Amended  IN  Senate  March 30, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Senate Bill No. 199

Introduced by Senator Hernandez

January 30, 2017

An act to repeal and add Chapter 8 (commencing with Section 127670) of Part 2 of Division 107 of add Section 127672 to the Health and Safety Code, relating to health care.


LEGISLATIVE COUNSEL'S DIGEST


SB 199, as amended, Hernandez. The California Health Care Cost, Quality, and Equity Database. Atlas.
Existing law requires the California Health and Human Services Agency to research the options for developing a cost, quality, and equity data atlas. Existing law requires the research to include certain topics, including, among others, identification of key data submitters and submitters, a comparative analysis of potential models used in other states. states, and an assessment of types of governance structures that incorporate representatives of health care stakeholders and experts. Existing law requires the agency to have made the results of the above-described research available to the public no later than March 1, 2017, by submitting a report to the Assembly and Senate Committees on Health.
This bill would require the Secretary of California Health and Human Services, in furtherance of the goal of creating the California Health Care Cost, Quality, and Equity Atlas, to convene an advisory committee composed of a broad spectrum of health care stakeholders and experts, as specified. The bill would require the secretary to charge the advisory committee with identifying the type of data, purpose of use, and entities and individuals that are required to report to, or that may have access to, a health care cost, quality, and equity atlas, and with developing a set of recommendations based on specified findings of the March 1, 2017, report.

This bill would delete the above requirements and would instead require certain health care entities, including health care service plans, health insurers, and health care providers to provide specified information to the Secretary of California Health and Human Services, including, but not limited to, utilization data and health care pricing information. The bill would authorize the secretary to report a health care entity that fails to comply with the above-described requirement to the health care entity’s regulating agency and would authorize the regulating agency to enforce that requirement using its existing enforcement procedures.

This bill would require all data disclosures made pursuant to these provisions to comply with all applicable state and federal laws for the protection of the privacy, security, and confidentiality of data and would prohibit the disclosure of any unaggregated, individually identifiable health information or medical information. The bill would also require individually identifiable health information and medical information to be protected by security measures, including, but not limited to, encryption. The bill would require that certain confidentially negotiated contract terms be protected in data disclosures made pursuant to these provisions and would prohibit certain individually identifiable proprietary contract information from being disclosed in an unaggregated format. The bill would authorize the secretary to enter into contracts or agreements to share the information collected, under prescribed conditions.

This bill would also require the secretary to convene an advisory committee composed of a broad spectrum of health care stakeholders and experts, as specified, to identify the type of data, purpose of use, and entities and individuals that are required to report to, or that may have access to, a health care cost, quality, and equity database. The bill would require the secretary to arrange for the preparation of a report to the Legislature and the Governor, to be submitted by January 1, 2020, that examines and addresses specified issues, including, among others, containing the cost of health care services and coverage and improving the quality and medical appropriateness of health care. The bill would prohibit members of the committee from receiving a per diem or travel expense reimbursement, or any other expense reimbursement.

Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

This bill would make legislative findings to that effect.

Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 127672 is added to the Health and Safety Code, to read:

127672.
 (a) In furtherance of the goal of creating the California Health Care Cost, Quality, and Equity Atlas, the Secretary of California Health and Human Services shall convene an advisory committee composed of a broad spectrum of health care stakeholders and experts, including, but not limited to, all of the following:
(1) Health care service plans, including specialized health care service plans.
(2) Insurers that have a certificate of authority from the Insurance Commissioner to provide health insurance, as defined in Section 106 of the Insurance Code.
(3) Suppliers, as defined in paragraph (3) of subdivision (b) of Section 1367.50.
(4) Providers, as defined in paragraph (2) of subdivision (b) of Section 1367.50.
(5) Self-insured employers.
(6) Multiemployer self-insured plans that are responsible for paying for health care services provided to beneficiaries or the trust administrator for a multiemployer self-insured plan.
(7) Businesses that purchase health care coverage for their employees.
(8) Organized labor.
(9) Consumers.
(b) (1) The secretary shall charge the advisory committee with the task of identifying the type of data, purpose of use, and entities and individuals that are required to report to, or that may have access to, a health care cost, quality, and equity atlas.
(2) The advisory committee shall hold public meetings with stakeholders, solicit input, and set its own meeting agendas. Meetings of the advisory committee are subject to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code).
(c) The advisory committee shall develop recommendations based on the findings of the report required pursuant to Section 127670, including, but not limited to, all of the following:
(1) The type of technology solutions identified in the report required pursuant to Section 127670, including building a new database or leveraging existing databases, or developing a network of networks, as described in the report, to facilitate a hybrid version of the two options.
(2) Prioritization of use cases described in the report.
(3) Identification of financing mechanisms for the creation and sustainability of the system, as identified in the report.
(4) Identification of a governance structure.
(d) Notwithstanding any other law, the members of the advisory committee shall not receive per diem or travel expense reimbursement, or any other expense reimbursement.

SECTION 1.

It is the intent of the Legislature in enacting this act to make cost and quality data available and to encourage health care service plans, health insurers, and providers to develop innovative approaches, services, and programs that may have the potential to deliver health care that is both cost effective and responsive to the needs of enrollees and insureds, including recognizing the diversity of California and the impact of social determinants of health.

SEC. 2.Chapter 8 (commencing with Section 127670) of Part 2 of Division 107 of the Health and Safety Code, as added by Section 3 of Chapter 727 of the Statutes of 2016, is repealed.
SEC. 3.Chapter 8 (commencing with Section 127670) is added to Part 2 of Division 107 of the Health and Safety Code, to read:
8.California Health Care Cost, Quality, and Equity Database
127670.

(a)(1)Solely for the purpose of developing information for inclusion in a health care cost, quality, and equity database, and consistent with paragraph (9) of subdivision (b) of Section 56.10 of the Civil Code, a health care service plan, including a specialized health care service plan, an insurer licensed to provide health insurance, as defined in Section 106 of the Insurance Code, a supplier, as defined in paragraph (3) of subdivision (b) of Section 1367.50, or a provider, as defined in paragraph (2) of subdivision (b) of Section 1367.50, shall, and a self-insured employer, a multiemployer self-insured plan that is responsible for paying for health care services provided to beneficiaries, and the trust administrator for a multiemployer self-insured plan may, provide all of the following to the Secretary of California Health and Human Services:

(A)Utilization data from the health care service plans’ and insurers’ medical, dental, and pharmacy claims or, in the case of entities that do not use claims data, including, but not limited to, integrated delivery systems, encounter data consistent with the core set of data elements for data submission proposed by the All-Payer Claims Database Council, the University of New Hampshire, and the National Association of Health Data Organizations.

(B)Pricing information for health care items, services, and medical and surgical episodes of care gathered from allowed charges for covered health care items and services or, in the case of entities that do not use or produce individual claims, price information that is the best possible proxy to pricing information for health care items, services, and medical and surgical episodes of care available in lieu of actual cost data to allow for meaningful comparisons of provider prices and treatment costs.

(C)Information sufficient to determine the impacts of social determinants of health, including age, gender, race, ethnicity, limited English proficiency, sexual orientation and gender identity, ZIP Code, and any other factors for which there is peer-reviewed evidence.

(2)(A)The secretary may report an entity’s failure to comply with paragraph (1) to the entity’s regulating agency.

(B)The regulating agency of an entity described in paragraph (1) may enforce paragraph (1) using its existing enforcement procedures. Notwithstanding any other law, moneys collected pursuant to this authorization shall be subject to appropriation by the Legislature, and the failure to comply with paragraph (1) is not a crime.

(b)(1)(A)Subject to paragraph (9) of subdivision (b) of Section 56.10 of the Civil Code, all uses and disclosures of data made pursuant to this section shall comply with all applicable state and federal laws for the protection of the privacy and security of data, including, but not limited to, the Confidentiality of Medical Information Act (Part 2.6 (commencing with Section 56) of Division 1 of the Civil Code), the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Title 1.8 of Part 4 of Division 3 of the Civil Code), Title 1.81 (commencing with Section 1798.80) of Part 4 of Division 3 of the Civil Code, and the federal Health Insurance Portability and Accountability Act of 1996 (Public Law 104-191), and the federal Health Information Technology for Economic and Clinical Health Act, Title XIII of the federal American Recovery and Reinvestment Act of 2009 (Public Law 111-5), and implementing regulations.

(B)Use and disclosure of data pursuant to this section shall be consistent with privacy and security protections for individually identifiable health information and medical information under state and federal law, including any applicable exceptions to the requirement to obtain patient authorization, including, but not limited to, paragraph (9) of subdivision (b) of, and paragraph (7) of subdivision (c) of, Section 56.10 of the Civil Code.

(2)(A)All policies and protocols developed pursuant to this section shall ensure that the privacy, security, and confidentiality of individually identifiable health information and medical information is protected. The secretary shall not disclose any unaggregated, individually identifiable health information or medical information and shall develop a protocol for assessing the risk of reidentification stemming from disclosure of any health information and medical information that is aggregated, individually identifiable health information, or medical information. This paragraph does not preclude sharing individually identifiable health information that is not aggregated with researchers for research purposes, consistent with paragraph (7) of subdivision (c) of Section 56.10 of the Civil Code.

(B)For the purposes of this paragraph, the following terms have the following meanings:

(i)“Individually identifiable health information” has the same meaning as in Section 160.103 of Title 45 of the Code of Federal Regulations.

(ii)“Medical information” has the same meaning as in Section 56.05 of the Civil Code.

(3)Confidentially negotiated contract terms contained in a contract between a health care service plan or insurer and a provider or supplier shall be protected in any public disclosure of data made pursuant to this section. Individually identifiable proprietary contract information included in a contract between a health care service plan or insurer and a provider or supplier shall not be disclosed in an unaggregated format.

(c)The secretary may enter into contracts or agreements to share the information collected under this section for the purposes of this chapter, provided that any use of that information complies with the requirements of this section.

(d)(1)The agency administering the California Health Care Cost, Quality, and Equity Database shall adopt rigorous standards of security protection to ensure as nearly as possible that the information contained in and collected for the purposes of the California Health Care Cost, Quality, and Equity Database is not compromised. This shall include, but is not limited to, requiring encryption.

(2)For the purposes of paragraph (1), the term “encryption” means the protection of data in electronic form, in storage or in transit, using an encryption technology that has been generally accepted by experts in the field of information security that renders data indecipherable in the absence of associated cryptographic keys necessary to enable decryption of the data. “Encryption” includes appropriate management and safeguards of cryptographic keys to protect the integrity of the encryption.

(e)For purposes of this section, the California Health and Human Services Agency is an agency subject to Chapter 1 (commencing with Section 1798) of Title 1.8 of Part 4 of Division 3 of the Civil Code.

127672.

(a)The secretary shall convene an advisory committee, composed of a broad spectrum of health care stakeholders and experts, including, but not limited to, representatives of the entities that are required to provide information pursuant to subdivision (a) of Section 127670 and representatives of purchasers, including, but not limited to, businesses, organized labor, and consumers, to identify the type of data, purpose of use, and entities and individuals that are required to report to, or that may have access to, a health care cost, quality, and equity database. The advisory committee shall hold public meetings with stakeholders, solicit input, and set its own meeting agendas. Meetings of the advisory committee are subject to the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code).

(b)The secretary shall arrange for the preparation of a report, which shall be submitted to the Legislature and the Governor, on or before January 1, 2020, based on the findings of the advisory committee, including input from the public meetings, that shall, at a minimum, examine and address the following issues:

(1)Assessing California health care needs and available resources.

(2)Containing the cost of health care services and coverage.

(3)Improving the quality and medical appropriateness of health care.

(4)Reducing health disparities and addressing the social determinants of health.

(5)Increasing the transparency of health care costs and the relative efficiency with which care is delivered.

(6)Use of disease management, wellness, prevention, and other innovative programs to keep people healthy, reduce disparities and costs, and improve health outcomes for all populations.

(7)Efficient utilization of prescription drugs and technology.

(8)Reducing unnecessary, inappropriate, and wasteful health care.

(9)Educating consumers in the use of health care information.

(c)(1)A report submitted under subdivision (b) shall be submitted in compliance with Section 9795 of the Government Code.

(2)The requirement for submitting a report pursuant to subdivision (b) is inoperative on July 1, 2023, pursuant to Section 10231.5 of the Government Code.

(d)Notwithstanding any other law, the members of the advisory committee shall not receive per diem or travel expense reimbursement, or any other expense reimbursement.

SEC. 4.

The Legislature finds and declares that Section 3 of this act, which adds Section 127670 of the Health and Safety Code, imposes a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:

In order to protect confidential and proprietary information submitted to the secretary, it is necessary for that information to remain confidential.