Bill Text: CA AB248 | 2015-2016 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Health insurance: minimum value: large group market policies.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Passed) 2015-10-08 - Chaptered by Secretary of State - Chapter 617, Statutes of 2015. [AB248 Detail]

Download: California-2015-AB248-Introduced.html

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BILL NUMBER: AB 248	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Roger Hernández

                        FEBRUARY 9, 2015

   An act to add Section 1367.010 to the Health and Safety Code, and
to add Section 10112.9 to the Insurance Code, relating to health care
coverage.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 248, as introduced, Roger Hernández. Health insurance: minimum
value: large group market policies.
   Existing law, the federal Patient Protection and Affordable Care
Act (PPACA), enacts various health care coverage market reforms that
take effect January 1, 2014, and exempts health insurance coverage
that provides excepted benefits from those reforms. PPACA requires
each state to establish an American Health Benefits Exchange and
allows qualified individuals to obtain premium assistance for
coverage purchased through the Exchange. PPACA specifies that this
premium assistance is not available if the individual is eligible for
affordable employer-sponsored coverage that provides minimum value,
as specified.
   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 provides for the
regulation of health insurers by the Insurance Commissioner. Existing
law requires that health benefit plans issued by health insurers and
health care service plans in the small group market and the
individual market comply with specified requirements. Existing law
defines a health benefit plan for the purpose of health benefit plans
issued by health insurers to exclude a policy or certificate of
specified disease or hospital confinement indemnity if the insurer
certifies to the commissioner that the policy is being offered as
supplemental health insurance and not as a substitute for essential
health benefits. Existing law requires an insurer issuing these
policies in the small group market or the individual market to
require that the persons to be covered are covered by coverage that
is not designed to serve as supplemental coverage.
   This bill would extend that requirement to a health care service
plan that offers, amends, or renews a group health plan contract and
an insurer issuing a policy, except a health care service plan or
insurer issuing a specialized health care service plan or policy,
that provides less than 60% minimum value in the large group market
and would require that the persons to be covered are also covered by
a contract or plan that provides at least 60% minimum value. The bill
would not apply to limited wraparound coverage, as described in a
specified federal regulation, from these provisions. This bill would
exempt an insurer that is subject to specified disclosure
requirements from these provisions. By expanding the scope of an
existing crime, this bill would impose a state-mandated local
program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  (a) The Legislature finds and declares that an employee
of a large employer who accepts health coverage from his or her
employer that is less than 60 percent minimum value is barred by
federal guidance from obtaining federal tax credits for affordable
health coverage through Covered California.
   (b) It is the intent of the Legislature in enacting this act to
ensure that employees of large employers who are offered health
coverage by their employers are offered coverage that meets or
exceeds 60 percent minimum value, the minimum standard for
comprehensive employer coverage under federal law. This requirement
applies if an employer purchases that health coverage from a health
plan or health insurer regulated by the State of California.
  SEC. 2.  Section 1367.010 is added to the Health and Safety Code,
to read:
   1367.010.  (a) (1) A health care service plan, except a health
care service plan offering a specialized health care service plan
contract, that offers, amends, or renews a large group health care
service plan contract shall not market, offer, amend, or renew a
large group plan contract that provides a minimum value of less than
60 percent.
   (2) This section shall not apply to limited wraparound coverage,
consistent with Section 146.145(b) of Title 45 of the Code of Federal
Regulations.
   (b) For purposes of this section, a plan provides a minimum value
of at least 60 percent if it complies with Section 36B(c)(2)(C) of
the federal Internal Revenue Code and any regulation or guidance
adopted under that section.
   (c) The following definitions apply for purposes of this section:
   (1) "Large group health care service plan contract" means a group
health care service plan contract other than a contract issued to a
"small employer", as defined in Section 1357, 1357.500, or 1357.600.
   (2) "Plan year" has the meaning set forth in Section 144.103 of
Title 45 of the Code of Federal Regulations.
  SEC. 3.  Section 10112.9 is added to the Insurance Code, to read:
   10112.9.  (a) (1) An insurer, except an insurer issuing a
specialized health insurance policy, issuing a policy or certificate
of health insurance shall not market, offer, amend, issue or renew a
large group plan contract that provides a minimum value of less than
60 percent.
   (2) This section shall not apply to limited wraparound coverage,
that is consistent with Section 146.145(b) of Title 45 of the Code of
Federal Regulations.
   (b) For purposes of this section, a plan provides a minimum value
of at least 60 percent if it complies with Section 36B(c)(2)(C) of
the federal Internal Revenue Code and any regulations or guidance
adopted under that section.
   (c) This section shall not apply to an insurer that is subject to
the disclosure requirements described in Section 10198.61.
   (d) For purposes of this section, the following definitions apply:

   (1) "Large group" means a group that is not a "small employer", as
defined in Section 10753.
   (2) "Plan year" has the meaning set forth in Section 144.103 of
Title 45 of the Code of Federal Regulations.
  SEC. 4.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.