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AB-1670 Health care coverage.(2019-2020)

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Date Published: 03/18/2019 09:00 PM
AB1670:v98#DOCUMENT

Amended  IN  Assembly  March 18, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 1670


Introduced by Assembly Member Holden

February 22, 2019


An act to amend Section 1367.01 of add Section 1371.85 to the Health and Safety Code, and to add Section 10112.85 to the Insurance Code, relating to health care coverage.


LEGISLATIVE COUNSEL'S DIGEST


AB 1670, as amended, Holden. Health care coverage.
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 Department of Insurance. Under existing law, if a health care service plan or insurer, or one of its contracting providers, denies, modifies, or delays a health care service because the proposed service is not a covered benefit, the statement of that decision is to clearly specify the provision in the policy or contract that excludes that coverage.
This bill would authorize a provider that contracts with a health care service plan or health insurer to bill an enrollee or insured for a service that is not a covered benefit if the enrollee or insured consents in writing and that written consent meets specified criteria. The bill would require a contracting provider to provide an enrollee or insured with a written estimate of the person’s total cost, based on the standard rate the provider would charge for the service, if the service sought is not a covered benefit under the person’s health care service plan contract or health insurance policy. The bill would require these written consent and estimate documents to be in the language spoken by the enrollee or insured, if the language is a primary language of a limited-English-proficient population group meeting a specified numeric threshold. 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.
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.

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 its provisions a crime. Existing law requires a health care service plan to have written policies and procedures establishing the process by which the plan approves, modifies, delays, or denies requests for health care services based in whole or in part on medical necessity, including those plans that delegate these functions to medical groups, independent practice associations, or to other contracting providers. As part of that process, existing law requires health care service plans to communicate decisions to approve, modify, or deny requests to the enrollee and the requesting provider within a specified timeframe.

This bill would make technical, nonsubstantive changes to those provisions.

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

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


SECTION 1.

 Section 1371.85 is added to the Health and Safety Code, to read:

1371.85.
 (a) If a contracting provider identifies that a service sought by an enrollee is not a covered benefit, the contracting provider may bill or collect from the enrollee if the enrollee consents in writing, and that written consent demonstrates that all of the following are met:
(1) The enrollee consented in writing to receive services from the contracting provider at least 24 hours before the services were provided.
(2) The written consent is in a separate document from the document used to obtain consent for any other part of the service.
(3) The written consent was not obtained by the facility or a representative of the facility.
(4) The written consent was not obtained at the time of admission or at a time when the enrollee was being prepared for surgery or another procedure.
(5) At the time the written consent was provided, the contracting provider gave the enrollee a written estimate of the enrollee’s total cost.
(6) The enrollee was advised that the enrollee may elect to seek care from another provider or may contact the enrollee’s health care service plan to arrange to receive the service from a contracted provider for lower out-of-pocket costs.
(b) If a contracting provider identifies that a service sought by an enrollee is not a covered benefit, the contracting provider shall provide the enrollee with a written estimate of the enrollee’s total cost, based on the standard rate the provider would charge for the service.
(c) The contracting provider shall not attempt to collect more than the estimated amount provided pursuant to subdivision (b) without receiving separate written consent from the enrollee or the enrollee’s representative, unless circumstances arise during the delivery of services that were unforeseeable at the time the estimate was given and that require the contracting provider to change the estimate.
(d) The written consent and the written estimate provided pursuant to subdivisions (a) and (b) shall be in the language spoken by the enrollee, if the language is a Medi-Cal threshold language, as defined in subdivision (d) of Section 128552.

SEC. 2.

 Section 10112.85 is added to the Insurance Code, to read:

10112.85.
 (a) If a contracting provider identifies that a service sought by an insured is not a covered benefit, the contracting provider may bill or collect from the insured if the insured consents in writing, and that written consent demonstrates that all of the following are met:
(1) The insured consented in writing to receive services from the contracting provider at least 24 hours before the services were provided.
(2) The written consent is in a separate document from the document used to obtain consent for any other part of the service.
(3) The written consent was not obtained by the facility or a representative of the facility.
(4) The written consent was not obtained at the time of admission or at a time when the insured was being prepared for surgery or another procedure.
(5) At the time the written consent was provided, the contracting provider gave the insured a written estimate of the insured’s total cost.
(6) The insured was advised that the insured may elect to seek care from another provider or may contact the insured’s health insurer to arrange to receive the service from a contracted provider for lower out-of-pocket costs.
(b) If a contracting provider identifies that a service sought by an insured is not a covered benefit, the contracting provider shall provide the insured with a written estimate of the insured’s total cost, based on the standard rate the provider would charge for the service.
(c) The contracting provider shall not attempt to collect more than the estimated amount provided pursuant to subdivision (b) without receiving separate written consent from the insured or the insured’s representative, unless circumstances arise during the delivery of services that were unforeseeable at the time the estimate was given and that require the contracting provider to change the estimate.
(d) The written consent and the written estimate provided pursuant to subdivisions (a) and (b) shall be in the language spoken by the insured, if the language is a Medi-Cal threshold language, as defined in subdivision (d) of Section 128552 of the Health and Safety Code.

SEC. 3.

 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.
SECTION 1.Section 1367.01 of the Health and Safety Code is amended to read:
1367.01.

(a)A health care service plan and any entity with which it contracts for services that include utilization review or utilization management functions, that prospectively, retrospectively, or concurrently reviews and approves, modifies, delays, or denies, based in whole or in part on medical necessity, requests by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees, or that delegates these functions to medical groups or independent practice associations or to other contracting providers, shall comply with this section.

(b)A health care service plan that is subject to this section shall have written policies and procedures establishing the process by which the plan prospectively, retrospectively, or concurrently reviews and approves, modifies, delays, or denies, based in whole or in part on medical necessity, requests by providers of health care services for plan enrollees. These policies and procedures shall ensure that decisions based on the medical necessity of proposed health care services are consistent with criteria or guidelines that are supported by clinical principles and processes. These criteria and guidelines shall be developed pursuant to Section 1363.5. These policies and procedures, and a description of the process by which the plan reviews and approves, modifies, delays, or denies requests by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees, shall be filed with the director for review and approval, and shall be disclosed by the plan to providers and enrollees upon request, and by the plan to the public upon request.

(c)A health care service plan subject to this section, except a plan that meets the requirements of Section 1351.2, shall employ or designate a medical director who holds an unrestricted license to practice medicine in this state issued pursuant to Section 2050 of the Business and Professions Code or pursuant to the Osteopathic Act, or, if the plan is a specialized health care service plan, a clinical director with California licensure in a clinical area appropriate to the type of care provided by the specialized health care service plan. The medical director or clinical director shall ensure that the process by which the plan reviews and approves, modifies, or denies, based in whole or in part on medical necessity, requests by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees complies with the requirements of this section.

(d)If health plan personnel, or individuals under contract to the plan to review requests by providers, approve the provider’s request, pursuant to subdivision (b), the decision shall be communicated to the provider pursuant to subdivision (h).

(e)No individual, other than a licensed physician or a licensed health care professional who is competent to evaluate the specific clinical issues involved in the health care services requested by the provider, may deny or modify requests for authorization of health care services for an enrollee for reasons of medical necessity. The decision of the physician or other health care professional shall be communicated to the provider and the enrollee pursuant to subdivision (h).

(f)The criteria or guidelines used by the health care service plan to determine whether to approve, modify, or deny requests by providers prior to, retrospectively, or concurrent with, the provision of health care services to enrollees shall be consistent with clinical principles and processes. These criteria and guidelines shall be developed pursuant to the requirements of Section 1363.5.

(g)If the health care service plan requests medical information from providers in order to determine whether to approve, modify, or deny requests for authorization, the plan shall request only the information reasonably necessary to make the determination.

(h)In determining whether to approve, modify, or deny requests by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees, based in whole or in part on medical necessity, a health care service plan subject to this section shall meet the following requirements:

(1)Decisions to approve, modify, or deny, based on medical necessity, requests by providers prior to, or concurrent with the provision of health care services to enrollees that do not meet the requirements for the time period for review required by paragraph (2) shall be made in a timely fashion appropriate for the nature of the enrollee’s condition, not to exceed five business days from the plan’s receipt of the information reasonably necessary and requested by the plan to make the determination. When the review is retrospective, the decision shall be communicated to the individual who received services, or to the individual’s designee, within 30 days of the receipt of information that is reasonably necessary to make this determination, and shall be communicated to the provider in a manner that is consistent with current law. For purposes of this section, retrospective reviews shall be for care rendered on or after January 1, 2000.

(2)When the enrollee’s condition is such that the enrollee faces an imminent and serious threat to the enrollee’s health, including, but not limited to, the potential loss of life, limb, or other major bodily function, or the normal timeframe for the decisionmaking process, as described in paragraph (1), would be detrimental to the enrollee’s life or health or could jeopardize the enrollee’s ability to regain maximum function, decisions to approve, modify, or deny requests by providers prior to, or concurrent with, the provision of health care services to enrollees, shall be made in a timely fashion appropriate for the nature of the enrollee’s condition, not to exceed 72 hours or, if shorter, the period of time required under Section 2719 of the federal Public Health Service Act (42 U.S.C. Sec. 300gg-19) and any subsequent rules or regulations issued thereunder, after the plan’s receipt of the information reasonably necessary and requested by the plan to make the determination. Nothing in this section shall be construed to alter the requirements of subdivision (b) of Section 1371.4. Notwithstanding Section 1371.4, the requirements of this division shall be applicable to all health plans and other entities conducting utilization review or utilization management.

(3)Decisions to approve, modify, or deny requests by providers for authorization prior to, or concurrent with, the provision of health care services to enrollees shall be communicated to the requesting provider within 24 hours of the decision. Except for concurrent review decisions pertaining to care that is underway, which shall be communicated to the enrollee’s treating provider within 24 hours, decisions resulting in denial, delay, or modification of all or part of the requested health care service shall be communicated to the enrollee in writing within two business days of the decision. In the case of concurrent review, care shall not be discontinued until the enrollee’s treating provider has been notified of the plan’s decision and a care plan has been agreed upon by the treating provider that is appropriate for the medical needs of that patient.

(4)Communications regarding decisions to approve requests by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees shall specify the specific health care service approved. Responses regarding decisions to deny, delay, or modify health care services requested by providers prior to, retrospectively, or concurrent with the provision of health care services to enrollees shall be communicated to the enrollee in writing, and to providers initially by telephone or facsimile, except with regard to decisions rendered retrospectively, and then in writing, and shall include a clear and concise explanation of the reasons for the plan’s decision, a description of the criteria or guidelines used, and the clinical reasons for the decisions regarding medical necessity. Any written communication to a physician or other health care provider of a denial, delay, or modification of a request shall include the name and telephone number of the health care professional responsible for the denial, delay, or modification. The telephone number provided shall be a direct number or an extension, to allow the physician or health care provider easily to contact the professional responsible for the denial, delay, or modification. Responses shall also include information as to how the enrollee may file a grievance with the plan pursuant to Section 1368, and in the case of Medi-Cal enrollees, shall explain how to request an administrative hearing and aid paid pending under Sections 51014.1 and 51014.2 of Title 22 of the California Code of Regulations.

(5)If the health care service plan cannot make a decision to approve, modify, or deny the request for authorization within the timeframes specified in paragraph (1) or (2) because the plan is not in receipt of all of the information reasonably necessary and requested, or because the plan requires consultation by an expert reviewer, or because the plan has asked that an additional examination or test be performed upon the enrollee, provided the examination or test is reasonable and consistent with good medical practice, the plan shall, immediately upon the expiration of the timeframe specified in paragraph (1) or (2) or as soon as the plan becomes aware that it will not meet the timeframe, whichever occurs first, notify the provider and the enrollee, in writing, that the plan cannot make a decision to approve, modify, or deny the request for authorization within the required timeframe, and specify the information requested but not received, or the expert reviewer to be consulted, or the additional examinations or tests required. The plan shall also notify the provider and enrollee of the anticipated date on which a decision may be rendered. Upon receipt of all information reasonably necessary and requested by the plan, the plan shall approve, modify, or deny the request for authorization within the timeframes specified in paragraph (1) or (2), whichever applies.

(6)If the director determines that a health care service plan has failed to meet any of the timeframes in this section, or has failed to meet any other requirement of this section, the director may assess, by order, administrative penalties for each failure. A proceeding for the issuance of an order assessing administrative penalties shall be subject to appropriate notice to, and an opportunity for a hearing with regard to, the person affected, in accordance with subdivision (a) of Section 1397. The administrative penalties shall not be deemed an exclusive remedy for the director. These penalties shall be paid to the Managed Care Administrative Fines and Penalties Fund and shall be used for the purposes specified in Section 1341.45.

(i)A health care service plan subject to this section shall maintain telephone access for providers to request authorization for health care services.

(j)A health care service plan subject to this section that reviews requests by providers prior to, retrospectively, or concurrent with, the provision of health care services to enrollees shall establish, as part of the quality assurance program required by Section 1370, a process by which the plan’s compliance with this section is assessed and evaluated. The process shall include provisions for evaluation of complaints, assessment of trends, implementation of actions to correct identified problems, mechanisms to communicate actions and results to the appropriate health plan employees and contracting providers, and provisions for evaluation of any corrective action plan and measurements of performance.

(k)The director shall review a health care service plan’s compliance with this section as part of its periodic onsite medical survey of each plan undertaken pursuant to Section 1380, and shall include a discussion of compliance with this section as part of its report issued pursuant to that section.

(l)This section shall not apply to decisions made for the care or treatment of the sick who depend upon prayer or spiritual means for healing in the practice of religion as set forth in subdivision (a) of Section 1270.

(m)Nothing in this section shall cause a health care service plan to be defined as a health care provider for purposes of any provision of law, including, but not limited to, Section 6146 of the Business and Professions Code, Sections 3333.1 and 3333.2 of the Civil Code, and Sections 340.5, 364, 425.13, 667.7, and 1295 of the Code of Civil Procedure.