Gov. Brown Signs, Vetoes Health Care Reform Bills

Governor Jerry Brown signed the several health reform-related bills into law:

California Health Benefit Exchange

• AB 792 establishes notification requirements about reduced-cost coverage in the California Health Benefit Exchange and no-cost coverage in Medi-Cal for individuals in the following situations: filing a dissolution or nullity of marriage, divorce, or separation; petitioning for adoption; or no longer being enrolled in health coverage through a health plan or health insurer.
AB 1761 gives enforcement authority to the Department of Managed Health Care (DMHC) and the Commissioner of the California Department of Insurance (CDI) over licensees (and solicitors) who claim to provide services on behalf of the California Health Benefit Exchange without having a valid agreement.

Pre-existing Conditions

• AB 1083 eliminates pre-existing condition requirements and establishes premium-rating factors based only on age, family size, and geographic regions (except for grandfathered plans). If guaranteed issue and rating factors are repealed in the ACA, California’s existing guaranteed issue and rating law pre-ACA would become operative.
• AB 1083 establishes that small business owners cannot be subject to additional premium hikes based on their employees’ health.

Essential health benefits

• AB 1453 establishes the Kaiser Small Group HMO 330 plan contract as California’s Essential Health Benefits benchmark plan for individual and small group health plan products licensed by the Department of Managed Health Care. SB 951 provides that this provision applies regardless of whether a contract or policy is offered inside or outside the state exchange.

Major Risk Medical Program

• AB 1526 allows the Managed Risk Medical Insurance Board to further subsidize the premium contributions paid by individuals who receive coverage in the Major Risk Medical Insurance Program from January 1, 2013 to December 31, 2013.

Enrollment in State Programs

• AB 1580 streamlines eligibility and enrollment processes for various programs to provide health care coverage to those with limited financial resources, including the Medi-Cal program and the Healthy Families Program.

CO-OPS

• AB 1846 establishes a licensing framework at CDI and DMHC for consumer operated and oriented plans (CO-OPs).

• AB 970 authorizes, upon consent of the applicant, information provided for the single state application for health subsidy programs to be used to meet requirements for new or continued eligibility in the California Work Opportunity and Responsibility to Kids (CalWORKs) and CalFresh programs.

Lifetime Caps

•  AB 1526 eliminates annual and lifetime caps from the Managed Risk Medical Insurance Program.

Appeals

•  SB 1410 clarifies the process under which consumers appeal denial-of-care decisions.

The Governor gave the following explanations for vetoing the following bills:

• AB 1000 would have prohibited a higher copayment, deductible, or coinsurance amount for a prescribed, orally administered anticancer medication than what is required for an intravenously administered or injected cancer medication): This bill doesn’t distinguish between health plans and insurers who make these drugs available at a reasonable cost and those who do not.
• AB 1461 would have required health plans to guarantee health plan contracts without pre-existing condition requirements during initial, annual, and special enrollment periods: Without the strong foundation that federal law provides, a state-level mandate on insurers, alone, could encourage healthy people to wait until they got sick or injured before purchasing coverage. This would lead to skyrocketing premiums, making coverage more unaffordable.
• AB 2152 would have established notification requirements on PPOs licensed by the DMHC and the CDI when a terminated provider contract affects 800 or more covered lives. It specified patient disclosure for terminations affecting 2,000 or more covered lives: It provides for stronger notification procedures at the Department of Insurance, but weakens the notification procedures under existing law at the Department of Managed Health Care.
• AB 2162 would have adjusted the dollar increments for investments and income that public officials use in filing a Statement of Economic Interest: The law already requires public officials to disclose their income and investments with enough particularity so that conflicts of interest can be identified.
• SB 359: I share the goals of this legislation to reign in excessive hospital charges for out-of-network emergency care.  I am not convinced, however, that the rate-setting formula in this bill has it right.
• SB 393 would have would have defined a patient-centered medical home: More work is needed before we codify the definition contained in this bill.
• SB 411 and SB 878 would have established a new regulatory scheme for the private home care industry: I understand the argument for stronger oversight. But given the economic stresses and uncertainty, I am not prepared to embark upon the institutional changes and costs that this bill entails.
• SB 961 would have required a health insurer to offer all of the insurer’s health benefit plans that are sold in the individual market to all individuals and dependents in each service area. Insurers would have been required to limit enrollment in individual health benefit plans to specified open enrollment and special enrollment periods: This billed failed to link our state reforms to federal law.

For the full text of the bills, visit: http://leginfo.ca.gov/bilinfo.html.

Last Updated 8/2/2017

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