Big news for health consumers! Last week, Governor Jerry Brown signed a number of key consumer protection bills, including AB 72 (Bonta, et. al.), which gives millions of California consumers the nation’s strongest protections against surprise out-of-network medical bills. The Governor also signed SB 908 (Hernandez) on unjustified rate increases and SB 1135 (Monning) on patients’ rights marking a momentous year for health consumer protections in California. These bills join SB 923 (Hernandez) to prevent mid-year cost-sharing increases which the Governor signed earlier this month.
AB 72 Ends Surprise Out-Of-Network Bills for In-Network Visits
After decades of legislative gridlock, two years of intense negotiations, and dozens of impacted patients telling their stories, Californians now have some of the strongest consumer protections in the nation against surprise medical bills. With his signature on AB 72, California now takes the most significant step of any state to protect patients from being hit with surprise medical bills, which can hit patients with hundreds or thousands of dollars in unexpected costs. This landmark law protects Californians from the financial calamity that often comes with unexpected out-of-network costs when going to an in-network hospital or other facility. This protection is particularly important to lower-income families who are newly insured under the ACA.
The Governor’s action affirms California’s leadership when it comes to protecting consumers in the health care market.
Ending the practice of surprise medical bills in California has been years in the making, with the first attempt to solve the problem dating back to the 1970s. After two years of intense focus on the issue by consumer advocates, insurers, and providers, AB 72 provides the strongest consumer protections against surprise medical bills in the nation while also paying out-of-network providers a fair rate. The new law, which takes effect on July 1, 2017, ensures consumers never get billed for more than their in-network cost-sharing, and includes safeguards against consumers having their credit adversely affected, wages garnished, or liens placed on their primary residence because of these surprise bills. At the same time, the law assures out-of-network doctors are paid at least a minimum payment of 125% of Medicare or average contracted rate, rather than 100% of Medicare as proposed in an earlier version of the legislation.
AB 72 was co-sponsored by Health Access California and the California Labor Federation. Read more about how this new law will help consumers in this new fact sheet.
SB 908 (Hernandez) Lets consumers know when their health plan is imposing an unreasonable rate increase
Governor Brown also signed important legislation notifying consumers of unreasonable premium rates as well as their right to timely access to care. Over one million Californians have unknowingly had to pay premiums that regulators deemed were unreasonable. With the signing of SB 908, consumers will now be alerted about these unjustified rates so they have time to shop for a more affordable plan.
SB 908 discourages unjustified health plan rate hikes and empowers consumers to make informed decisions about the coverage they are choosing. Current law only required the determination of an unreasonable rate to be posted on a state website where it was often difficult for the average consumer to know if they specifically were being overcharged. This new law ensures that Californians will not be in the dark if their rate has been deemed unjustified, and that they have the opportunity to shop around.
Taking effect on January 1, 2017, the new law takes two simple steps to make sure consumers know their rights. First, it requires notification to individual consumers and small business owners if California regulators have found a rate to be unreasonable or unjustified. Second, it requires that the information be given well enough ahead of an open enrollment period so that consumers have the opportunity to shop for a plan with rates that are reasonable and justified.
SB 1135 (Monning) Provides consumers with information about their rights to get timely access to care
Consumers will also now be informed of their rights to timely access to care and an interpreter if needed with the signing of SB 1135. The new law requires health plans and insurers to let consumers know about these rights when someone first enrolls in a health plan, including Medi-Cal plans, and when they renew each year. The information would also be provided in the Evidence of Coverage and in a health plan’s provider directory, internet website, and newsletters.
Consumers have a right to timely access to care and should not have to wait weeks or months for a doctor’s appointment. Unfortunately, most consumers don’t know they have these rights. This new law ensures that consumers receive this information so that they know what they ought to expect and demand of their health plans and providers.
This law will go into effect on January 1, 2017.VIEW THE FILE Legislation