2007 California Health and Safety Code Article 11.5. Individual Access To Contracts For Health Care Services

CA Codes (hsc:1399.801-1399.818)

1399.801.  As used in this article:
   (a) "Creditable coverage" means:
   (1) Any individual or group policy, contract, or program that is
written or administered by a disability insurer, health care service
plan, fraternal benefits society, self-insured employer plan, or any
other entity, in this state or elsewhere, and that arranges or
provides medical, hospital, and surgical coverage not designed to
supplement other plans.  The term includes continuation or conversion
coverage but does not include accident only, credit, disability
income, Medicare supplement, long-term care, dental, vision, coverage
issued as a supplement to liability insurance, insurance arising out
of a workers' compensation or similar law, automobile medical
payment insurance, or insurance under which benefits are payable with
or without regard to fault and that is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance.
   (2) The federal Medicare program pursuant to Title XVIII of the
Social Security Act.
   (3) The medicaid program pursuant to Title XIX of the Social
Security Act.
   (4) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (5) 10 U.S.C.A. Chapter 55 (commencing with Section 1071)
(CHAMPUS).
   (6) A medical care program of the Indian Health Service or of a
tribal organization.
   (7) A state health benefits risk pool.
   (8) A health plan offered under 5 U.S.C.A. Chapter 89 (commencing
with Section 8901) (FEHBP).
   (9) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(l) of the Public Health Service Act,
as amended by Public Law 104-191, the Health Insurance Portability
and Accountability Act of 1996.
   (10) A health benefit plan under 22 U.S.C.A. 2504(e) of the Peace
Corps Act.
   (b) "Dependent" means the spouse or child of an eligible
individual or other individual applying for coverage, subject to
applicable terms of the health care plan contract covering the
eligible person.
   (c) "Federally eligible defined individual" means an individual
who as of the date on which the individual seeks coverage under this
part, (1) has 18 or more months of creditable coverage, and whose
most recent prior creditable coverage was under a group health plan,
a federal governmental plan maintained for federal employees, or a
governmental plan or church plan as defined in the federal Employee
Retirement Income Security Act of 1974 (29 U.S.C. Sec. 1002), (2) is
not eligible for coverage under a group health plan, Medicare, or
Medi-Cal, and has no other health insurance coverage, (3) was not
terminated from his or her most recent creditable coverage due to
nonpayment of premiums or fraud, and (4) if offered continuation
coverage under COBRA or Cal-COBRA, had elected and exhausted this
coverage.
   (d) "In force business" means an existing health benefit plan
contract issued by the plan to a federally eligible defined
individual.
   (e) "New business" means a health care service plan contract
issued to an eligible individual that is not the plan's in force
business.
   (f) "Preexisting condition provision" means a contract provision
that excludes coverage for charges and expenses incurred during a
specified period following the eligible individual's effective date,
as to a condition for which medical advice, diagnosis, and care of
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.



1399.802.  Every health care service plan offering plan contracts to
individuals shall, in addition to complying with the provisions of
this chapter and the rules adopted thereunder, comply with the
provisions of this article.


1399.803.  Nothing in this article shall be construed to preclude
the application of this chapter to either of the following:  (a) an
association, trust, or other organization acting as a health care
service plan as defined under Section 1345, or (b) an association,
trust, multiple employer welfare arrangement, or other organization
or person presenting information regarding a health care service plan
to persons who may be interested in subscribing or enrolling in the
plan.


1399.804.  (a) Commencing January 1, 2001, a plan shall fairly and
affirmatively offer, market, and sell the health care service plan
contracts described in subdivision (d) of Section 1366.35 that are
sold to individuals or to associations that include individuals to
all federally eligible defined individuals in each service area in
which the plan provides or arranges for the provision of health care
services.  Each plan shall make available to each federally eligible
defined individual the identified health care service plan contracts
which the plan offers and sells to individuals or to associations
that include individuals.
   (b) The plan may not reject an application from a federally
eligible defined individual for a health care service plan contract
under the following circumstances:
   (1) The federally eligible defined individual as defined by
subdivision (c) of Section 1399.801 agrees to make the required
premium payments.
   (2) The federally eligible defined individual, and his or her
dependents who are to be covered by the plan contract, work or reside
in the service area in which the plan provides or otherwise arranges
for the provision of health care services.
   (c) No plan or solicitor shall, directly or indirectly, encourage
or direct federally eligible defined individuals to refrain from
filing an application for coverage with a plan because of health
status, claims experience, industry, occupation, receipt of health
care, genetic information, evidence of insurability, including
conditions arising out of acts of domestic violence, disability, or
geographic location provided that it is within the plan's approved
service area.
   (d) No plan shall, directly or indirectly, enter into any
contract, agreement, or arrangement with a solicitor that provides
for or results in the compensation paid to a solicitor for the sale
of a health care service plan contract to be varied because of health
status, claims experience, industry, occupation, receipt of health
care, genetic information, evidence of insurability, including
conditions arising out of acts of domestic violence, disability, or
geographic location of the individual.
   (e) Each plan shall comply with the requirements of Section
1374.3.



1399.805.  (a) (1) After the federally eligible defined individual
submits a completed application form for a plan contract, the plan
shall, within 30 days, notify the individual of the individual's
actual premium charges for that plan contract, unless the plan has
provided notice of the premium charge prior to the application being
filed. In no case shall the premium charged for any health care
service plan contract identified in subdivision (d) of Section
1366.35 exceed the following amounts:
   (A) For health care service plan contracts that offer services
through a preferred provider arrangement, the average premium paid by
a subscriber of the Major Risk Medical Insurance Program who is of
the same age and resides in the same geographic area as the federally
eligible defined individual.  However, for federally qualified
individuals who are between the ages of 60 and 64, inclusive, the
premium shall not exceed the average premium paid by a subscriber of
the Major Risk Medical Insurance Program who is 59 years of age and
resides in the same geographic area as the federally eligible defined
individual.
   (B) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that do not offer services through
a preferred provider arrangement, 170 percent of the standard
premium charged to an individual who is of the same age and resides
in the same geographic area as the federally eligible defined
individual.  However, for federally qualified individuals who are
between the ages of 60 and 64, inclusive, the premium shall not
exceed 170 percent of the standard premium charged to an individual
who is 59 years of age and resides in the same geographic area as the
federally eligible defined individual. The individual shall have 30
days in which to exercise the right to buy coverage at the quoted
premium rates.
   (2) A plan may adjust the premium based on family size, not to
exceed the following amounts:
   (A) For health care service plans that offer services through a
preferred provider arrangement, the average of the Major Risk Medical
Insurance Program rate for families of the same size that reside in
the same geographic area as the federally eligible defined
individual.
   (B) For health care service plans identified in subdivision (d) of
Section 1366.35 that do not offer services through a preferred
provider  arrangement, 170 percent of the standard premium charged to
a family that is of the same size and resides in the same geographic
area as the federally eligible defined individual.
   (b) When a federally eligible defined individual submits a premium
payment, based on the quoted premium charges, and that payment is
delivered or postmarked, whichever occurs earlier, within the first
15 days of the month, coverage shall begin no later than the first
day of the following month.  When that payment is neither delivered
or postmarked until after the 15th day of a month, coverage shall
become effective no later than the first day of the second month
following delivery or postmark of the payment.
   (c) During the first 30 days after the effective date of the plan
contract, the individual shall have the option of changing coverage
to a different plan contract offered by the same health care service
plan.  If the individual notified the plan of the change within the
first 15 days of a month, coverage under the new plan contract shall
become effective no later than the first day of the following month.
If an enrolled individual notified the plan of the change after the
15th day of a month, coverage under the new plan contract shall
become effective no later than the first day of the second month
following notification.



1399.806.  A plan may not exclude any federally eligible defined
individual, or his or her dependents, who would otherwise be entitled
to health care services on the basis of an actual or expected health
condition of that individual or dependent.  No plan contract may
limit or exclude coverage for a specific federally eligible defined
individual, or his or her dependents, by type of illness, treatment,
medical condition, or accident.



1399.809.  The director may require a plan to discontinue the
offering of contracts or the acceptance of applications from any
individual upon a determination by the director that the plan does
not have sufficient financial viability, organization, and
administrative capacity to assure the delivery of health care
services to its enrollees.  In determining whether the conditions of
this section have been met, the director shall consider, but not be
limited to, the plan's compliance with the requirements of Section
1367, Article 6 (commencing with Section 1375), and the rules adopted
thereunder.



1399.810.  All health care service plan contracts offered to a
federally eligible defined individual shall be renewable with respect
to the individual and dependents at the option of the contractholder
except in cases of:
   (a) Nonpayment of the required premiums.
   (b) Fraud or misrepresentation by the contractholder.
   (c) The plan ceases to provide or arrange for the provision of
health care services for individual health care service plan
contracts in this state, provided, however, that the following
conditions are satisfied:
   (1) Notice of the decision to cease new or existing individual
health benefit plans in this state is provided to the director and to
the contractholder.
   (2) Individual health care service plan contracts subject to this
chapter shall not be canceled for 180 days after the date of the
notice required under paragraph (1) and for that business of a plan
that remains in force, any plan that ceases to offer for sale new
individual health care service plan contracts shall continue to be
governed by this article with respect to business conducted under
this article.
   (3) A plan that ceases to write new individual business in this
state after January 1, 2001, shall be prohibited from offering for
sale new individual health care service plan contracts in this state
for a period of three years from the date of the notice to the
director.
   (d) When the plan withdraws a health care service plan contract
from the individual market, provided that the plan makes available to
eligible individuals all plan contracts that it makes available to
new individual business, and provided that the premium for the new
plan contract complies with the renewal increase requirements set
forth in Section 1399.811.



1399.811.  Premiums for contracts offered, delivered, amended, or
renewed by plans on or after January 1, 2001, shall be subject to the
following requirements:
   (a) The premium for new business for a federally eligible defined
individual shall not exceed the following amounts:
   (1) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that offer services through a
preferred provider arrangement, the average premium paid by a
subscriber of the Major Risk Medical Insurance Program who is of the
same age and resides in the same geographic area as the federally
eligible defined individual.  However, for federally qualified
individuals who are between the ages of 60 to 64 years, inclusive,
the premium shall not exceed the average premium paid by a subscriber
of the Major Risk Medical Insurance Program who is 59 years of age
and resides in the same geographic area as the federally eligible
defined individual.
   (2) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that do not offer services through
a preferred provider arrangement, 170 percent of the standard
premium charged to an individual who is of the same age and resides
in the same geographic area as the federally eligible defined
individual. However, for federally qualified individuals who are
between the ages of 60 to 64 years, inclusive, the premium shall not
exceed 170 percent of the standard premium charged to an individual
who is 59 years of age and resides in the same geographic area as the
federally eligible defined individual.
   (b) The premium for in force business for a federally eligible
defined individual shall not exceed the following amounts:
   (1) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that offer services through a
preferred provider arrangement, the average premium paid by a
subscriber of the Major Risk Medical Insurance Program who is of the
same age and resides in the same geographic area as the federally
eligible defined individual.  However, for federally qualified
individuals who are between the ages of 60 and 64 years, inclusive,
the premium shall not exceed the average premium paid by a subscriber
of the Major Risk Medical Insurance Program who is 59 years of age
and resides in the same geographic area as the federally eligible
defined individual.
   (2) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that do not offer services through
a preferred provider arrangement, 170 percent of the standard
premium charged to an individual who is of the same age and resides
in the same geographic area as the federally eligible defined
individual. However, for federally qualified individuals who are
between the ages of 60 and 64 years, inclusive, the premium shall not
exceed 170 percent of the standard premium charged to an individual
who is 59 years of age and resides in the same geographic area as the
federally eligible defined individual. The premium effective on
January 1, 2001, shall apply to in force business at the earlier of
either the time of renewal or July 1, 2001.
   (c) The premium applied to a federally eligible defined individual
may not increase by more than the following amounts:
   (1) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that offer services through a
preferred provider arrangement, the average increase in the premiums
charged to a subscriber of the Major Risk Medical Insurance Program
who is of the same age and resides in the same geographic area as the
federally eligible defined individual.
   (2) For health care service plan contracts identified in
subdivision (d) of Section 1366.35 that do not offer services through
a preferred provider arrangement, the increase in premiums charged
to a nonfederally qualified individual who is of the same age and
resides in the same geographic area as the federally defined eligible
individual.  The premium for an eligible individual may not be
modified more frequently than every 12 months.
   (3) For a contract that a plan has discontinued offering, the
premium applied to the first rating period of the new contract that
the federally eligible defined individual elects to purchase shall be
no greater than the premium applied in the prior rating period to
the discontinued contract.



1399.812.  Plans shall apply premiums consistently with respect to
all federally eligible defined individuals who apply for coverage.



1399.813.  In connection with the offering for sale of any plan
contract to an individual, each plan shall make a reasonable
disclosure, as part of its solicitation and sales materials, of all
individual contracts.


1399.814.  Nothing in this article shall be construed to require a
health benefit plan to offer a contract to an individual if the plan
does not otherwise offer contracts to individuals.



1399.815.  (a) At least 20 business days prior to renewing or
amending a plan contract subject to this article, or at least 20
business days prior to the initial offering of a plan contract
subject to this article, a plan shall file a notice of an amendment
with the director in accordance with the provisions of Section 1352.
The notice of an amendment shall include a statement certifying that
the plan is in compliance with subdivision (a) of Section 1399.805
and with Section 1399.811.  Any action by the director, as permitted
under Section 1352, to disapprove, suspend, or postpone the plan's
use of a plan contract shall be in writing, specifying the reasons
the plan contract does not comply with the requirements of this
chapter.
   (b) Prior to making any changes in the premium, the plan shall
file an amendment in accordance with the provisions of Section 1352,
and shall include a statement certifying the plan is in compliance
with subdivision (a) of Section 1399.805 and with Section 1399.811.
All other changes to a plan contract previously filed with the
director pursuant to subdivision (a) shall be filed as an amendment
in accordance with the provisions of Section 1352, unless the change
otherwise would require the filing of a material modification.



1399.816.  Carriers and health care service plans that offer
contracts to individuals may elect to establish a mechanism or method
to share in the financing of high-risk individuals.  This mechanism
or method shall be established through a committee of all carriers
and health care service plans offering coverage to individuals by
July 1, 2002, and shall be implemented by January 1, 2003.  If
carriers and health care service plans wish to establish a
risk-sharing mechanism but cannot agree on the terms and conditions
of such an agreement, the Managed Risk Medical Insurance Board shall
develop a risk-sharing mechanism or method by January 1, 2003, and it
shall be implemented by July 1, 2003.



1399.817.  The director may issue regulations that are necessary to
carry out the purposes of this article.  Any rules and regulations
adopted pursuant to this article may be adopted as emergency
regulations in accordance with Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code.
Until December 31, 2001, the adoption of these regulations shall be
deemed an emergency and necessary for the immediate preservation of
the public peace, health and safety, or general welfare.  The
regulations shall be enforced by the director.



1399.818.  This article shall apply to health care service plan
contracts offered, delivered, amended, or renewed on or after January
1, 2001.