Health care coverage: investments: disclosure.

The bill now explicitly covers 'carrier nonprofit health care service plan' participating in the Exchange, expanding coverage beyond just insurance carriers to include nonprofit health care service plans (such as HMOs) that participate in Covered California.

Entire Article 10.9 (Sections 1399.67-1399.68) added to the Health and Safety Code for health care service plan investment transparency was removed, along with its separate civil penalty and noncompliance posting requirements enforced by the Department of Managed Health Care.

Entire Chapter 7.5 (Sections 10609.1-10609.2) added to the Insurance Code for health insurer investment transparency was removed, along with its separate civil penalty and noncompliance posting requirements enforced by the Department of Insurance.

Penalty assessment now appears to be split: the Exchange assesses administrative penalties against carriers, while the Department of Managed Health Care assesses penalties against plans, both within the single Government Code section rather than through separate code provisions.

State-mandated local program designation changed from 'yes' to 'no,' meaning the bill no longer triggers state reimbursement obligations to local agencies or school districts under Article XIIIB of the California Constitution.

The definition of 'material investment holdings' was updated to reference 'carrier plan' and corrected grammar from 'are a direct or indirect ownership interest' to 'that are a direct or indirect ownership interest.'

Removed the 'nonprofit integrated' qualifier from health care service plans subject to disclosure requirements. The bill now applies to ALL health care service plans regulated by the Department of Managed Health Care, not just nonprofit integrated ones.

The bill's title and legislative digest were updated from 'Nonprofit integrated health care service plans: Health care coverage: investments: disclosure' to simply 'Health care coverage: investments: disclosure,' reflecting the broader applicability.

Added new Government Code Section 100524 requiring carriers participating in Covered California (the Exchange) to annually disclose their material investment holdings to the Exchange, including their 25 largest investment holdings regardless of reporting structure and a copy of their Form 5500 filed with the US Department of Labor.

Added an administrative penalty of $1,000 per day (after a 30-day grace period) for Exchange-participating carriers that fail to comply with disclosure requirements, assessed by the Exchange itself rather than a state department.

State-mandated local program designation changed from 'yes' to 'no' in the Senate amendment, indicating the bill no longer triggers state reimbursement obligations to local agencies.

Added a new Chapter 7.5 (Section 10609.1 and 10609.2) to the Insurance Code requiring health insurers regulated by the Department of Insurance to annually disclose material investment holdings, with the same $1,000-per-day civil penalty and public posting requirements that apply to nonprofit integrated health care service plans.

Removed the amendment to Labor Code Section 1421 that would have required employers to keep email addresses of employees and covered workers for three years. This provision was unrelated to the bill's primary focus on health care investment transparency.

Legislative findings and the bill's title/digest were updated to reference health insurers alongside nonprofit integrated health care service plans, reflecting the expanded applicability to both the Department of Managed Health Care and the Department of Insurance.

Added a new definition of 'material investment holding' in both the Health and Safety Code (Section 1399.67(d)) and Insurance Code (Section 10609.1(d)), defining it as a direct or indirect ownership interest, financial stake, or beneficial interest that a reasonable person would consider important in evaluating the entity's financial position, priorities, or potential conflicts of interest.

The state-mandated local program designation changed from 'no' to 'yes,' meaning the bill now imposes costs on local agencies or school districts that may require reimbursement under Article XIII B of the California Constitution.

The bill now covers nonprofit integrated health care service plans regulated by the Department of Managed Health Care, in addition to its original focus on property service worker employment records. A new coauthor (Assembly Member Mark Gonzalez) was added.

State-mandated local program designation changed from 'no' to 'yes' because the new provisions create criminal penalties (a willful violation of the Knox-Keene Act is a crime).

New Section 1399.67 requires nonprofit integrated health care service plans to annually disclose material investment holdings to the Department of Managed Health Care. The initial disclosure must cover five calendar years prior to January 1, 2027, and subsequent annual disclosures are due by July 1 each year starting July 1, 2027.

The Department of Managed Health Care must prominently display and make publicly accessible all investment disclosures on its internet website.

New Section 1399.68 imposes a civil penalty of $1,000 per day after a 30-day grace period for plans that fail to comply with disclosure requirements. Noncompliant plans must post a notice on their own website, and the Department of Managed Health Care and Covered California must also prominently post the plan's noncompliance status until compliance is achieved.

A new legislative findings section (Section 1) establishes the policy rationale: nonprofit plans receive public benefits through tax credits and program participation, Californians pay billions in premiums expecting funds to support patient care, and there is currently limited public visibility into how these plans invest their reserves.