Health care coverage: essential health benefits.

Commencing January 1, 2014, existing law, the federal Patient Protection and Affordable Care Act (PPACA) , requires a health insurance issuer that offers coverage in the small group or individual market to ensure that such coverage includes the essential health benefits package, as defined. PPACA requires each state to, by January 1, 2014, establish an American Health Benefit Exchange that facilitates the purchase of qualified health plans by qualified individuals and qualified small employers. PPACA defines a qualified health plan as a plan that, among other requirements, provides an essential health benefits package. Existing state law creates the California Health Benefit Exchange (the Exchange) to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers by January 1, 2014. 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 requires health care service plan contracts to cover various benefits. This bill would require an individual or small group health care service plan contract issued, amended, or renewed on or after January 1, 2014, to cover essential health benefits, which would be defined to include the health benefits covered by particular benchmark plans. The bill would prohibit treatment limits imposed on these benefits from exceeding the corresponding limits imposed by the benchmark plans and would generally prohibit a plan from making substitutions of the benefits required to be covered. The bill would specify that these provisions apply regardless of whether the contract is offered inside or outside the Exchange but would provide that they do not apply to grandfathered plans, specialized plans, or Medicare supplement plans, as specified. The bill would prohibit a health care service plan from issuing, delivering, renewing, offering, selling, or marketing a plan contract as compliant with the federal essential health benefits requirement satisfies the bill's requirements. The bill would authorize the Department of Managed Health Care to adopt emergency regulations implementing these provisions until March 1, 2016, and would enact other related provisions. These provisions would only be implemented to the extent essential health benefits are required pursuant to PPACA. The bill would provide that it shall become operative only if SB 951 is also enacted. Because a willful violation of the bill's provisions with respect 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.