Amended  IN  Senate  June 26, 2018
Amended  IN  Senate  June 11, 2018
Amended  IN  Assembly  April 16, 2018
Amended  IN  Assembly  March 23, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 2472
Introduced by Assembly Member Wood
(Coauthors: Assembly Members Arambula, Chiu, Friedman, Aguiar-Curry, and Gonzalez Fletcher)

February 14, 2018

An act to add Section 100523 to the Government Code, and to add Section 1360.7 to the Health and Safety Code, relating to health care coverage.


LEGISLATIVE COUNSEL'S DIGEST

AB 2472, as amended, Wood. Health care coverage: Covered California.
(1) Existing federal law, the federal Patient Protection and Affordable Care Act (PPACA), enacts various health care coverage market reforms that took effect January 1, 2014. Among other things, PPACA required each state to establish an American Health Benefit Exchange to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.
Existing state law establishes the California Health Benefit Exchange, also known as Covered California, within state government. Existing law specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers.
This bill would require the board to prepare an analysis and evaluation, known as a feasibility analysis, to determine the feasibility of a public health insurance plan option to increase competition and choice for health care consumers. The bill would require the feasibility analysis to contain, among other things, an actuarial and economic analysis of a public health insurance plan and an analysis of the extent to which a new public health insurance plan option could address the underlying factors that limit health plan choices in some regions. The bill would require the board to submit the feasibility analysis to the Legislature on or before January 1, 2020.
(2) Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans, including individual health benefit plans, by the Department of Managed Health Care, and makes a willful violation of its provisions a crime. Existing law also provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services.
This bill, commencing on January 1, 2020, would require a health care service plan that has a contract with the State Department of Health Care Services to offer Medi-Cal managed care plans or prepaid health plans, and that meets other specified criteria, to offer to negotiate with the Exchange each year regarding offering individual products on the Exchange in the plan’s approved service areas that overlap with counties in which there are were 2 or fewer health care service plans offering products on the Exchange, as specified. Exchange during the preceding year. The bill would require a health care service plan that is required to offer to negotiate with the Exchange pursuant to the bill to comply with the requirements in the Exchange’s qualified health plan certification application, including all applicable timelines. Because a willful violation of the bill’s requirements would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Digest Key Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  
Bill Text
The people of the State of California do enact as follows:
SECTION 1. (a) The Legislature finds and declares all of the following:
(1) A review of health plans contracted through Covered California in 2018 by ZIP Code indicates that there are approximately 213 ZIP Codes or portions of ZIP Codes, constituting 8 percent of ZIP Codes or portions of ZIP Codes in California, in which consumers have only one choice for a health plan, and approximately 635 ZIP Codes or portions of ZIP Codes, constituting 24 percent of ZIP Codes or portions of Zip Codes in California, in which consumers are limited to two health plan choices.
(2) Consumers have only one health plan choice in the Counties of Monterey, San Benito, San Luis Obispo, Santa Barbara, Inyo, and Mono, and in most of Kings County.
(3) Twenty-two additional counties have two or fewer health plan choices in all the ZIP Codes or portions of ZIP Codes in those counties. For approximately one-third of the ZIP Codes in California, consumers are limited to two or fewer health plan choices in their regions.
(b) It is the intent of the Legislature to look at options to improve competition in areas with limited health plan choices.
SEC. 2. Section 100523 is added to the Government Code, to read:
100523. (a) The board shall prepare an analysis and evaluation, known as a feasibility analysis, to determine the feasibility of a public health insurance plan option to increase competition and choice for health care consumers.
(b) At a minimum, the feasibility analysis shall include all of the following:
(1) An actuarial and economic analysis of a public health insurance plan.
(2) A plan to expand the participation of public health plans, including state-licensed county organized health systems and local health plans.
(3) A state developed public health insurance plan.
(4) A list of necessary federal waivers for a state-developed public health insurance plan.
(5) A discussion of potential funding and state costs for a public health insurance plan.
(6) An analysis of the extent to which a new public health insurance plan option could address the underlying factors that limit health plan choices in some regions.
(c) In developing the feasibility analysis, the board shall consult with key stakeholders, including, but not limited to, consumer advocates, health care providers, and health plans, including, but not limited to, county organized health systems and local health plans.
(d) The board shall submit the feasibility analysis to the Legislature on or before January 1, 2020. The feasibility analysis shall be submitted in compliance with Section 9795.
(e) This section does not authorize the Exchange to apply for a waiver under Section 1332 of the federal act as defined in subdivision (e) of Section 100501.
SEC. 3. Section 1360.7 is added to the Health and Safety Code, to read:
1360.7. (a) On or after January 1, 2020, a health care service plan that has a contract with the State Department of Health Care Services pursuant to Chapter 7 (commencing with Section 14000) or Chapter 8 (commencing with Section 14200) of Part 3 of Division 9 of the Welfare and Institutions Code, and that meets the criteria specified in subdivision (b), shall offer to negotiate with the Exchange each year regarding offering individual products on the Exchange in the plan’s approved service areas that overlap with counties in which there are were two or fewer health care service plans offering products on the Exchange as of the plan year beginning in 2018. during the preceding year.
(b) A health care service plan required to offer to negotiate with the Exchange pursuant to subdivision (a) shall meet the following criteria:
(1) The health care service plan is licensed to offer Medi-Cal managed care, as a Knox-Keene licensed entity, through its existing license, subsidiary, or affiliate.
(2) The health care service plan, or its subsidiary or affiliate, is licensed to offer individual products in the individual market both on and off the Exchange.
(3) The health care service plan, or its subsidiary or affiliate, has been previously approved to offer individual products in the individual market in counties in which there are two or fewer health care service plans offering products on the Exchange.
(c) A health care service plan required to offer to negotiate with the Exchange pursuant to subdivision (a) shall comply with the requirements in the Exchange’s qualified health plan certification application, including all applicable timelines. This section does not require the Exchange to contract with any health plan that it negotiates with, or to certify any individual products that do not meet the certification requirements.
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.