for managed health care plans, as
specified, and would require managed health care plans to expend
100% of moneys received under the increased rates for payments to
hospitals for providing services to Medi-Cal patients. The bill would
make implementation of certain of these provisions contingent on the
establishment of certain requirements under which counties pay a
share of cost for persons enrolled in the Medi-Cal program, and would
make implementation of all of these provisions contingent on the
imposition of a 4% fee on the net patient revenue of general acute
care hospitals.
This bill would also require a portion of the nonfederal share of
the reimbursement for designated public hospitals be transferred to
the Workforce Development Program Fund, which the bill would create
in the State Treasury. Moneys in the fund would, upon appropriation,
be used exclusively for retraining county hospital and clinic systems'
health care workers and be allocated by the Office of Statewide
Health Planning and Development.
(3) Existing law provides for the county administered In-Home
Supportive Services (IHSS) program, under which qualified aged,
blind, and disabled persons are provided with services in order to
permit them to remain in their own homes and avoid
institutionalization.
Existing law permits services to be provided under the IHSS
program either through the employment of individual providers, a
contract between the county and an entity for the provision of
services, the creation by the county of a public authority, or a
contract between the county and a nonprofit consortium.
Existing law provides that when any increase in provider wages or
benefits is negotiated or agreed to by a public authority or
nonprofit consortium, the county shall use county only funds for the
state and county share of any increase in the program, unless
otherwise provided in the Budget Act or appropriated by statute.
Existing law establishes a formula with regard to provider wages
or benefits increases negotiated or agreed to by a public authority
or nonprofit consortium, and specifies the percentages required to be
paid by the state and counties, beginning with the 2000-01 fiscal
year, with regard to the nonfederal share of any increases.
This bill would revise the formula for state participation in
provider health benefit increases. The bill would also authorize a
county employee representative to elect to provide health benefits
through a trust fund, as specified.
(4) 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.
This bill would enact various health insurance market reforms, to
be operative on specified dates, including requirements for guarantee
issue of individual health care service plan contracts and health
insurance policies and other requirements relating to individual
coverage, modified disclosures, and other related changes. The bill,
on and after July 1, 2010, would require at least 85% of full-service
health care service plan dues, fees, and other periodic payments and
health insurance premiums to be spent on health care benefits and
not on administrative costs. The bill would allow a health care
service plan and a health insurer to provide notices by electronic
transmission using specified procedures.
The bill would require a health care service plan providing
prescription drug benefits and maintaining a drug formulary to,
commencing on or before January 1, 2010, make the most current
formularies available electronically to prescribers and pharmacies
and would require health care service plans that provide services to
certain beneficiaries under a Medi-Cal managed care program to be
subject solely to the filing, reporting, monitoring, and survey
requirements established by the State Department of Health Care
Services for the Medi-Cal managed care program for designated
subjects. The bill would require the department and the State
Department of Health Care Services to develop a joint filing and
review process for medical quality surveys.
The bill would also require group health care service plan
contracts and group health insurance policies offered, amended, or
renewed on or after January 1, 2009, to offer to include a Healthy
Action Incentives and Rewards Program, as specified. The bill would
also authorize an employer to provide health coverage that includes a
Healthy Action Incentives and Rewards Program to his or her
employees.
Because a willful violation of the bill's requirements relative to
health care service plans would be a crime, the bill would impose a
state-mandated local program.
(5) The Personal Income Tax Law authorizes various credits against
the taxes imposed by that law.
This bill would, for taxable years beginning on or after January
1, 2010, and before January 1, 2015, allow to a qualified taxpayer,
as defined, a refundable credit against those taxes in an amount
equal to those qualified health care plan premium costs, as defined,
that are in excess of 5.5% of a qualified taxpayer's adjusted gross
income for the taxable year, except as provided. This bill would,
upon appropriation by the Legislature, require that all amounts
deposited into the California Health Trust Fund be transferred to the
Managed Risk Medical Insurance Board for purposes of advancing the
refundable credit and to the Franchise Tax Board for purposes of
recovering amounts expended for the refunds, as provided.
(6) Existing law creates the Employment Development Department in
the Labor and Workforce Development Agency and vests that department
with the duties, purposes, responsibilities, and jurisdiction
previously exercised by the State Department of Benefit Payments or
the California Health and Human Services Agency with respect to job
creation activities.
This bill would require the department to establish data
collection and reporting methods and requirements, as specified, to
collect and report information related to employer health
expenditures on behalf of their employees. The bill would require the
department to report on that data to the Managed Risk Medical
Insurance Board and the Legislature on an annual basis commencing
April 1, 2011, and would authorize the department to adopt
regulations to implement these provisions.
(7) Under existing federal law, a cafeteria plan is a written plan
through which employees choose among 2 or more benefits consisting
of cash and qualified benefits. Existing federal law provides that,
except as specified, no amount is included in the gross income of a
participant in a cafeteria plan solely because the participant may
choose among the benefits of the plan.
This bill would, beginning January 1, 2010, require an employer to
adopt and maintain a cafeteria plan to allow employees to pay
premiums for health care coverage to the extent amounts for that
coverage are excludable from the gross income of the employee, as
specified. The bill would require an employer who fails to establish
or maintain a cafeteria plan to pay a penalty of $100 or $500 per
employee, as specified.
(8) Existing law authorizes the Board of Administration of the
Public Employees' Retirement System to contract with carriers
offering health benefit plans for coverage for eligible employees and
annuitants.
This bill would require the board, on or before January 1, 2010,
to provide or arrange for the provision of an electronic personal
health record for enrollees receiving health care benefits.
(9) Existing law establishes the State Department of Public
Health, which licenses and regulates health facilities and also
administers funds for programs relating to smoking cessation. Under
existing law, a noncontracting hospital is required to contact an
enrollee's health care service plan to obtain the enrollee's medical
record information prior to admitting the enrollee for inpatient
poststabilization care, as defined, or prior to transferring the
enrollee, if certain conditions apply. Existing law prohibits the
hospital from billing the enrollee for poststabilization care if it
is required to, and fails to, contact the enrollee's health care
service plan. Under existing law, a violation of any of these
provisions is punishable as a misdemeanor.
This bill would prohibit a noncontracting hospital, as defined,
from billing a covered patient for emergency health care services and
poststabilizing care except for applicable copayments and cost
shares. By changing the definition of an existing crime, this bill
would impose a state-mandated local program.
The bill would also require the department to maintain the
California Diabetes Program to provide information and assistance
pertaining to the prevention and treatment of diabetes. The bill
would also establish the Comprehensive Diabetes Services Program in
the State Department of Health Care Services to provide diabetes
prevention and management services to certain beneficiaries in the
Medi-Cal program, to the extent funding is available for this
purpose. The bill would also require the department, in consultation
with the Department of Managed Health Care, the State Department of
Health Care Services, the Managed Risk Medical Insurance Board, and
the Department of Insurance, to annually identify the 10 largest
providers of health care coverage in the state, to ascertain and
summarize the smoking cessation benefits provided by those coverage
providers, to publish the benefit summary on the department's
Internet Web site, to include the benefit summary as part of its
preventive health education against tobacco use campaign, and to
evaluate any changes in connection with the smoking cessation
benefits provided by the coverage providers, as provided. The bill
would also require the department, to the extent that funds are
available and appropriated for this purpose, to increase the capacity
of effective smoking cessation services available from, and expand
the awareness of, services available through, the California Smokers'
Helpline, as prescribed.
The bill would also create the Community Makeover Grant program
that would be administered by the department and would require it to
award grants to local health departments in cities and counties,
which would serve as the local lead agencies in administering the
program, for the purpose of developing new programs or improving
existing programs that promote active living and healthy eating. The
bill would require the department to issue guidelines and to specify
data reporting requirements for local lead agencies to comply with
various requirements relating to the administration of the program.
The bill would also require the department to develop a sustained
media campaign to educate the public about the importance of obesity
prevention.
(10) Existing law requires the State Department of Health Care
Services to select certain primary care clinics to be reimbursed for
delivering medical services, including preventive health care and
smoking prevention and cessation health education, to program
beneficiaries, based upon specified criteria. Existing law requires
that a clinic meet specified requirements in order to receive a
reimbursement. Under existing law, a program beneficiary is a person
whose income is at or below 200% of the federal poverty level.
Existing law requires the department to utilize existing contractual
claims processing services to promote efficiency and maximize the use
of funds.
This bill would additionally require that, in order receive a
reimbursement, a clinic serve as a designated primary care medical
home for program beneficiaries, as specified. The bill would also
revise the definition of program beneficiary to mean a person whose
income is at or below 250% of the poverty level and who either does
not have private or employer-based health care coverage or is not
enrolled in or is ineligible for public health care coverage
programs. This bill would delete the provision requiring the
department to utilize existing contractual claims processing services
and instead authorize the department to contract with public and
private entities or utilize existing health care service provider
enrollment and payment mechanisms in order to perform its duties, as
specified. The bill would additionally require that the department
maximize the availability of federal funding for services provided
pursuant to these provisions. The bill would make related changes.
(11) Existing law provides for the Office of Statewide Health
Planning and Development, which has specified powers and duties.
Existing law requires the office to publish specified reports.
This bill would require the office to publish risk-adjusted
outcome reports for percutaneous coronary interventions, commencing
January 1, 2010, and would require the office to establish a clinical
data collection program to collect data on percutaneous coronary
interventions and establish by regulation the data to be reported by
each hospital.
(12) Existing law provides for the certification and regulation of
nurses, including nurse practitioners and nurse-midwives, by the
Board of Registered Nursing and for the licensure and regulation of
physician assistants by the Physician Assistant Committee of the
Medical Board of California. Existing law provides that a medical
assistant may administer medication upon the specific authorization
and supervision of a licensed physician and surgeon or licensed
podiatrist or, in specified clinic settings, upon the specific
authorization and supervision of a nurse practitioner, nurse-midwife,
or physician assistant.
This bill would remove the requirement that a medical assistant's
administration of medication upon the specific authorization and
supervision of a nurse practitioner, nurse-midwife, or physician
assistant occur in specified clinic settings, and would make related
changes.
(13) Existing law, the Nursing Practice Act, provides for the
licensure and regulation of nurse practitioners by the Board of
Registered Nursing which is within the Department of Consumer
Affairs.
This bill would, until July 1, 2011, create the Task Force on
Nurse Practitioner Scope of Practice that would consist of specified
members appointed by the Governor, the Speaker of the Assembly, and
the Senate Committee on Rules. The bill would make the task force
responsible for developing a recommended scope of practice for nurse
practitioners and would require the task force to report the
recommended scope of practice to the Governor and the Legislature on
or before June 30, 2009. The bill would require the Director of
Consumer Affairs, on or before July 1, 2010, to promulgate
regulations that adopt the recommended scope of practice. The bill
would require the aforementioned boards to pay the state
administrative costs of implementing these provisions.
(14) Existing law, the Pharmacy Law, defines an electronic
transmission prescription and sets forth the requirements for those
types of prescriptions.
This bill would require electronic prescribing systems to meet
specified standards and requirements and would require a prescriber
or prescriber's authorized agent to offer patients a written receipt
of information transmitted electronically, including the patient's
name and the drug prescribed, and would require the State Department
of Health Care Services to develop a pilot program to foster the
adoption and use of electronic prescribing by health care providers
that contract with the Medi-Cal program, as specified. The bill would
require every licensed prescriber, or prescriber's authorized agent,
or pharmacy operating in California, on or before January 1, 2010,
to have the ability to transmit and receive prescriptions by
electronic data transmission.
(15) This bill would give the State Department of Health Care
Services, in consultation with the Department of Finance, authority
to take various actions as necessary to implement the bill, including
promoting flexibility of implementation and maximizing federal
financial participation. The bill would require the Director of
Health Care Services to notify the Chair of the Joint Legislative
Budget Committee prior to exercising this flexibility. The bill would
declare the intent of the Legislature to implement the bill to
harmonize and best effectuate the purposes and intent of the bill.
(16) This
bill would declare the Legislature's intent that the act's provisions
be financed by contributions from various sources, including
payments by acute care hospitals and employers, and by increasing the
taxes on cigarettes and other tobacco products.
(17) The bill would make its provisions operative upon the date
that the Director of Finance files a finding with the Secretary of
State that, among other circumstances, sufficient state resources
will exist in the Health Care Trust Fund to implement those
provisions. The bill would also require the director to transmit that
finding to the Chief Clerk of the Assembly, the Secretary of the
Senate, and the chairs of the appropriate committees of the
Legislature at least 90 days prior to implementation of its
provisions.
(18) The bill would require that all of its provisions become
inoperative, as specified, if any portion of the bill is held to be
invalid, as determined by a final judgment of a court of competent
jurisdiction.
(19) 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 with regard to certain mandates no
reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that,
if the Commission on State Mandates determines that the bill contains
costs so mandated by the state, reimbursement for those costs shall
be made pursuant to the statutory provisions noted above.
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. This act shall be known and may be cited as the Health
Care Security and Cost Reduction Act.
SEC. 2. It is the intent of the Legislature to accomplish the goal
of universal health care for all California residents. To accomplish
this goal, the Legislature proposes to take all of the following
steps:
(a) Ensure that all Californians have access to affordable,
comprehensive health care.
(b) Leverage available federal funds to the greatest extent
possible through existing federal programs.
(c) Maintain and strengthen the health insurance system and
improve availability and affordability of private health care
coverage for all purchasers through (1) insurance market reforms; (2)
enhanced access to effective primary and preventive services,
including management of chronic illnesses; (3) promotion of
cost-effective health technologies; and (4) implementation of
meaningful, systemwide cost containment strategies.
(d) Engage in early and systematic evaluation at each step of the
implementation process to identify the impacts on state costs, the
costs of coverage, employment and insurance markets, health delivery
systems, quality of care, and overall progress in moving toward
universal coverage.
SEC. 3. Section 2069 of the Business and Professions Code is
amended to read:
2069. (a) (1) Notwithstanding any other provision of law, a
medical assistant may administer medication only by intradermal,
subcutaneous, or intramuscular injections and perform skin tests and
additional technical supportive services upon the specific
authorization and supervision of a licensed physician and surgeon,
nurse practitioner, nurse-midwife, physician assistant, or licensed
podiatrist.
(2) The licensed physician and surgeon may, at his or her
discretion, in consultation with the nurse practitioner,
nurse-midwife, or physician assistant, provide written instructions
to be followed by a medical assistant in the performance of tasks or
supportive services. These written instructions may provide that the
supervisory function for the medical assistant for these tasks or
supportive services may be delegated to the nurse practitioner,
nurse-midwife, or physician assistant within the standardized
procedures or protocol, and that tasks may be performed when the
licensed physician and surgeon is not onsite, so long as the
following apply:
(A) The nurse practitioner or nurse-midwife is functioning
pursuant to standardized procedures, as defined by Section 2725, or
protocol. The standardized procedures or protocol shall be developed
and approved by the supervising physician and surgeon, the nurse
practitioner or nurse-midwife, and the facility administrator or his
or her designee.
(B) The physician assistant is functioning pursuant to regulated
services defined in Section 3502 and is approved to do so by the
supervising physician or surgeon.
(b) As used in this section and Sections 2070 and 2071, the
following definitions shall apply:
(1) "Medical assistant" means a person who may be unlicensed, who
performs basic administrative, clerical, and technical supportive
services in compliance with this section and Section 2070 for a
licensed physician and surgeon or a licensed podiatrist, or group
thereof, for a medical, nursing, or podiatry corporation, for a
physician assistant, a nurse practitioner, or a nurse-midwife as
provided in subdivision (a), or for a health care service plan, who
is at least 18 years of age, and who has had at least the minimum
amount of hours of appropriate training pursuant to standards
established by the Division of Licensing. The medical assistant shall
be issued a certificate by the training institution or instructor
indicating satisfactory completion of the required training. A copy
of the certificate shall be retained as a record by each employer of
the medical assistant.
(2) "Specific authorization" means a specific written order
prepared by the licensed physician and surgeon, nurse practitioner,
nurse-midwife, physician assistant, or licensed podiatrist
authorizing the procedures to be performed on a patient, which shall
be placed in the patient's medical record, or a standing order
prepared by the licensed physician and surgeon, nurse practitioner,
nurse-midwife, physician assistant, or licensed podiatrist,
authorizing the procedures to be performed, the duration of which
shall be consistent with accepted medical practice. A notation of the
standing order shall be placed on the patient's medical record.
(3) "Supervision" means the supervision of procedures authorized
by this section by the following practitioners, within the scope of
their respective practices, who shall be physically present in the
treatment facility during the performance of those procedures:
(A) A licensed physician and surgeon.
(B) A licensed podiatrist.
(C) A physician assistant, nurse practitioner, or nurse-midwife.
(4) "Technical supportive services" means simple routine medical
tasks and procedures that may be safely performed by a medical
assistant who has limited training and who functions under the
supervision of a licensed physician and surgeon, a licensed
podiatrist, a physician assistant, a nurse practitioner, or a
nurse-midwife.
(c) Nothing in this section shall be construed as authorizing the
licensure of medical assistants. Nothing in this section shall be
construed as authorizing the administration of local anesthetic
agents by a medical assistant. Nothing in this section shall be
construed as authorizing the division to adopt any regulations that
violate the prohibitions on diagnosis or treatment in Section 2052.
(d) Notwithstanding any other provision of law, a medical
assistant may not be employed for inpatient care in a licensed
general acute care hospital as defined in subdivision (a) of Section
1250 of the Health and Safety Code.
(e) Nothing in this section shall be construed as authorizing a
medical assistant to perform any clinical laboratory test or
examination for which he or she is not authorized by Chapter 3
(commencing with Section 1200). Nothing in this section shall be
construed as authorizing a nurse practitioner, nurse-midwife, or
physician assistant to be a laboratory director of a clinical
laboratory, as those terms are defined in paragraph (7) of
subdivision (a) of Section 1206 and subdivision (a) of Section 1209.
SEC. 5. Section 2838 is added to the Business and Professions
Code, to read:
2838. (a) The Task Force on Nurse Practitioner Scope of Practice
is hereby created and shall consist of the following members:
(1) The Director of Consumer Affairs, who shall serve as an ex
officio member of the task force and shall cast the deciding vote in
any matter voted upon by the task force that results in a tie vote.
(2) Three members of the Medical Board of California, two of whom
shall be appointed to the task force by the Governor, and one of whom
shall be appointed to the task force by the Speaker of the Assembly.
(3) Three members of the Board of Registered Nursing, two of whom
shall be appointed to the task force by the Governor, and one of whom
shall be appointed to the task force by the Senate Committee on
Rules.
(4) Two representatives of an institution of higher education, who
shall be appointed to the task force by the Governor as nonvoting
members.
(b) The duty of the task force shall be to develop a recommended
scope of practice for nurse practitioners.
(c) The task force shall report its recommended scope of practice
for nurse practitioners to the Governor and the Legislature on or
before June 30, 2009.
(d) On or before July 1, 2010, the Director of Consumer Affairs
shall promulgate regulations consistent with existing law
that adopt the task force's recommended scope of practice.
(e) The Medical Board of California and the Board of Registered
Nursing shall pay the state administrative costs of implementing this
section.
(f) This section shall become inoperative on July 1, 2011, and, as
of January 1, 2012, is repealed, unless a later enacted statute,
that is enacted before January 1, 2012, deletes or extends the dates
on which it becomes inoperative and is repealed.
SEC. 7. Section 4040.1 is added to the Business and Professions
Code, to read:
4040.1. (a) Electronic prescribing shall not interfere with a
patient's existing freedom to choose a pharmacy, and shall not
interfere with the prescribing decision at the point of care.
(b) Notwithstanding subdivision (c) of Section 4040, "electronic
prescribing" or "e-prescribing" means a prescription or
prescription-related information transmitted between the point of
care and the pharmacy using electronic media.
SEC. 8. Section 4071.2 is added to the Business and Professions
Code, to read:
4071.2. (a) On or before January 1, 2012, every licensed
prescriber, prescriber's authorized agent, or pharmacy operating in
California shall have the ability to transmit and receive
prescriptions by electronic data transmission.
(b) The Medical Board of California, the State Board of Optometry,
the Bureau of Naturopathic Medicine, the Dental Board of California,
the Osteopathic Medical Board of California, the Board of Registered
Nursing, and the Physician Assistant Committee shall have authority
with the California State Board of Pharmacy to ensure compliance with
this section, and those boards are specifically charged with the
enforcement of this section with respect to their respective
licensees.
(c) Nothing in this section shall be construed to diminish or
modify any requirements or protections provided for in the
prescription of controlled substances as otherwise established by
this chapter or by the California Uniform Controlled Substances Act
(Division 10 (commencing with Section 11000) of the Health and Safety
Code).
SEC. 9. Section 4071.3 is added to the Business and Professions
Code, to read:
4071.3. Every electronic prescription system shall meet all of
the following requirements:
(a) Comply with nationally recognized or certified standards for
data exchange or be accredited by a recognized accreditation
organization.
(b) Allow real-time verification of an individual's eligibility
for benefits and whether the prescribed medication is a covered
benefit.
(c) Comply with applicable state and federal confidentiality and
data security requirements.
(d) Comply with applicable state record retention and reporting
requirements.
SEC. 10. Section 4071.4 is added to the Business and Professions
Code, to read:
4071.4. A prescriber or prescriber's authorized agent using an
electronic prescription system shall offer patients a written receipt
of the information that has been transmitted electronically to the
pharmacy. The receipt shall include the patient's name, the dosage
and drug prescribed, the name of the pharmacy where the electronic
prescription was sent, and shall indicate that the receipt cannot be
used as a duplicate order for the same medicine.
SEC. 11. Section 49452.9 is added to the Education Code, to read:
49452.9. (a) On and after January 1, 2010, the school district
may provide an information sheet regarding health insurance
requirements to the parent or guardian of all of the following:
(1) A pupil enrolled in kindergarten.
(2) A pupil enrolled in first grade if the pupil was not
previously enrolled in kindergarten.
(3) A pupil enrolled during the course of the year in the case of
children who have recently arrived, and intend to remain, in
California.
(b) The information sheet described in subdivision (a) shall
include all of the following:
(1) An explanation of the health insurance requirements under
Section 8899.50 of the Government Code.
(2) Information on the important relationship between health and
learning.
(3) A toll-free telephone number to request an application for
Healthy Families, Medi-Cal, or other government-subsidized health
insurance programs.
(4) Contact information for county public health departments.
(5) A statement of privacy applicable under state and federal laws
and regulations.
(c) By January 1, 2010, the State Department of Education shall,
in consultation with the State Department of Health Care Services and
the Managed Risk Medical Insurance Board, develop a standardized
template for the information sheet required by this section. To the
extent possible, the information provided pursuant to this section
shall be consolidated with the information listed in subdivision (c)
of Section 49452.8 into one document. The State Department of
Education shall make the template available on its Internet Web site
and shall, upon request, provide written copies of the template to a
school district.
SEC. 12. Chapter 15 (commencing with Section 8899.50) is added to
Division 1 of Title 2 of the Government Code, to read:
CHAPTER 15. MINIMUM HEALTH CARE COVERAGE
8899.50. (a) On and after July 1, 2010, every California resident
shall be enrolled in and maintain at least minimum creditable
coverage, as defined by the Managed Risk Medical Insurance Board
pursuant to Section 12739.50 of the Insurance Code, unless otherwise
exempt pursuant to subdivision (d).
(b) On and after July 1, 2010, a subscriber shall obtain and
maintain at least minimum creditable coverage, as defined by the
Managed Risk Medical Insurance Board, for any person who qualifies as
his or her dependent. For purposes of this chapter, the term
"dependent" means the spouse, registered domestic partner, minor
child of the subscriber, or a child 18 years of age and over who is
dependent on the subscriber, as defined by the Managed Risk Medical
Insurance Board.
(c) Notwithstanding subdivisions (a) and (b), compliance with
those subdivisions shall not be required until Sections 12739.50,
12739.51, and 12699.211.01 of the Insurance Code, Section 17052.30 of
the Revenue and Taxation Code, and Sections 14005.301 and 14005.305
of the Welfare and Institutions Code are implemented, and only so
long as these sections remain operative, and the Managed Risk Medical
Insurance Board has defined by regulation the minimum creditable
coverage that will satisfy the requirements of this section.
(d) An individual shall not be subject to the requirements of
subdivisions (a) and (b) if the Managed Risk Medical Insurance Board,
pursuant to Section 12739.501 of the Insurance Code, determines that
health care coverage meeting the definition of minimum creditable
coverage is not affordable for that individual or that the purchase
of minimum creditable coverage would constitute an undue hardship for
that individual, or if the person or family has an income at or
below 250 percent of the federal poverty level and the person's or
family's share of the premium for minimum creditable coverage exceeds
5 percent of his or her family's income.
(e) An individual shall not be subject to the requirements of
subdivisions (a) and (b) if the individual has been in California for
six months or less and is not eligible for guaranteed issue of
health care coverage under Section 1399.829 of the Health and Safety
Code or Section 10928 of the Insurance Code.
(f) "California resident" means an individual who is a resident of
the state pursuant to Section 244 or is physically present in the
state for at least six months, having entered the state with an
employment commitment or to obtain employment, whether or not
employed at the time of application for health care coverage or after
acceptance.
(g) "Subscriber" means an individual with dependents, as
determined by the Managed Risk Medical Insurance Board consistent
with subdivision (b), who is generally eligible to enroll dependents
for health care coverage purposes, including, but not limited to, an
individual whose employment status, or status as head of household,
parent, spouse, or other status, makes the individual eligible to
enroll his or her dependents for health care coverage purposes.
8899.501. For purposes of subdivisions (e) and (f) of Section
8899.50, subdivision (d) of Section 1399.836 of the Health and Safety
Code, and subdivision (g) of Section 10928 of the Insurance Code,
the reference to an individual or person who has been a resident of
California for six months or less and the definition of "California
resident" as an individual who is a resident of the state for at
least six months shall mean a six-month period or any lesser period
required by federal and state law.
SEC. 13. Section 12803.2 is added to the Government Code, to read:
12803.2. The California Health and Human Services Agency, in
consultation with the Board of Administration of the Public Employees'
Retirement System, and after consultation with affected health care
provider groups, shall develop health care provider performance
measurement benchmarks and incorporate these benchmarks into a common
pay-for-performance model to be offered in every state-administered
health care program, including, but not limited to, the Public
Employees' Medical and Hospital Care Act, the Healthy Families
Program, the Major Risk Medical Insurance Program, the Medi-Cal
program, and the California Cooperative Health Insurance Purchasing
Program. These benchmarks shall be developed to advance a common
statewide framework for health care quality measurement and
reporting, including, but not limited to, measures that have been
approved by the National Quality Forum (NQF) such as the Health Plan
Employer Data and Information Set (HEDIS) and the Joint Commission on
Accreditation of Health Care Organizations (JCAHO), and that have
been adopted by the Hospitals Quality Alliance and other national and
statewide groups concerned with quality. The provisions of Section
14167.25 of the Welfare and Institutions Code shall be implemented in
addition to the requirements of this section in such a manner that
they are appropriately integrated with the pay-for-performance model
required under this section.
SEC. 14. Section 12803.25 is added to the Government Code, to
read:
12803.25. (a) The Secretary of California Health and Human
Services, in collaboration with other relevant state agencies, shall
track and assess the effects of health care reform as set forth in
the act enacting this section. The secretary shall either complete
the assessment or contract for its preparation. The secretary may
seek other sources of funding, including grants, to fund the
assessment. The assessment shall include, at minimum, the following
components:
(1) An assessment of the sustainability and solvency of the
program established pursuant to Part 6.45 (commencing with Section
12699.201) of Division 2 of the Insurance Code. This assessment shall
include data regarding persons purchasing health care coverage
through that program.
(2) An assessment of the cost and affordability of health care in
California. This assessment shall include the cost of health care
coverage products for individuals and families obtained through
employers, city and county governments, the Medi-Cal program, the
Healthy Families Program, the Public Employees' Medical and Hospital
Care Act, Medicare Advantage plans, and the individual market.
(3) An assessment of the health care coverage market in
California, including a review of the various insurers and health
care service plans, their offerings, their efficiency in providing
health care services, and their financial conditions, including their
medical loss ratios.
(4) An assessment of the effect on employers and employment,
including employer administrative costs, employee turnover rate, and
wages categorized by the type of employer and the size of the
business. The assessment shall also review if there have been
significant changes to the labor market and increased underground
economy activity.
(5) An assessment of the racial and ethnic disparities in access
and availability of health care, including cultural competency and
language access, and what effects the act adding this section has had
in reducing these disparities.
(6) An assessment of the change in access and availability of
health care coverage throughout the state, including tracking the
availability of health care coverage products in rural and other
underserved areas of the state and assessing the adequacy of the
health care delivery infrastructure to meet the need for health care
services. This assessment shall include a more in-depth review of
areas of the state that were determined to be medically underserved
in 2007.
(7) An assessment of the impact on the county health care safety
net system, including a review of the amount of uncompensated care
and emergency room use.
(8) An overall assessment of health care coverage.
(9) An assessment of the capacity of the various health care
professions and facilities to provide care to Californians.
(b) An advisory body of individuals with knowledge and expertise
in health care policy and financing shall provide input on the
assessment described in subdivision (a). The Governor shall appoint
five members to the advisory body, the Senate Committee on Rules
shall appoint two members, and the Speaker of the Assembly shall
appoint two members.
(c) To the extent possible, the assessment described in
subdivision (a) shall maximize the use of current surveys and
databases.
(d) To the extent feasible, in order to track the effect of health
care reform on ongoing trends in the health care field, the
assessment described in subdivision (a) shall include data from years
prior to the enactment of the program established pursuant to Part
6.45 (commencing with Section 12699.201) of Division 2 of the
Insurance Code.
(e) All state agencies shall cooperate with the secretary in
implementing the provisions of this section.
(f) The Secretary of California Health and Human Services shall
submit the assessment described in subdivision (a) to the appropriate
policy and fiscal committees of the Legislature on or before March
1, 2012. The secretary shall update the assessment biennially.
SEC. 15. Section 22830.5 is added to the Government Code, to read:
22830.5. (a) On or before January 1, 2010, the board shall
provide or arrange for the provision of an electronic personal health
record for enrollees receiving health care benefits. The record
shall be provided for the purpose of providing enrollees with
information to assist them in understanding their coverage benefits
and managing their health care.
(b) At a minimum, the personal health record shall provide access
to real-time, patient-specific information regarding eligibility for
covered benefits and cost sharing requirements. Such access can be
provided through the use of an Internet-based system.
(c) In addition to the data required pursuant to subdivision (b),
the board may determine that the personal health record shall also
incorporate additional data, such as laboratory results, prescription
history, claims history, and personal health information authorized
or provided by the enrollee. Inclusion of this additional data shall
be at the option of the enrollee.
(d) Systems or software that pertain to the personal health record
shall adhere to accepted national standards for interoperability,
privacy, and data exchange, or shall be certified by a nationally
recognized certification body.
(e) The personal health record shall comply with applicable state
and federal confidentiality and data security requirements.
SEC. 16. Section 22830.6 is added to the Government Code, to read:
22830.6. On or before January 1, 2010, the board shall provide or
arrange for the provision of a Healthy Action Incentives and Rewards
Program, as described in subdivision (c) of Section 1367.38 of the
Health and Safety Code, to all enrollees.
SEC. 17. Chapter 1.6 (commencing with Section 155) is added to
Part 1 of Division 1 of the Health and Safety Code, to read:
CHAPTER 1.6. CALIFORNIA HEALTH BENEFITS SERVICE
155. (a) The California Health Benefits Service Program is hereby
created within the State Department of Health Care Services for the
purposes of expanding cost-effective health coverage options to
purchasers governed by the Health Care Security and Cost Reduction
Act. The program shall do all of the following:
(1) Identify statutory, regulatory, or financial barriers or
incentives that should be addressed to facilitate the establishment
and maintenance of one or more joint ventures between health plans
that contract with, or are governed, owned, or operated by, a county
board of supervisors, a county special commission, a county-organized
health system or a county health authority authorized by Section
14018.7, 14087.31, 14087.35, 14087.36, 14087.38, 14087.96 or Article
2.8 (commencing with Section 14087.5) of Chapter 7 of Division 9 of
Part 3 of the Welfare and Institutions Code, as well as the County
Medical Services Program.
(2) Identify statutory, regulatory, or financial barriers or
incentives that should be addressed before joint ventures among these
health plans may be formed, or existing health plans or the County
Medical Services Program may expand to serve other geographic areas,
for the purposes of providing public health care services in counties
where there is not a local initiative or county-organized health
plan that contracts with the State Department of Health Care
Services, or the County Medical Services Program, participating in
these joint ventures.
(3) Report these initial findings to the committees of
jurisdiction in the Senate and Assembly on or before January 15,
2009.
(4) Provide technical assistance to local health care delivery
entities, including local initiatives, county-organized health
systems, and the County Medical Services Program, to support joint
ventures and efforts by these entities to expand to serve other
geographic areas and specified populations, or to contract with
providers to provide health care services in counties where there is
not a local initiative or county-organized health plan that contracts
with the State Department of Health Care Services that opts to
participate in such joint ventures, or participation from the County
Medical Services Program.
(5) Consistent with the report and recommendations provided
pursuant to this section and consistent with existing law, the
department is authorized to enter into contracts with joint ventures
authorized pursuant to this section to provide medical services to
specified populations, as determined by the program.
(b) Health plans that contract with or are governed, owned,
or operated by, a county board of supervisors, a county special
commission, a county-organized health system, or county health
authority authorized by Section 14018.7, 14087.31, 14087.35,
14087.36, 14087.38, or 14087.96 or Article 2.8 (commencing with
Section 14087.5) of Chapter 7 of Division 9 of Part 3 of the Welfare
and Institutions Code, and the County Medical Services Program, are
authorized to form joint ventures to create integrated networks of
public health plans that pool risk and share networks.
(1) In forming joint ventures, participating health plans shall
seek to contract with designated public hospitals, county health
clinics, community health centers, and other traditional safety net
providers.
(2) All joint ventures and health care networks established
pursuant to this section shall seek licensure as a health care
service plan consistent with the Knox-Keene Health Care Service Plan
Act of 1975 (Chapter 2.2 (commencing with Section 1340) of Division 2
of the Health and Safety Code). Prior to commencement of enrollment,
the joint venture or health care network shall be licensed pursuant
to that act.
(c) There is hereby created the California Health Benefits Service
Program Stakeholder Committee. The committee shall be comprised of
10 members appointed by the Director of Health Care Services, the
Senate Committee on Rules, and the Speaker of the Assembly. The
director shall appoint six members including two representatives of
local initiatives authorized under the Welfare and Institutions Code,
a representative of county-organized health systems, a
representative of the County Medical Services Program, a
representative of health care providers, and a representative of
employers. The Senate Committee on Rules shall appoint two members
including a labor representative and a representative of health care
consumers. The Speaker of the Assembly shall appoint two members,
including a representative of local initiatives authorized under the
Welfare and Institutions Code, and a representative of organized
labor. The committee shall meet at least quarterly to provide input
to the program and assist the program in carrying out its
responsibilities as outlined in this section.
(d) On or before November 1, 2009, and annually thereafter, the
department, with input from the committee, shall update the
committees of jurisdiction in the Senate and Assembly on
implementation of this section and make recommendations, as
applicable, on changes necessary to implement this section. The
update shall also include progress on fulfilling the intent of the
Health Care Security and Cost Reduction Act and recommendations on
resources, policy, and legislative changes necessary to build and
implement a system of public health coverage throughout California.
The update shall describe the projects proposed or established
pursuant to this section, including, but not limited to, the
participating providers, the groups covered, the physicians and
hospitals in the network, and the counties served.
(e) The program shall consult with relevant departments, including
the Department of Managed Health Care, in the implementation of this
section.
(f) Nothing in this section shall be construed to prohibit any
other licensed health care service plan not mentioned in subdivisions
(b) and (c) from entering in joint ventures or contracts with the
State Department of Health Care Services to provide services in
counties in which there is not a Medi-Cal managed care health plan
that contracts with the department.
SEC. 18. Section 1262.9 is added to the Health and Safety Code, to
read:
1262.9. (a) If a patient has coverage for emergency health care
services and poststabilizing care, a noncontracting hospital shall
not bill the patient for emergency health care services and
poststabilizing care, except for applicable copayments and cost
shares.
(b) The noncontracting hospital and the health care service plan
or health insurer shall each retain their right to pursue all
currently available legal remedies they may have against each other,
including the right to determine the final payment due.
(c) For the purposes of this section:
(1) "Noncontracting hospital" means a general acute care hospital
as defined in subdivision (a) of Section 1250 that has a special
permit to operate an emergency medical service and does not have a
contract with a health care service plan or a health insurer for the
provision of emergency health care services and poststabilizing care
to the patient, who is one of that health care service plan's or
health insurer's enrollees, members, or insureds.
(2) "Emergency health care services and poststabilizing care"
means emergency services and out-of-area urgent services provided in
an emergency department and a hospital through discharge in
compliance with Sections 1262.8 and 1317 and, in the case of health
care service plans, the services required to be covered pursuant to
paragraph (6) of subdivision (b) of Section 1345, subdivision (i) of
Section 1367, Sections 1371.4, and 1371.5, of this code, and Sections
1300.67(g) and 1300.71.4 of Title 28 of the California Code of
Regulations.
SEC. 19. Section 1342.9 is added to the Health and Safety Code, to
read:
1342.9. (a) Notwithstanding any other provision of this chapter,
a health care service plan that provides services to a beneficiary of
the Medi-Cal program pursuant to Article 2.7 (commencing with
Section 14087.3), Article 2.8 (commencing with Section 14087.5), or
Article 2.91 (commencing with Section 14089) of Chapter 7 of, or
Article 1 (commencing with Section 14200) or Article 7 (commencing
with Section 14490) of Chapter 8 of, Part 3 of Division 9 of the
Welfare and Institutions Code shall, regarding coverage for
participants in a Medi-Cal managed care program, be subject solely to
the filing, reporting, monitoring, and survey requirements
established by the State Department of Health Care Services for the
Medi-Cal managed care program as those requirements pertain to the
following subjects: advertising and marketing; member materials,
including member handbooks, evidences of coverage, and disclosure
forms; and product design, including its scope and limitations. A
health care service plan that satisfies any of the foregoing filing,
reporting, monitoring, or survey requirements shall be deemed in
compliance with corresponding provisions, if any, of this chapter.
(b) The department and the State Department of Health Care
Services shall develop a joint filing and review process for medical
quality surveys required pursuant to Section 1380 and pursuant to
Chapter 8 (commencing with Section 14200) of Part 3 of Division 9 of
the Welfare and Institutions Code.
SEC. 20. Section 1347 is added to the Health and Safety Code, to
read:
1347. The director is authorized to provide regulatory and
program flexibilities to facilitate new, modified, or combined
licenses of local initiatives and county-organized health systems,
created pursuant to Section 155 or the California Health Benefits
Service Program (Chapter 1.6 (commencing with Section 155) of Part 1
of Division 1), that seek licensure for regional or statewide
networks for the purposes of contracting with the Managed Risk
Medical Insurance Board as a participating plan in the California
Cooperative Health Insurance Purchasing Program, or for the purposes
of providing coverage in the individual and group coverage markets.
In providing those flexibilities, the director shall ensure that the
health plans established pursuant to this section meet essential
financial, capacity, and consumer protection requirements of this
chapter.
SEC. 20.5. Section 1356.2 is added to the Health and Safety Code,
to read:
1356.2. (a) It is the intent of the Legislature to establish
mechanisms by which the state may defray the costs of an enrollee's
public program participation. The state's efforts may include, but
shall not be limited to, creating mechanisms to take advantage of
other opportunities for coverage available to that enrollee, to
access nonstate resources available to fund care for that enrollee,
or other mechanisms to minimize state costs.
(b) (1) The State Department of Health Care Services, in
consultation with the Department of Insurance and the Department of
Managed Health Care, shall evaluate and consider the options to
effectuate the intent of this section and determine the process and
procedures to implement subdivision (a). The departments shall assess
the fiscal ramifications and administrative feasibility of potential
options, and determine the requirements that best effectuate and
implement this section. The department shall report its findings to
the Joint Legislative Budget Committee by July 1, 2009.
(2) Ninety days following the department's notification to the
Joint Legislative Budget Committee pursuant to paragraph (1), the
departments shall implement the policies, procedures, and
requirements described in its report.
(c) To the extent necessary to achieve the purposes of subdivision
(a), the State Department of Health Care Services may implement
Section 1396e of Title 42 of the United States Code. To the extent
necessary to achieve the purposes of this section, this option shall
be exercised in conjunction with the benchmark authority provided in
Section 1396u-7 of Title 42 of the United States Code.
(d) To the extent necessary to achieve the purposes of subdivision
(a), the Department of Insurance and the Department of Managed
Health Care shall establish appropriate licensing requirements for
health insurers and health care service plans to permit the state to
access funds and contributions available to enrollees to reduce the
cost of subsidized coverage.
(e) For the purposes of implementing this section, the State
Department of Health Care Services, the Department of Insurance, and
the Department of Managed Health Care shall promulgate regulations in
accordance with the requirements of Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
(f) For the purposes of this section, "subsidized coverage" means
coverage provided under either of the following:
(1) Part 6.45 (commencing with Section 12699.201) of Division 2 of
the Insurance Code through a Cal-CHIPP Healthy Families plan.
(2) Section 14005.333 of the Welfare and Institutions Code.
(g) This section shall be implemented no later than one year from
the date that the act enacting this section becomes operative.
SEC. 21. Section 1357.54 of the Health and Safety Code is amended
to read:
1357.54. All individual health benefit plans, except for
short-term limited duration insurance, shall be renewable with
respect to all eligible individuals or dependents at the option of
the individual except as follows:
(a) For nonpayment of the required premiums or contributions by
the individual in accordance with the terms of the health insurance
coverage or the timeliness of the payments.
(b) For fraud or intentional misrepresentation of material fact
under the terms of the coverage by the individual.
(c) Movement of the individual contractholder outside the service
area, but only if the coverage is terminated uniformly without regard
to any health status-related factor of covered individuals.
(d) If the plan ceases to provide or arrange for the provision of
health care services for new individual health benefit plans in this
state; provided, however, that the following conditions are
satisfied:
(1) Notice of the decision to cease new or existing individual
health benefit plans in the state is provided to the director and to
the individual at least 180 days prior to discontinuation of that
coverage.
(2) Individual health benefit plans shall not be canceled for 180
days after the date of the notice required under paragraph (1) and
for that business of a plan that remains in force, any plan that
ceases to offer for sale new individual health benefit plans shall
continue to be governed by this section with respect to business
conducted under this section.
(3) A plan that ceases to write new individual health benefit
plans in this state after the effective date of this section shall be
prohibited from offering for sale individual health benefit plans in
this state for a period of five years from the date of notice to the
director.
(e) If the plan withdraws an individual health benefit plan from
the market; provided, that the plan notifies all affected individuals
and the director at least 90 days prior to the discontinuation of
these plans, and that the plan makes available to the individual all
health benefit plans that it makes available to new individual
business without regard to any health status-related factor of
enrolled individuals or individuals who may become eligible for the
coverage.
This section shall become inoperative on the date that Section
1399.829 becomes operative.
SEC. 22. Section 1365 of the Health and Safety Code is amended to
read:
1365. (a) An enrollment or a subscription may not be canceled or
not renewed except for the following:
(1) Failure to pay the charge for such coverage if the subscriber
has been duly notified and billed for the charge and at least 15 days
has elapsed since the date of notification.
(2) Fraud or deception in the use of the services or facilities of
the plan or knowingly permitting such fraud or deception by another.
(3) Such other good cause as is agreed upon in the contract
between the plan and a group or the subscriber.
(b) An enrollee or subscriber who alleges that an enrollment or
subscription has been canceled or not renewed because of the enrollee'
s or subscriber's health status or requirements for health care
services may request a review by the director. If the director
determines that a proper complaint exists under the provisions of
this section, the director shall notify the plan. Within 15 days
after receipt of such notice, the plan shall either request a hearing
or reinstate the enrollee or subscriber. If, after hearing, the
director determines that the cancellation or failure to renew is
contrary to subdivision (a), the director shall order the plan to
reinstate the enrollee or subscriber. A reinstatement pursuant to
this subdivision shall be retroactive to the time of cancellation or
failure to renew and the plan shall be liable for the expenses
incurred by the subscriber or enrollee for covered health care
services from the date of cancellation or nonrenewal to and including
the date of reinstatement.
(c) This section shall not abrogate any preexisting contracts
entered into prior to the effective date of this chapter between a
subscriber or enrollee and a health care service plan or a
specialized health care service plan including, but not limited to,
the financial liability of that plan, except that each plan shall, if
directed to do so by the director, exercise its authority, if any,
under any such preexisting contracts to conform them to the
provisions of subdivision (a).
(d) On and after the date that Section 1399.829 becomes operative,
this section shall not apply to individual health plan contracts.
SEC. 22.7. Section 1367.16 is added to the Health and Safety Code,
to read:
1367.16. For purposes of subdivision (c) of Section 1367.15,
"comparable benefits" means any health plan contract in the same
coverage choice category, as determined by the department and the
Department of Insurance pursuant to Section 1399.832, that a closed
block of business would have been in, had that block of business not
been closed. If the coverage benefits provided in the closed block of
business do not meet or exceed the minimum health care coverage
requirements of Section 1399.824, they shall be deemed comparable to
the lowest coverage choice category.
SEC. 23. Section 1367.205 is added to the Health and Safety Code,
to read:
1367.205. Commencing on or before January 1, 2010, a health care
service plan that provides prescription drug benefits and maintains
one or more drug formularies shall make the most current formularies
available electronically to prescribers and pharmacies.
SEC. 24. Section 1367.38 is added to the Health and Safety Code,
to read:
1367.38. (a) On and after January 1, 2009, every health care
service plan, except for a Medicare supplement plan, that covers
hospital, medical, or surgical expenses on a group basis shall offer
to include a Healthy Action Incentives and Rewards Program, as
described in subdivision (b), to be implemented in connection with a
health care service plan, under such terms and conditions as may be
agreed upon between the subscriber group and the health care service
plan. Every plan shall communicate the availability of that program
to all prospective subscriber groups with whom it is negotiating and
to existing subscriber groups upon renewal.
(b) For purposes of this section, benefits under a Healthy Action
Incentives and Rewards Program shall provide for all of the
following, where appropriate:
(1) Health risk appraisals to be used to assess an individual's
overall health status and to identify risk factors, including, but
not limited to, smoking and smokeless tobacco use, alcohol abuse,
drug use, and nutrition and physical activity practices.
(2) Enrollee access to an appropriate health care provider, as
medically necessary, to review and address the results of the health
risk appraisal. In addition, where appropriate, the Healthy Action
Incentives and Rewards Program may include followup through a
Web-based tool or a nurse hotline either in combination with a
referral to a provider or separately.
(3) Incentives or rewards for enrollees to become more engaged in
their health care and to make appropriate choices that support good
health, including obtaining health risk appraisals, screening
services, immunizations, or participating in healthy lifestyle
programs and practices. These programs and practices may include, but
need not be limited to, smoking cessation, physical activity, or
nutrition. Incentives may include, but need not be limited to, health
premium reductions, differential copayment or coinsurance amounts,
and cash payments. Rewards may include, but need not be limited to,
nonprescription pharmacy products or services not otherwise covered
under an enrollee's health plan contract, exercise classes, gym
memberships, and weight management programs. If a health care service
plan elects to offer an incentive in the form of a reduction in the
premium amount, the premium reduction shall be standardized and
uniform for all groups and subscribers and shall be offered only
after the successful completion of the specified program or practice
by the enrollee or subscriber.
(c) (1) A health care service plan subject to this section shall
offer and price all Healthy Action Incentives and Rewards Programs
approved by the director consistently across all groups, potential
groups, and individuals and offer and price the programs without
regard to the health status, prior claims experience, or risk profile
of the members of a group. A health plan shall not condition the
offer, delivery, or renewal of a contract that covers hospital,
medical, or surgical expenses on the group's purchase, acceptance, or
enrollment in a Healthy Action Incentives and Rewards Program.
Rewards and incentives established in the program may not be
designed, provided, or withheld based on the actual health service
utilization or health care claims experience of the group, members of
the group, or the individual.
(2) In order to demonstrate compliance with this section, a health
care service plan shall file the program description and design as
an amendment to its application for licensure pursuant to subdivision
(a) of Section 1352. The director shall disapprove, suspend, or
withdraw any product or program developed pursuant to this section if
the director determines that the product or product design has the
effect of allowing health care service plans to market, sell, or
price health coverage for healthier lower risk profile groups in a
preferential manner that is inconsistent with the requirement to
offer, market, and sell products pursuant to Article 3.1 (commencing
with Section 1357) and Article 11.6 (commencing with Section
1399.820).
(d) This section shall supplement, and not supplant, any other
section in this chapter concerning requirements for plans to provide
health care services, childhood immunizations, adult immunizations,
and preventive care services.
(e) This section shall only be implemented if and to the extent
allowed under federal law. If any portion of this section is held to
be invalid, as determined by a final judgment of a court of competent
jurisdiction, this section shall become inoperative.
SEC. 25. Section 1368.025 is added to the Health and Safety Code,
to read:
1368.025. In addition to the duties listed in paragraph (3) of
subdivision (c) of Section 1368.02, the duties of the Office of
Patient Advocate shall include providing access to the public to
reports and data obtained by the Office of Statewide Health Planning
and Development in a format and through mechanisms, including, but
not limited to, the Internet, that allow the public to use the
information to assist them in making informed selections of health
plans, hospitals, medical groups, nursing homes, and other providers
about whom the office has collected information.
SEC. 26. Section 1378.1 is added to the Health and Safety Code, to
read:
1378.1. (a) Except as provided in subdivision (f), a full-service
health care service plan shall, on and after July 1, 2010, expend in
the form of health care benefits no less than 85 percent of the
aggregate dues, fees, premiums, or other periodic payments received
by the plan. For purposes of this section, the plan may deduct from
the aggregate dues, fees, premiums, or other periodic payments
received by the plan the amount of income taxes or other taxes that
the plan expensed. For purposes of this section, "health care
benefits" shall mean health care services that are either provided by
or reimbursed by the plan or its contracted providers as plan
benefits.
(b) (1) In addition to the health care benefits defined in
subdivision (a), health care benefits shall include:
(A) The costs of programs or activities, including training and
the provision of informational materials that are determined as part
of the regulations under subdivision (d) to improve the provision of
quality care, improve health care outcomes, or encourage the use of
evidence-based medicine.
(B) Disease management expenses using cost-effective
evidence-based guidelines.
(C) Plan medical advice by telephone.
(D) Payments to providers as risk pool payments of
pay-for-performance initiatives.
(2) Health care benefits shall not include administrative costs
listed in Section 1300.78 of Title 28 of the California Code of
Regulations in effect on January 1, 2007.
(c) To assess compliance with this section, a plan licensed to
operate in California may average its total costs across all health
care service plan contracts issued, amended, or renewed in
California, and all health insurance policies issued, amended, or
renewed by its affiliated disability insurers with valid California
certificates of authority, except for those policies listed in
subdivision (f) of Section 10113.10 of the Insurance Code.
(d) The department and the Department of Insurance shall jointly
adopt and amend regulations to implement this section and Section
10113.10 of the Insurance Code to establish uniform reporting by
plans and insurers of the information necessary to determine
compliance with this section. These regulations may include
additional elements in the definition of health care benefits not
identified in paragraph (1) of subdivision (b) in order to
consistently operationalize the requirements of this section among
health plans and health insurers, but such regulatory additions shall
be consistent with the legislative intent that health plans expend
at least 85 percent of aggregate payments as provided in subdivision
(a) on health care benefits.
(e) The department may exclude from the determination of
compliance with the requirement of subdivision (a) any new health
care service plan contracts for up to the first two years that these
contracts are offered for sale in California, provided that the
director determines that the new contracts are substantially
different from the existing contracts being issued, amended, or
renewed by the health plan seeking the exclusion.
(f) This section shall not apply to Medicare supplement plans or
to coverage offered by specialized health care service plans,
including, but not limited to, ambulance, dental, vision, behavioral
health, chiropractic, and naturopathic.
SEC. 27. Section 1395.2 is added to the Health and Safety Code, to
read:
1395.2. (a) A health care service plan may provide notice by
electronic transmission and shall be deemed to have fully complied
with the specific statutory or regulatory requirements to provide
notice by United States mail to an applicant, enrollee, or
subscriber, if it complies with all of the following requirements:
(1) Obtains authorization from the applicant, enrollee, or
subscriber to provide notices by electronic transmission and to cease
providing notices by United States mail. "Authorization" means the
agreement by the applicant, enrollee, or subscriber through
interactive voice response, the Internet or other similar medium, or
in writing, to receive notices by electronic transmission.
(2) Uses an authorization process, approved by the department, in
which the applicant, enrollee, or subscriber confirms understanding
of and agreement with the specific notices or materials that will be
provided by electronic transmission.
(3) Complies with the specific statutory or regulatory
requirements as to the content of the notices it sends by electronic
transmission.
(4) Provides for the privacy of the notice as required by state
and federal laws and regulations.
(5) Allows the applicant, enrollee, or subscriber at any time to
terminate the authorization to provide notices by electronic
transmission and receive the notices through the United States mail,
if specific statutory or regulatory requirements require notice by
mail.
(6) Sends the electronic transmission of a notice to the last
known electronic address of the applicant, enrollee, or subscriber.
If the electronic transmission fails to reach its intended recipient
twice, the health care service plan shall resume sending all notices
to the last known
United States mail address of the applicant, enrollee, or subscriber.
(7) Maintains an Internet Web site where the applicant, enrollee,
or subscriber may access the notices sent by electronic transmission.
(8) Informs the applicant, enrollee, or subscriber how to
terminate the authorization to provide notices sent by electronic
transmission.
(b) A health care service plan shall not use the electronic mail
address of an applicant, enrollee, or subscriber that it obtained for
the purposes of providing notice pursuant to subdivision (a) for any
purpose other than communicating with the enrollee, applicant, or
subscriber about his or her policy, plan, or benefits.
(c) No person other than the applicant, enrollee, or subscriber to
whom the medical information in the notice pertains or a
representative lawfully authorized to act on behalf of the applicant,
enrollee, or subscriber, may authorize the transmission of medical
information by electronic transmission. "Medical information" for
these purposes shall have the meaning set forth in subdivision (g) of
Section 56.05 of the Civil Code. The transmission of any medical
information, as that term is used in subdivision (g) of Section 56.05
of the Civil Code, shall comply with the Confidentiality of Medical
Information Act (Part 2.6 (commencing with Section 56) of Division 1
of the Civil Code).
(d) A notice transmitted electronically pursuant to this section
is a private and confidential communication, and it shall constitute
a violation of this chapter for a person, other than the applicant,
enrollee, or subscriber to whom the notice is addressed, to read or
otherwise gain access to the notice without the express, specific
permission of the notice's addressee. This subdivision shall not
apply to a health care provider, health care service plan, or
contractor of a health care provider or health care service plan, of
an applicant, enrollee, or subscriber if the health care provider,
health care service plan, or contractor of a health care provider or
health care service plan is authorized to have access to the medical
information pursuant to the Confidentiality of Medical Information
Act (Part 2.6 (commencing with Section 56) of Division 1 of the Civil
Code).
(e) A health care service plan shall not impose additional fees or
a differential if an applicant, enrollee, or subscriber elects not
to receive notices by electronic transmission.
(f) Notices that may be made by electronic transmission include an
explanation of benefits; responses to inquiries from an applicant,
enrollee, or subscriber; underwriting decisions; distribution of plan
contracts, including evidence of coverage and disclosure forms
pursuant to Sections 1300.63.1 and 1300.63.2 of Title 28 of the
California Code of Regulations; a list of contracting providers
pursuant to Section 1367.26; and changes in rates or coverage
pursuant to Sections 1374.21, 1374.22, and 1374.23. A plan may not
transmit through electronic means any notice that may affect the
eligibility for, or continued enrollment in, coverage.
SEC. 27.3. Section 1399.56 of the Health and Safety Code is
amended to read:
1399.56. (a) Compensation of a person retained by a health care
service plan to review claims for health care services shall not be
based on either of the following:
(1) A percentage of the amount by which a claim is reduced for
payment.
(2) The number of claims or the cost of services for which the
person has denied authorization or payment.
(b) This section shall become inoperative on December 1, 2008,
and, as of January 1, 2009, is repealed, unless a later enacted
statute, that becomes operative on or before January 1, 2009, deletes
or extends the dates on which it becomes inoperative and is
repealed.
SEC. 27.5. Section 1399.56 is added to the Health and Safety Code,
to read:
1399.56. (a) Compensation of a person employed by or contracted
with a health care service plan to review claims or eligibility for
health care services shall not be based on either of the following:
(1) A percentage of the amount by which a claim is reduced for
payment.
(2) The number of claims or the cost of services for which the
person has denied authorization or payment.
(b) This section shall become operative on December 1, 2008.
SEC. 28. Section 1399.58 is added to the Health and Safety Code,
to read:
1399.58. (a) No health care service plan shall set performance
goals or quotas or provide additional compensation to any person
employed by or contracted with the health care service plan based on
the number of persons for which coverage is rescinded or the
financial savings to the health care service plan associated with the
rescission of coverage.
(b) This section shall become operative on December 1, 2008.
SEC. 28.5. Article 11.6 (commencing with Section 1399.820) is
added to Chapter 2.2 of Division 2 of the Health and Safety Code, to
read:
Article 11.6. Individual Market Reform and Guarantee Issue
1399.820. It is the intent of the Legislature to do both of the
following:
(a) Guarantee the availability and renewability of health coverage
to individuals through the private health insurance market.
(b) Require that health care service plans and health insurers
issuing coverage in the individual market compete on the basis of
price, quality, and service, and not on risk selection.
1399.821. For purposes of this article, the following terms shall
have the following meanings:
(a) "Anniversary date" means the calendar date one year from, and
each subsequent year thereafter, the date an individual enrolls in a
health plan contract.
(b) "Coverage choice category" means the category of health plan
contracts and health insurance policies established by the department
and the Department of Insurance pursuant to Section 1399.832.
(c) "Dependent" means the spouse, registered domestic partner, or
child of an individual, subject to applicable terms of the health
plan contract covering the individual.
(d) "Health insurance policy" means an individual disability
insurance policy offered, sold, amended, or renewed to individuals
and their dependents and that provides coverage for hospital,
medical, or surgical benefits. The term shall not include any of the
following kinds of insurance:
(1) Accidental death and accidental death and dismemberment.
(2) Disability insurance, including hospital indemnity,
accident-only, and specified disease insurance that pays benefits on
a fixed benefit, cash-payment-only basis.
(3) Credit disability, as defined in Section 779.2 of the
Insurance Code.
(4) Coverage issued as a supplement to liability insurance.
(5) Disability income, as defined in subdivision (i) of Section
799.01 of the Insurance Code.
(6) Insurance under which benefits are payable with or without
regard to fault and that is statutorily required to be contained in
any liability insurance policy or equivalent self-insurance.
(7) Insurance arising out of a workers' compensation or similar
law.
(8) Long-term care coverage.
(9) Dental coverage.
(10) Vision coverage.
(11) Medicare supplement, CHAMPUS-supplement or
Tricare-supplement, behavioral health-only, pharmacy-only, hospital
indemnity, hospital-only, accident-only, or specified disease
insurance that does not pay benefits on a fixed benefit,
cash-payment-only basis.
(e) "Health insurer" means a disability insurer that offers and
sells health insurance.
(f) "Health plan" means a health care service plan, as defined in
subdivision (f) of Section 1345, that is lawfully engaged in
providing, arranging, paying for, or reimbursing the cost of health
care services and is offering or selling health care service plan
contracts in the individual market. A health plan shall not include a
specialized health care service plan.
(g) "Health plan contract" means an individual health care service
plan contract offered, sold, amended, or renewed to individuals and
their dependents. The term shall not include long-term care
insurance, dental, or vision coverage. In addition, the term shall
not include a specialized health care service plan contract, as
defined in subdivision (o) of Section 1345.
(h) "Purchasing pool" means the program established under Part
6.45 (commencing with Section 12699.201) of Division 2 of the
Insurance Code.
(i) "Rating period" means the period for which premium rates
established by a plan are in effect and shall be no less than 12
months beginning on the effective date of the subscriber's health
plan contract.
(j) "Risk adjustment factor" means the percentage adjustment to be
applied to the standard risk rate for a particular individual, based
upon any expected deviations from standard claims due to the health
status of the individual.
(k) "Risk category" means the following characteristics of an
individual: age, geographic region, and family composition of the
individual, plus the health plan contract selected by the individual.
(1) No more than the following age categories may be used in
determining premium rates:
Under 1.
1-18.
19-24.
25-29.
30-34.
35-39.
40-44.
45-49.
50-54.
55-59.
60-64.
65 and over.
However, for the 65 and over age category, separate premium rates
may be specified depending upon whether coverage under the health
plan contract will be primary or secondary to benefits provided by
the federal Medicare Program pursuant to Title XVIII of the federal
Social Security Act.
(2) Health plans shall determine rates using no more than the
following family size categories:
(A) Single.
(B) More than one child 18 years of age or under and no adults.
(C) Married couple or registered domestic partners.
(D) One adult and child.
(E) One adult and children.
(F) Married couple and child or children, or registered domestic
partners and child or children.
(3) (A) In determining rates for individuals, a health plan that
operates statewide shall use no more than nine geographic regions in
the state, have no region smaller than an area in which the first
three digits of all its ZIP Codes are in common within a county, and
divide no county into more than two regions. Health plans shall be
deemed to be operating statewide if their coverage area includes 90
percent or more of the state's population. Geographic regions
established pursuant to this section shall, as a group, cover the
entire state, and the area encompassed in a geographic region shall
be separate and distinct from areas encompassed in other geographic
regions. Geographic regions may be noncontiguous.
(B) (i) In determining rates for individuals, a plan that does not
operate statewide shall use no more than the number of geographic
regions in the state that is determined by the following formula: the
population, as determined in the last federal census, of all
counties that are included in their entirety in a plan's service area
divided by the total population of the state, as determined in the
last federal census, multiplied by nine. The resulting number shall
be rounded to the nearest whole integer. No region may be smaller
than an area in which the first three digits of all its ZIP Codes are
in common within a county and no county may be divided into more
than two regions. The area encompassed in a geographic region shall
be separate and distinct from areas encompassed in other geographic
regions. Geographic regions may be noncontiguous. No health plan
shall have less than one geographic area.
(ii) If the formula in clause (i) results in a health plan that
operates in more than one county having only one geographic region,
then the formula in clause (i) shall not apply and the health plan
may have two geographic regions, provided that no county is divided
into more than one region.
Nothing in this section shall be construed to require a health
plan to establish a new service area or to offer health coverage on a
statewide basis, outside of the health plan's existing service area.
(4) A health plan may rate its entire portfolio of health plan
contracts in accordance with expected costs or other market
considerations, but the rate for each health plan contract shall be
set in relation to the balance of the portfolio, as certified by an
actuary.
(5) Each health plan contract shall be priced as determined by
each health plan to reflect the difference in benefit variation, or
the effectiveness of a provider network, and each health plan may
adjust the rate for a specific plan contract for risk selection only
to the extent permitted by subdivision (d) of Section 1399.840.
(l) "Standard risk rate" means the rate applicable to an
individual in a particular risk category.
(m) "Subscriber" means the individual who is enrolled in a health
plan contract, is the basis for eligibility for enrollment in the
contract, and is responsible for payment to the health plan.
1399.823. On and after March 31, 2009, a health plan shall not
offer to an individual a health plan contract that provides less than
minimum creditable coverage as defined by the Managed Risk Medical
Insurance Board pursuant to Section 12739.50 of the Insurance Code.
1399.826. (a) Notwithstanding Chapter 15 (commencing with Section
8899.50) of Division 1 of Title 2 of the Government Code and Section
1399.823, a health plan may renew an individual health care benefit
plan for anyone enrolled on March 1, 2009, indefinitely without
increasing benefits to meet the required minimum creditable coverage
established by the Managed Risk Medical Insurance Board pursuant to
Section 12739.50 of the Insurance Code. Those individual health care
benefit plans, however, may not be offered to new enrollment, unless
they are amended to meet the minimum creditable coverage established
by the Managed Risk Medical Insurance Board pursuant to Section
12739.50 of the Insurance Code. In offering those plans for renewal,
rates determined by health plans shall meet the requirements of
Sections 1399.821 and 1399.840. An individual who maintains coverage
in a health plan contract pursuant to this section shall be deemed to
be in compliance with Section 8899.50 of the Government Code.
(b) A health plan shall not cease to renew coverage in an
individual health plan contract described in subdivision (a) except
as permitted pursuant to Section 1367.15.
(c) On and after March 1, 2009, the director shall not approve for
offer and sale in this state any new individual health plan contract
that does not meet or exceed the requirements for minimum creditable
coverage established by the Managed Risk Medical Insurance Board
pursuant to Section 12739.50 of the Insurance Code.
(d) Effective July 1, 2010, all individual health plan contracts
approved, offered, and sold prior to March 1, 2009, which do not
comply with minimum creditable coverage standards adopted by the
Managed Risk Medical Insurance Board pursuant to Section 12739.50 of
the Insurance Code, exclusively because the contract includes a
lifetime benefit maximum inconsistent with minimum creditable
coverage requirements, shall be modified to comply with the minimum
creditable coverage standard.
(e) This section shall become operative on January 1, 2009.
1399.827. A health plan shall, in addition to complying with this
chapter and the rules of the director, comply with this article.
1399.828. This article shall not apply to health plan contracts
for coverage of Medicare services pursuant to contracts with the
United States government, Medicare supplement, Medi-Cal contracts
with the State Department of Health Care Services, Healthy Families
Program contracts with the Managed Risk Medical Insurance Board,
long-term care coverage, specialized health care service plan
contracts, as defined in subdivision (o) of Section 1345, or the
purchasing pool established under Part 6.45 (commencing with Section
12699.201) of Division 2 of the Insurance Code.
1399.829. (a) Except for the health plan contracts described in
subdivision (a) of Section 1399.826, a health plan shall fairly and
affirmatively offer, market, and sell all of the plan's contracts
that are sold to individuals to all individuals in each service area
in which the health plan provides or arranges for the provision of
health care services.
(b) A health plan may not reject an application from an
individual, or his or her dependents, for a health plan contract, or
refuse to renew an individual health plan contract, if all of the
following requirements are met:
(1) The individual agrees to make the required premium payments.
(2) The individual and his or her dependents who are to be covered
by the health plan contract work or reside in the service area in
which the health plan provides or otherwise arranges for the
provision of health care services.
(3) The individual provides the information requested on the
application to determine the appropriate rate.
(c) Notwithstanding subdivision (b), if an individual, or his or
her dependents, applies for a health plan contract in a coverage
choice category for which he or she is not eligible pursuant to
Section 1399.837, the health plan may reject that application
provided that the plan also offers the individual and his or her
dependents coverage in the appropriate coverage choice category.
(d) Notwithstanding subdivision (b), a health plan is not required
to renew an individual health plan contract if any of the conditions
listed in subdivision (a) of Section 1399.839 are met.
(e) Notwithstanding any other provision of this chapter or of a
health plan contract, every health plan shall comply with the
requirements of Chapter 7 (commencing with Section 3750) of Part 1 of
Division 9 of the Family Code and Section 14124.94 of the Welfare
and Institutions Code.
(f) A health plan may require an individual to provide information
on his or her health status or health history, or that of his or her
dependents, in the application for enrollment to the extent required
to apply the risk adjustment factor permitted pursuant to
subdivision (d) of Section 1399.840. The health plan shall use the
standardized form and process developed by the department pursuant to
Section 1399.840. After the health plan contract's effective date of
coverage, a health plan may request that the subscriber provide
information voluntarily on his or her health history or health
status, or that of his or her dependents, for purposes of providing
care management services, including disease management services.
(g) Notwithstanding subdivision (b), a health plan may reject an
application for any person who has been a resident of California for
six months or less unless one of the following applies: (1) the
person is a federally eligible defined individual as defined in
Section 1399.801 or Section 10785 of the Insurance Code; or (2) the
individual can demonstrate a minimum of two years of prior creditable
coverage at least equivalent to the minimum creditable coverage
developed by the Managed Risk Medical Insurance Board pursuant to
Section 12739.50 of the Insurance Code and provided the person
applies for coverage in California within 62 days of termination or
cancellation of the prior creditable coverage.
(h) Notwithstanding subdivision (b), a health plan may reject an
application for coverage from either of the following:
(1) A person who is exempt from the requirements of Section
8899.50 of the Government Code because the person or family has an
income at or below 250 percent of the federal poverty level and the
person's or family's share of premium for minimum creditable coverage
exceeds 5 percent of his or her family income, except for those
individuals meeting the criteria in paragraph (1) or (2) of
subdivision (g).
(2) A person exempted from the requirements of Section 8899.50 of
the Government Code pursuant to any exemption authorized or granted
by the Managed Risk Medical Insurance Board pursuant to Section
12739.501 of the Insurance Code, for the time period of the
exemption, as determined by the board.
(i) Notwithstanding Section 1399.846, this section shall not
become operative until Section 12739.51 of the Insurance Code is
implemented.
1399.831. (a) A health plan shall not impose any preexisting
condition exclusions, waivered conditions, or postenrollment waiting
or affiliation periods on any health plan contract issued, amended,
or renewed pursuant to this article, except as provided under
subdivision (b) of this section.
(b) After the requirement to guarantee issue of coverage under
Section 1399.826 has been in effect for nine months, a health plan
may impose a preexisting condition exclusion of up to 12 months for
any person who fails to comply for more than 62 days with the
requirement to maintain coverage under Section 8899.50 of the
Government Code, providing, however, that the exclusion may not
exceed the length of time that the person failed to comply with the
requirements of that section. "Preexisting condition exclusion" means
a contract provision that excludes coverage for charges or expenses
incurred during a specified period following the individual's
effective date of coverage, as to a condition for which medical
advice, diagnosis, care, or treatment was recommended or received
during a specified period immediately preceding the effective date of
coverage. For purposes of this section, preexisting condition
provisions contained in plan contracts may relate only to conditions
for which medical advice, diagnosis, care, or treatment, including
use of prescription drugs, was recommended or received from a
licensed health practitioner during the 12 months immediately
preceding the effective date of coverage.
1399.832. (a) On or before April 1, 2009, the department and the
Department of Insurance shall jointly, by regulation, develop a
system to categorize all health plan contracts and health insurance
polices offered and sold to individuals pursuant to this article and
Chapter 9.6 (commencing with Section 10920) of Part 2 of Division 2
of the Insurance Code into five coverage choice categories. These
coverage choice categories shall do all of the following:
(1) Reflect a reasonable continuum between the coverage choice
category with the lowest level of health care benefits and the
coverage choice category with the highest level of health care
benefits.
(2) Permit reasonable benefit variation that will allow for a
diverse market within each coverage choice category.
(3) Be enforced consistently between health plans and health
insurers in the same marketplace regardless of licensure.
(4) Within each coverage choice category, include one standard
health maintenance organization (HMO) and one standard preferred
provider organization (PPO), each of which is the health plan
contract with the lowest benefit level in that category and for that
type of contract.
(b) All health plans shall submit filings required pursuant to
Section 1399.842 no later than October 1, 2009, for all individual
health plan contracts to be offered or sold on or after July 1, 2010,
to comply with this article, and thereafter any additional health
plan contracts shall be filed pursuant to Section 1399.842. The
director shall categorize each health plan contract offered by a
health plan into the appropriate coverage choice category on or
before March 31, 2010.
(c) To facilitate consumer comparison shopping, all health plans
that offer coverage on an individual basis shall offer at least one
health plan contract in each coverage choice category, including
offering at least one of the standard contracts developed pursuant to
paragraph (4) of subdivision (a), but a health plan may offer
multiple products in each category.
(d) If a health plan offers a specific type of health plan
contract in one coverage choice category, it must offer that specific
type of health plan contract in each coverage choice category. A
"type of health plan contract" includes a preferred provider
organization, an exclusive provider organization model plan, a point
of service model plan, and a health maintenance organization model
plan.
(e) Health plans shall have flexibility in establishing provider
networks, provided that access to care standards pursuant to this
chapter are met, and provided that the provider network offered for
one health plan contract in one coverage choice category is offered
for at least one health plan contract in each coverage choice
category.
(f) A health plan shall establish prices for its products that
reflect a reasonable continuum between the products offered in the
coverage choice category with the lowest level of benefits and the
products offered in the coverage choice category with the highest
level of benefits. A health plan shall not establish a standard risk
rate for a product in a coverage choice category at a lower rate than
a product offered in a lower coverage choice category.
(g) The coverage choice category with the lowest level of benefits
shall include the benefits which meet the requirement of minimum
creditable coverage as determined by the Managed Risk Medical
Insurance Board pursuant to Section 12739.50 of the Insurance Code.
1399.833. A health plan shall offer coverage for a Healthy Action
Incentives and Rewards Program that complies with the requirements
of Section 1367.38 in at least one health plan contract in every
coverage choice category.
1399.834. The Office of the Patient Advocate shall develop and
maintain on its Internet Web site a uniform benefits matrix of all
available individual health plan contracts and individual health
insurance policies arranged by coverage choice category. This uniform
benefit matrix shall include all of the following:
(a) Benefit information submitted by health plans pursuant to
Section 1399.843 and by health insurers pursuant to Section 10940 of
the Insurance Code, including, but not limited to, the following
category descriptions:
(1) Deductibles.
(2) Copayments or coinsurance, as applicable.
(3) Annual out-of-pocket maximums.
(4) Professional services.
(5) Outpatient services.
(6) Preventive services.
(7) Hospitalization services.
(8) Emergency health services.
(9) Ambulance services.
(10) Prescription drug coverage.
(11) Durable medical equipment.
(12) Mental health and substance abuse services.
(13) Home health services.
(14) Other.
(b) The telephone number or numbers that may be used by an
applicant to contact either the department or the Department of
Insurance, as appropriate, for additional assistance.
1399.835.
When an 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 health plan contract shall become effective no
later than the first day of the following month. When that payment is
either delivered or postmarked after the 15th day of a month,
coverage shall become effective no later than the first day of the
second month following delivery or postmark of the payment.
1399.836. Except as provided in Section 1399.829, a health plan
is not required to offer an individual health plan contract and may
reject an application for an individual health plan contract in the
case of any of the following:
(a) The individual and dependents who are to be covered by the
health plan contract do not work or reside in a health plan's
approved service area.
(b) (1) Within a specific service area or portion of a service
area, if a health plan reasonably anticipates and demonstrates to the
satisfaction of the director that it will not have sufficient health
care delivery resources to assure that health care services will be
available and accessible to the eligible individual and dependents of
the individual because of its obligations to existing enrollees.
(2) A health plan that cannot offer a health plan contract to
individuals because it is lacking in sufficient health care delivery
resources within a service area or a portion of a service area may
not offer a health plan contract in the area in which the health plan
is not offering coverage to individuals until the health plan
notifies the director that it has the ability to deliver services to
new enrollees, and certifies to the director that from the date of
the notice it will enroll all individuals and groups requesting
coverage in that area from the health plan.
(c) The plan is licensed in California and meets all of the
following criteria: (1) does not offer coverage to individuals in the
commercial market; (2) requires that its members qualify through the
Medicare Program or Medi-Cal program or their successors; and (3) 75
percent or more of the organization's total enrollment premiums are
paid by the Medi-Cal program or Medicare Program, or by a combination
of Medi-Cal and Medicare payments. In no event shall this exemption
be based upon enrollment in Medicare supplement contracts, as
described in Article 3.5 (commencing with Section 1358).
(d) Any person who has been a resident of California for six
months or less unless one of the following applies: (1) the person is
a federally eligible defined individual as defined in Section
1399.801 or Section 10785 of the Insurance Code, or (2) the person
can demonstrate a minimum of two years of prior creditable coverage
at least equivalent to the minimum creditable coverage developed by
the Managed Risk Medical Insurance Board pursuant to Section 12739.50
of the Insurance Code and providing the person applies for coverage
in California within 62 days of termination or cancellation of the
prior creditable coverage.
(e) Any person who has been granted a temporary or permanent
hardship exemption from the requirement to maintain minimum
creditable coverage by the Managed Risk Medical Insurance Board
pursuant to Section 12739.501 of the Insurance Code during the time
period of the exemption as determined by the board.
1399.837. (a) If an individual disenrolls from a health plan
contract or health insurance policy or if the individual's health
plan contract or health insurance policy is canceled pursuant to
Section 1399.839 or Section 10936 of the Insurance Code prior to the
anniversary date of the health plan contract or health insurance
policy, subsequent enrollment in an individual health plan contract
or an individual health insurance policy shall be limited to the same
coverage choice category the individual was enrolled in prior to
disenrollment or cancellation.
(b) (1) An individual may change to a health plan contract in a
different coverage choice category only on the anniversary date of
the subscriber or upon a qualifying event.
(2) In no case, however, may an individual move up more than one
coverage choice category on the anniversary date of the subscriber
unless there is also a qualifying event.
(c) An individual health plan contract described in subdivision
(a) of Section 1399.826 that does not meet or exceed the requirements
for minimum creditable coverage established by the Managed Risk
Medical Insurance Board shall be deemed to be the lowest coverage
choice category for purposes of this section.
(d) On and after January 1, 2011, an individual who fails to
comply with the provisions of Chapter 15 (commencing with Section
8899.50) of Division 1 of Title 2 of the Government Code for more
than 62 days may only enroll in a health plan contract or health
insurance policy in the lowest coverage choice category. Upon the
individual's anniversary date, the individual may move to a higher
coverage choice category pursuant to subdivision (b).
(e) For purposes of this section, a qualifying event occurs upon
any of the following:
(1) Upon the death of the subscriber, on whose qualifying coverage
an individual was a dependent.
(2) Upon marriage of the subscriber or entrance by the subscriber
into a domestic partnership pursuant to Section 298.5 of the Family
Code.
(3) Upon divorce or legal separation of an individual from the
subscriber.
(4) Upon loss of dependent status by a dependent enrolled in group
health care coverage through a health care service plan or a health
insurer.
(5) Upon the birth or adoption of a child.
(6) Upon the loss of minimum creditable coverage as defined by the
Managed Risk Medical Insurance Board pursuant to Section 12739.50 of
the Insurance Code.
1399.838. The director may require a health plan to discontinue
the offering of contracts or acceptance of applications from any
individual upon a determination by the director that the health plan
does not have sufficient financial viability, or organizational and
administrative capacity to ensure the delivery of health care
services to its enrollees.
1399.839. (a) All health plan contracts offered pursuant to this
article shall be renewable with respect to all individuals and
dependents at the option of the subscriber and shall not be canceled
except for the following reasons:
(1) Failure to pay any charges for coverage provided pursuant to
the contract if the subscriber has been duly notified and billed for
those charges and at least 15 days has elapsed since the date of
notification.
(2) Fraud or intentional misrepresentation of material fact under
the terms of the health plan contract by the individual.
(3) Fraud or deception in the use of the services or facilities of
the plan or knowingly permitting that fraud or deception by another.
(4) Movement of the subscriber outside the health plan's service
area.
(5) If the health plan ceases to provide or arrange for the
provision of health care services for new or existing individual
health plan contracts in this state, provided, however, that the
following conditions are satisfied:
(A) Notice of the decision to cease new or existing individual
health plan contracts in the state is provided to the director and to
the individual at least 180 days prior to discontinuation of that
coverage.
(B) Individual health plan contracts shall not be canceled for 180
days after the date of the notice required under subparagraph (A)
and for that business of a health plan that remains in force, any
health plan that ceases to offer for sale new individual health plan
contracts shall continue to be governed by this article with respect
to business conducted under this article.
(C) A health plan that ceases to write new individual health plan
contracts in this state after the effective date of this section
shall be prohibited from offering for sale individual health plan
contracts in this state for a period of five years from the date of
notice to the director. The director may permit a health plan to
offer and sell individual health plan contracts in this state before
the five-year time period has expired if the director determines that
it is in the best interest of the state and necessary to preserve
the integrity of the health care market.
(6) If the health plan withdraws an individual health plan
contract from the market, provided that the health plan notifies all
affected individuals and the director at least 90 days prior to the
discontinuation of these health plan contracts, and that the health
plan makes available to the individual all health plan contracts with
comparable benefits that it makes available to new individual
business.
(b) On or after July 1, 2010, a health plan shall not rescind the
health plan contract of any individual.
(c) Nothing in this article shall limit any other remedies
available at law to a health plan.
1399.840. Premiums for health plan contracts offered, renewed, or
delivered by health plans on or after the effective date of this
article shall be subject to the following requirements:
(a) The premium for new or existing business shall be the standard
risk rate for an individual in a particular risk category.
(b) The premium rates shall be in effect for no less than 12
months from the date of the health plan contract.
(c) When determining the premium rate for more than one covered
individual, the health plan shall determine the rate based on the
standard risk rate for the subscriber. If more than one individual is
a subscriber, the premium rate shall be based on the age of the
youngest spouse or registered domestic partner.
(d) (1) Notwithstanding subdivision (a), for the first two years
following the implementation of this section, a health plan may apply
a risk adjustment factor to the standard risk rate that may not be
more than 120 percent or less than 80 percent of the applicable
standard risk rate. In determining the risk adjustment factor, a
health plan shall use the standardized form and uniform process
developed by the director pursuant to subdivision (f).
(2) After the first two years following the implementation of this
section, the adjustments applicable under paragraph (1) shall not be
more than 110 percent or less than 90 percent of the standard risk
rate.
(3) Upon the renewal of any contract, the risk adjustment factor
applied to the individual's rate may not be more than 5 percentage
points different than the factor applied to that rate prior to
renewal. The same limitation shall be applied to individuals with
respect to the risk adjustment factor applicable for the purchase of
a new product where the individual's prior health plan has
discontinued that product.
(4) After the first four years following the implementation of
this section, a health plan shall base rates on the standard risk
rate with no risk adjustment factor.
(e) The director and the Insurance Commissioner shall jointly
establish a maximum limit on the ratio between the standard risk
rates for contracts for individuals in the 60 to 64 years of age,
inclusive, category and contracts for individuals in the 30 to 34
years of age, inclusive, category.
(f) On or before March 1, 2009, the director shall, in
consultation with the Insurance Commissioner and the Managed Risk
Medical Insurance Board and using a qualified independent actuary,
develop a standardized form and uniform evaluation process to be used
by all health care service plans and all disability insurers
exclusively for the purpose of determining any risk adjustment rating
factor to be applied to an individual's premium rate based on actual
or expected health care use. Health plans shall base the risk
adjustment factors as authorized in this section solely on the
results of the standardized form and uniform evaluation process
developed by the director.
1399.841. (a) In connection with the offering for sale of any
health plan contract to an individual, each health plan shall make a
reasonable disclosure, as part of its solicitation and sales
materials, of all of the following:
(1) The provisions concerning the health plan's right to change
premium rates on an annual basis and the factors other than provision
of services experience that affect changes in premium rates.
(2) Provisions relating to the guaranteed issue and renewal of
health plan contracts.
(3) Provisions relating to the individual's right to obtain any
health plan contract the individual is eligible to enroll in pursuant
to Sections 1399.829 and 1399.837.
(4) The availability, upon request, of a listing of all the health
plan's contracts, including the rates for each health plan contract.
(b) Every solicitor or solicitor firm contracting with one or more
health plans to solicit enrollments or subscriptions from
individuals shall, when providing information on health plan
contracts to an individual but making no specific recommendations on
particular health plan contracts, do both of the following:
(1) Advise the individual of the health plan's obligation to sell
to any individual any health plan contract it offers to individuals
and provide him or her, upon request, with the actual rates that
would be charged to that individual for a given health plan contract.
(2) Notify the individual that the solicitor or solicitor firm
will procure rate and benefit information for the individual on any
health plan contract offered by a health plan whose contract the
solicitor sells.
(c) Prior to filing an application for a particular individual
health plan contract, the health plan shall obtain a signed statement
from the individual acknowledging that the individual has received
the disclosures required by this section.
1399.842. (a) At least 20 business days prior to offering a
health plan contract subject to this article, all health plans shall
file a notice of material modification with the director in
accordance with the provisions of Section 1352. The notice of
material modification shall include a statement certifying that the
health plan is in compliance with Sections 1399.821 and 1399.840. The
certified statement shall set forth the standard risk rate for each
risk category that will be used in setting the rates at which the
contract will be offered. Any action by the director, as permitted
under Section 1352, to disapprove, suspend, or postpone the health
plan's use of a health plan contract shall be in writing, specifying
the reasons that the health plan contract does not comply with the
requirements of this article.
(b) Prior to making any changes in the standard risk rates filed
with the director pursuant to subdivision (a), the health plan shall
file as an amendment a statement setting forth the changes and
certifying that the health plan is in compliance with Sections
1399.821 and 1399.840. If the standard risk rate is being changed, a
health plan may commence offering health plan contracts utilizing the
changed standard risk rate upon filing the certified statement
unless the director disapproves the amendment by written notice.
(c) Periodic changes to the standard risk rate that a health plan
proposes to implement over the course of up to 12 consecutive months
may be filed in conjunction with the certified statement filed under
subdivision (a) or (b).
(d) Each health plan shall maintain at its principal place of
business all of the information required to be filed with the
director pursuant to this article.
(e) This section shall become operative on July 1, 2009.
1399.843. (a) A health plan shall include all of the following in
the material modification notice filed pursuant to subdivision (a)
of Section 1399.842:
(1) A summary explanation of the following for each health plan
contract offered to individuals:
(A) Eligibility requirements.
(B) The full premium cost of each health plan contract in each
risk category, as defined in subdivision (k) of Section 1399.821.
(C) When and under what circumstances benefits cease.
(D) Other coverage that may be available if benefits under the
described health plan contract cease.
(E) The circumstances under which choice in the selection of
physicians and providers is permitted.
(F) Deductibles.
(G) Annual out-of-pocket maximums.
(2) A summary explanation of coverage for the following, together
with the corresponding copayments, coinsurance, and applicable
limitations for each health plan contract offered to individuals:
(A) Professional services.
(B) Outpatient services.
(C) Preventive services.
(D) Hospitalization services.
(E) Emergency health coverage.
(F) Ambulance services.
(G) Prescription drug coverage.
(H) Durable medical equipment.
(I) Mental health and substance abuse services.
(J) Home health services.
(3) The telephone number or numbers that may be used by an
applicant to access a health plan customer service representative to
request additional information about the health plan contract.
(b) The department shall share the information provided by health
plans pursuant to this article with the Office of the Patient
Advocate for purposes of the development, creation, and maintenance
of the comparative benefits matrix.
1399.844. (a) The Director of the Department of Managed Health
Care shall, in consultation with the Insurance Commissioner, an
outside actuarial firm, and health plans and insurers participating
in the individual market, no later than July 1, 2010, develop and
implement mechanisms to assist health plans and health insurers in
managing the risk of providing health coverage in the individual
market on a guarantee issue basis to the extent that these mechanisms
can improve access to individual coverage.
(b) The mechanisms required under subdivision (a) shall include
methods for collecting information regarding the enrollment, prices,
rate variance, and any other information that may be required to
monitor the condition of the individual market, the risk exposure of
individual health plans and i