Revised Legislative Update: Key Bills Pass; Off to 2nd Half of the Legislative Process

Thursday, May 29, 2014

*        Important health bills advance, including ones sponsored by Health Access California, and head toward consideration in policy committees in the second legislative house in June.

*       Bills passed include those to help consumers once they get coverage, with network adequacy and timely access to doctors and specialists (SB964), continuity of care (SB1100), avoiding junk coverage (AB2088) and putting in place rate review (SB1182) for large employers, prescription drug cost sharing (AB1917), tracking out-of-pocket expenses (SB1176), preventing Medi-Cal estate recovery (SB1124), and more. Floor votes scheduled for next week.

        Consumer advocates mobilize on these bills to continue momentum of health reform, ensure coverage is meaningful, and health system works.

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In the last two days, the California legislature has been busy debating and voting on hundrdeds of bills, including several to provide new consumer protections and oversight to benefit health care consumers. In both the Senate and the Assembly, key bills were passed out of the first legislative house earlier this week, pushing past the halfway point in the legislative process.

Many key health bills passed the Senate on Tuesday, including those that would help insured consumers ensure timely access to care by ensuring provider networks are adequate (SB964-Ed Hernandez); provide continuity of care when switching plans (SB1100-Ed Hernandez); help track out-of-pocket expenses (SB1176-Steinberg), and avoid Medi-Cal estate recovery (SB1124-Ed Hernandez). Just yesterday, the Assembly passed measures to help consumers avoid junk coverage when working at large employers (AB2088-Roger Hernandez) and better manage prescription drug cost sharing (AB1917-Gordon).

Below is a list, including those bills sponsored by Health Access California, the statewide health care consumer advocacy coalition, and other bills supported by consumer groups on health issues. Bills needed to pass the first legislative house by the end of this week, and having passed that hurdle, can proceed to policy committees in the second legislative house for next half of the legislative process.

Some of the official vote totals may change: these were the votes at the time of passage and members can add on later in the Assembly:

Insurance Consumer Protections

NETWORK ADEQUACY OVERSIGHT OF HEALTH PLANS: SB964 (Ed Hernandez) requires the Department of Managed Health Care (DMHC) to conduct surveys of health plans for timely access and network adequacy to be done more frequently, and by book-of-business, separately for Medi-Cal managed care and Covered California plans, to ensure access to care for patients in those programs. It also requires separate surveys until five years after implementation of major Medi-Cal managed care transitions, including those of Healthy Families, seniors and persons with disabilities, dual eligibles (both Medicare and Medi-Cal) and the rural transition. Sponsored by Health Access California. PASSED SENATE FLOOR 22-10

PRESCRIPTION DRUG COST SHARING: AB1917 (Gordon) spreads out the cost of expensive prescriptions over a year, to better help those with HIV/AIDS, cancer, MS, and other diseases manage out-of-pocket expenses. Consumers would still have the annual out of pocket limit of no more than $6,350 for an individual or $12,700 for a family under the ACA, but the cost of any one drug can’t be more than 1/12 of the annual limit. This means multi-tier drug formularies in which some high-priced drugs are on a tier with 20% co-insurance won’t burden patients all at once; a patient might still end up owing the annual out of pocket limit but at least the cost will be spread out over a year. Sponsored by Health Access California. PASSED ASSEMBLY FLOOR 48-25

JUNK INSURANCE FOR LARGE EMPLOYERS: AB2088 (Roger Hernandez), while not banning limited benefit plans, makes them supplemental to comprehensive coverage. While California’s Insurance Code allows the sale of “insurance” that provides very limited benefits with a minimum actuarial value of less than 60%, such as cancer-only policies and hospital fixed amount indemnity policies that pay $100 or $200 a day when someone is hospitalized, current California law allows it only as supplemental to essential health benefits in the individual and small employer markets. This bill extends this consumer protection to large employer coverage, closing a loophole for employers to possibly avoid compliance with the full intent of the ACA. Sponsored by Health Access California. PASSED ASSEMBLY FLOOR 50-25

CONTINUITY OF CARE: SB1100 (Ed Hernandez) would provide continuity of care protections for consumers who change their individual coverage—something that was not possible for many until the ACA. While Californians with employment-based coverage now have the right to continuity of care if in the midst of treatment or had a serious condition when their coverage changed, this bill extends this protection to those with individual coverage including in Covered California. Sponsored by Health Access California. PASSED SENATE FLOOR 25-10

SB1176(Steinberg) makes the health plan or insurer responsible for tracking out-of-pocket costs for in-network providers, and reimbursing the consumer when they exceed their out-of-pocket limit. PASSED SENATE FLOOR 24-11

SB959 (Ed Hernandez) is the clean-up bill for the individual and small group market reform legislation to implement the ACA enacted in 2012 and 2013. PASSED SENATE FLOOR 24-7

SB20(Ed Hernandez) would modify the individual market open enrollment period for the 2015 policy year to be November 15, 2014-February 15, 2015, so that it is consistent with the dates announced by the federal government exchange. PASSED ASSEMBLY FLOOR 56-20

SB1034 (Monning) would delete 60 day waiting period for California insurance. California law would not permit any waiting period as a result of a pre-existing condition. Federal law would permit employers to impose a waiting period of as much as 90 days for workers and dependents. PASSED SENATE 35-0; IN ASSEMBLY HEALTH

AB2533(Ammiano) would seek to ensure timely access to necessary care at in-network cost sharing. PASSED ASSEMBLY 44-28

Cost/Quality Transparency

SB1182 (Leno) would implement large group rate review for rate increases in excess of 5%. It also provides claims data or other detailed data to large purchasers. PASSED SENATE FLOOR 21-12 

AB1558 (Roger Hernandez) would provide claims data to the University of California so that UC can do studies on cost and quality. PASSED ASSEMBLY FLOOR 72-0 

AB1962 (Skinner) would make transparent what dental-only plans spend, as a percentage of premium, on patient care. It requires specialized dental-only plans to disclose a “medical loss ratios” as for medical coverage. The bill is sponsored by the California Dental Association. PASSED ASSEMBLY FLOOR 76-0

Hospital Oversight and Consumer Protections.

SB1094 (Lara) amends existing law on Attorney General oversight of nonprofit hospital mergers and acquisitions. It extends the review period from 60 days to 90 days. It also gives the Attorney General authority to enforce conditions of hospital transactions. This bill is sponsored by the Attorney General. PASSED SENATE FLOOR 21-15

SB1276 (Ed Hernandez) updates the Hospital Fair Pricing law (which Health Access California sponsored in 2006) by: defining a reasonable payment plan as monthly payments that are no more than 10% of income after essential living expenses; allowing underinsured individuals with high health costs (over 10% of income) to receive the hospital fair pricing discount even if they receive a discounted rate on their cost sharing from their health plan or insurer; adding Covered California as a source of coverage; and requiring the debt collection policy to apply to any affiliates or subsidiaries or external collection agency used by the hospital. It is being sponsored by Western Center on Law and Poverty based on their experience assisting consumers. PASSED SENATE FLOOR 23-10


SB1124 (Hernandez) limits Medi-Cal estate recovery. California is one of only ten states that impose estate recovery on more than long term care services, where the state, for those over 55, recovers the cost of care from the estate of an individual after death. This has discouraged some from signing up for Medi-Cal coverage. Co-sponsored by Western Center on Law and Poverty (WCLP) and California Advocates for Nursing Home Reform. PASSED SENATE FLOOR 30-5

AB2325 (Speaker Perez) would create a Medi-Cal medical interpreter program (CommuniCal) to provide and reimburse for medical interpretation for Medi-Cal patients that are low in English proficiency. A version of this bill was vetoed last year: this is a re-introduction of that measure. PASSED ASSEMBLY FLOOR 53-25


SB912 (Mitchell) would eliminate the sunset on the current requirement that vending machines in state buildings include 35% healthy food and drinks. Sponsored by California Pan-Ethnic Health Network. PASSED SENATE 28-6; IN ASSEMBLY BUSINESS, PROFESSIONS & CONSUMER PROTECTIONS