2007 California Insurance Code Article 1. General Provisions

CA Codes (ins:10110-10127.18)

10110.  Every person has an insurable interest in the life and
health of:
   (a) Himself.
   (b) Any person on whom he depends wholly or in part for education
or support.
   (c) Any person under a legal obligation to him for the payment of
money or respecting property or services, of which death or illness
might delay or prevent the performance.
   (d) Any person upon whose life any estate or interest vested in
him depends.



10110.1.  (a) An insurable interest, with reference to life and
disability insurance, is an interest based upon a reasonable
expectation of pecuniary advantage through the continued life,
health, or bodily safety of another person and consequent loss by
reason of that person's death or disability or a substantial interest
engendered by love and affection in the case of individuals closely
related by blood or law.
   (b) An individual has an unlimited insurable interest in his or
her own life, health, and bodily safety and may lawfully take out a
policy of insurance on his or her own life, health, or bodily safety
and have the policy made payable to whomsoever he or she pleases,
regardless of whether the beneficiary designated has an insurable
interest.
   (c) Except as provided in Section 10110.4, an employer has an
insurable interest, as referred to in subdivision (a), in the life or
physical or mental ability of any of its directors, officers, or
employees or the directors, officers, or employees of any of its
subsidiaries or any other person whose death or physical or mental
disability might cause financial loss to the employer; or, pursuant
to any contractual arrangement with any shareholder concerning the
reacquisition of shares owned by the shareholder at the time of his
or her death or disability, on the life or physical or mental ability
of that shareholder for the purpose of carrying out the contractual
arrangement; or, pursuant to any contract obligating the employer as
part of compensation arrangements or pursuant to a contract
obligating the employer as guarantor or surety, on the life of the
principal obligor.  The trustee of an employer or trustee of a
pension, welfare benefit plan, or trust established by an employer
providing life, health, disability, retirement, or similar benefits
to employees and retired employees of the employer or its affiliates
and acting in a fiduciary capacity with respect to those employees,
retired employees, or their dependents or beneficiaries has an
insurable interest in the lives of employees and retired employees
for whom those benefits are to be provided.  The employer shall
obtain the written consent of the individual being insured.
   (d) An insurable interest shall be required to exist at the time
the contract of life or disability insurance becomes effective, but
need not exist at the time the loss occurs.
   (e) Any contract of life or disability insurance procured or
caused to be procured upon another individual is void unless the
person applying for the insurance has an insurable interest in the
individual insured at the time of the application.
   (f) Notwithstanding subdivisions (a), (d), and (e), a charitable
organization that meets the requirements of Section 214 or 23701d of
the Revenue and Taxation Code may effectuate life or disability
insurance on an insured who consents to the issuance of that
insurance.
   (g) This section shall not be interpreted to define all instances
in which an insurable interest exists.



10110.2.  An insurer shall be entitled to rely upon all statements,
declarations, and representations made by an applicant for insurance
relative to the insurable interest that the applicant has in the
insured, and no insurer shall incur any legal liability except as set
forth in the policy, by virtue of any untrue statements,
declarations, or representations so relied upon in good faith by the
insurer.



10110.3.  (a) An insurer may not issue an individual life insurance
policy to an applicant that insures the life of the applicant's
spouse unless the applicant's spouse has signed the policy
application or has otherwise been notified in advance of the issuance
of the policy.
   (b) This section shall apply to policies of individual life
insurance with face amounts exceeding fifty thousand dollars
(,000) that are issued on or after July 1, 2004.



10110.4.  (a) Except as allowed in subdivision (c), an insurer may
not issue or deliver a corporate-owned life insurance policy.
   (b) "Corporate-owned life insurance policy" means a life insurance
policy that is purchased by a California employer, that designates
the employer as the beneficiary of the policy, and that insures the
life of a California resident who is a current or former employee of
the employer.
   (c) This section does not apply to a policy insuring the life of a
current or former exempt employee.  An exempt employee is an
administrative, executive, or professional employee who is exempt
under Section 515 of the Labor Code and the regulations adopted
pursuant thereto.
   (d) Except as provided in subdivision (f), it is a violation of
public policy for a California employer to purchase or hold a
corporate-owned life insurance policy.
   (e) (1) A corporate-owned life insurance policy purchased on or
after the effective date of this section is void.
   (2) Except as provided in subdivision (f), a corporate-owned life
insurance policy purchased prior to the effective date of this
section shall become void on the next premium payment date on or
after the date five years from the effective date of this section,
but no later than January 1, 2010.
   (f) A corporate-owned life insurance policy purchased prior to the
effective date of this section that insures the life of a current or
former nonexempt employee shall continue in force after the
effective date of this section provided that no further premium
payments are made after the effective date of this section.  However,
an employer who has purchased and holds such a corporate-owned life
insurance policy shall disclose in writing to the current or former
nonexempt employee whose life is insured by the policy, within 90
days of the effective date of this section, all of the following
information:
   (1) The existence of the corporate-owned life insurance policy on
the life of the nonexempt employee.
   (2) The identity of the insurer under the policy.
   (3) The benefit amount under the policy, unless the full amount of
the benefit is used to defray the costs of nonexempt employee
benefits.
   (4) How benefits paid under the policy would be used.
   (5) The name of the beneficiary under the policy.
   (g) For a former employee, the disclosure requirements shall be
deemed satisfied if the employer mails the required information to
the former employee's last known address.



10110.5.  A policy or endorsement issued by an admitted life and
disability insurer may contain a provision for a waiver of premium
payments in the event of involuntary unemployment of the insured.
Insurers issuing policies or endorsements which contain that
provision shall establish any additional reserves and file any
additional financial reports that the commissioner may require.



10111.  In life or disability insurance, the only measure of
liability and damage is the sum or sums payable in the manner and at
the times as provided in the policy to the person entitled thereto.



10111.2.  (a) Under a policy of disability income insurance, as
defined in subdivision (i) of Section 799.01, payment of benefits to
the insured shall be made within 30 calendar days after the insurer
has received all information needed to determine liability for a
claim.  However, the 30-calendar-day period shall not include any
time during which the insurer is doing any of the following:
   (1) Awaiting a response for relevant medical information from a
health care provider.
   (2) Awaiting a response from the claimant to a request for
additional relevant information.
   (3) Investigating possible fraud that has been reported to the
department's Fraud Division in compliance with subdivision (a) of
Section 1872.4.
   (b) If the insurer has not received all information needed to
determine liability for a claim within 30 calendar days after receipt
of the claim, the insurer shall notify the insured in writing and
include a written list of all information it reasonably needs to
determine liability for the claim.  In that event, the
30-calendar-day period set out in subdivision (a) shall commence when
the insured has provided to the insurer all information in that
notification.  If no notice is sent by the insurer within 30 calendar
days after the claim is filed by the insured, interest shall begin
to accrue on the payment of benefits on the 31st calendar day after
receipt of the claim, at the rate of 10 percent per year.
   (c) When the insurer has received all information needed to
determine liability for a claim, and the insurer determines that
liability exists and fails to make payment of benefits to the insured
within 30 calendar days after the insurer has received that
information, any delayed payment shall bear interest, beginning the
31st calendar day, at the rate of 10 percent per year.  Liability
shall, in all cases, be determined by the insurer within 30 calendar
days of receiving all information set out in the insurer's written
notification to the insured.
   (d) Nothing in this section is intended to restrict any other
remedies available to an insured by statute or any other law.



10111.5.  An insurer shall not be liable for payments claimed under
an individual or group policy of life insurance if the duty to make
those payments depends upon a factual determination of whether the
death of the insured was an accident or a suicide and that fact
cannot be established without an autopsy and the autopsy is
prohibited under Section 27491.43 of the Government Code.  Insurers
refusing or delaying payments in those circumstances in good faith
shall not be liable for exemplary or punitive damages.



10111.7.  (a) An insurer shall not deny or refuse to accept an
application for life insurance, or refuse to insure, refuse to renew,
cancel, restrict, or otherwise terminate a policy of life insurance,
or charge a different rate for the same life insurance coverage,
based solely upon the applicant's or insured's past or future lawful
travel destinations.
   (b) Nothing in this section shall prohibit an insurer from
excluding or limiting coverage under a life insurance policy, or
refusing to offer life insurance, based upon lawful travel, or from
charging a different rate for that coverage, when that action is
based upon sound actuarial principles or is related to actual and
reasonably expected experience.


10112.  Subject to Section 2459 of the Probate Code, in respect to
life or disability insurance, or annuity contracts (except as
provided in Sections 2500 to 2507, inclusive, of the Probate Code and
Section 3500 of the Probate Code and Chapter 4 (commencing with
Section 3600) of Part 8 of Division 4 of the Probate Code),
heretofore or hereafter issued to or upon the life of any person not
of the full age of 18 years for the benefit of such minor or for the
benefit of the father, mother, husband, wife, child, brother, or
sister, of such minor, or issued to such minor, subject to written
consent of a parent or guardian, upon the life of any person in whom
such minor has an insurable interest for the benefit of himself or
such minor's father, mother, husband, wife, child, brother or sister,
such minor shall not, by reason only of such minority, be deemed
incompetent to contract for such insurance or annuity, or for the
surrender thereof, or to exercise all contractual rights thereunder,
or, subject to approval of a parent or guardian, to give a valid
discharge for any benefit accruing or for any money payable
thereunder; provided, that all such contracts made by a minor under
the age of 16 years, as determined by the nearest birthday, shall
have the written consent of a parent or guardian, and that the
exercise of all contractual rights under such contracts, or the
surrender thereof, or the giving of a valid discharge for any benefit
accruing or money payable thereunder, in the case of a minor under
the age of 16 years, as determined by the nearest birthday, shall
have the written consent of a parent or guardian.
   All such contracts made by a minor not of the full age of 18 years
which may result in any personal liability for assessment shall have
the written assumption of any such liability by a parent or guardian
in consideration of the issuance of the contract.  Such assumption
shall be in a form approved by the commissioner, reasonably designed
to inform the parent or guardian of the liability thus assumed.
   Such assumption of liability may be made a part of and included
with any written consent of such parent or guardian required under
other provisions of this section and it may be provided therein that
such assumption shall cover only up to the anniversary date of the
policy nearest to the member's birthday at which he or she attains
age 18.


10112.5.  (a) Notwithstanding any other provision of law, every
policy or certificate of disability insurance covering hospital,
medical, or surgical expenses marketed, issued, or delivered to a
resident of this state, regardless of the situs of the contract or
master group policyholder, shall be subject to all provisions of this
code.
   (b) Subdivision (a) shall not apply to a policy of disability
insurance that covers hospital, medical, or surgical expenses and
that is issued outside of California to an employer whose principle
place of business and majority of employees are located outside of
California.
   (c) Nothing in subdivision (b) shall be construed to limit the
applicability of any other provision of this code to any policy of
disability insurance that covers hospital, medical, or surgical
expenses and that is issued outside of California to an employer
whose principle place of business and majority of employees are
located outside of California.



10112.6.  (a) Consistent with federal law, a sponsor of a
prescription drug plan authorized by the federal Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (P.L.
108-173) shall hold a valid license as a life and disability insurer
issued by the department or as a health care service plan issued by
the Department of Managed Health Care.
   (b) An entity that is licensed as a life and disability insurer
and that operates a prescription drug plan shall be subject to the
provisions of this code, unless preempted by federal law.



10113.  Every policy of life, disability, or life and disability
insurance issued or delivered within this State on or after the first
day of January, 1936, by any insurer doing such business within this
State shall contain and be deemed to constitute the entire contract
between the parties and nothing shall be incorporated therein by
reference to any constitution, by-laws, rules, application or other
writings, of either of the parties thereto or of any other person,
unless the same are indorsed upon or attached to the policy; and all
statements purporting to be made by the insured shall, in the absence
of fraud, be representations and not warranties.  Any waiver of the
provisions of this section shall be void.




10113.1.  (a) (1) As used in this section, a "viatical settlement"
means an agreement entered into between a person owning a life
insurance policy upon the life of a person with a catastrophic or
life-threatening illness or condition and another person by which the
policy owner receives compensation or anything of value less than
the death benefits of the insurance policy in return for an
assignment, transfer, sale, devise, or bequest of the death benefits
or ownership of the insurance policy, but does not include an
assignment of a life insurance policy to a licensed lending
institution or credit union as collateral for a loan.
   (2) As used in this section, "person" means any natural person or
legal entity including, but not limited to, individuals,
partnerships, associations, trusts, or corporations including a
resident or nonresident life and disability insurance agent licensed
by the commissioner.
   The life and disability insurance agents shall file with the
commissioner a declaration that the person's life and disability
agent license is valid and in good standing.  The life and disability
insurance agent shall provide copies of all endorsements and
appointments received by the agent to engage in the business of
viatical settlements.  If the commissioner determines that the agent'
s life and disability agent license is invalid or not in good
standing, or the agent has failed to submit any fees or proper
endorsements or appointments, the commissioner may suspend the agent'
s ability to transact or otherwise be involved in viatical
settlements.
   (b) A viatical settlement shall not include a provision for
payment of cash surrender values, loans or other benefits made by an
insurer in accordance with the policy provisions.
   (c) Any person entering into a viatical settlement with any person
with a catastrophic or life-threatening illness or condition shall
first obtain the following:
   (1) A written statement from a licensed medical practitioner
attending the person that the person is of sound mind and under no
constraint or undue influence.
   (2) A duly witnessed signed document in which the person consents
to the viatical settlement, acknowledges the catastrophic or
life-threatening illness, represents that he or she has a full and
complete understanding of the viatical settlement, that he or she has
a full and complete understanding of the benefits of the life
insurance policy, a release of his or her medical records, and
acknowledges that he or she has entered into the settlement freely
and voluntarily.
   (d) No person domiciled, residing or conducting business in
California may do any of the following unless he or she has complied
with subdivision (c):
   (1) Enter into a viatical settlement with any person, domiciled or
residing in California.
   (2) Execute a viatical settlement in whole or in part in this
state.
   (e) A violation of this section is a misdemeanor.



10113.2.  (a) This section applies to any person entering into or
soliciting viatical settlements pursuant to Section 10113.1.
   (b) (1) No person may enter into or solicit viatical settlements
pursuant to Section 10113.1 unless that person has been licensed by
the commissioner under this section.  The person shall file an
application for a license in the form prescribed by the commissioner,
and the application shall be accompanied by a fee of two thousand
eight hundred thirty-three dollars (,833).  The applicant shall
provide any information the commissioner may require.  The
commissioner may issue a license, or deny the application if, in his
or her discretion, it is determined that it is contrary to the
interests of the public to issue a license to the applicant.  The
reasons for a denial shall be set forth in writing.
   (2) Whenever it appears to the commissioner that it is contrary to
the interests of the public for a person licensed pursuant to this
section to continue to transact viatical settlements business, he or
she shall issue a notice to the licensee stating the reasons
therefor.  If, after a hearing, the commissioner concludes that it is
contrary to the interests of the public for the licensee to continue
to transact viatical settlements business, he or she may revoke the
person's license, or issue an order suspending the license for a
period as determined by the commissioner.  Any hearing conducted
pursuant to this paragraph shall be in accordance with Chapter 5
(commencing with Section 11500) of Part 1 of Division 3 of Title 2 of
the Government Code, except that the hearing may be conducted by
administrative law judges chosen pursuant to Section 11502 or
appointed by the commissioner, and the commissioner shall have the
powers granted therein.
   (3) Each licensee shall owe and pay in advance to the commissioner
an annual renewal fee of one hundred seventy-seven dollars (7).
This fee shall be for annual periods commencing on July 1 of each
year and ending on June 30 of each year, and shall be due on each
March 1 and shall be delinquent on and after each April 1.
   (4) Any licensee that intends to discontinue transacting viatical
settlements in this state shall so notify the commissioner, and shall
surrender its license.
   (c) A viatical settlements licensee shall file with the department
a copy of all viatical settlement forms used in this state.  No
licensee may use any viatical settlement form in this state unless it
has been approved by the commissioner.  Any viatical settlement form
filed with the commissioner shall be deemed approved if it has not
been disapproved within 60 days of filing. The commissioner shall
disapprove a viatical settlement form if, in his or her discretion,
the form, or provisions contained therein, are contrary to the
interests of the public, or otherwise misleading or unfair to the
consumer. The commissioner may rescind an approval for any reason or
on any basis that would have justified initial disapproval.  In the
case of disapproval or rescission of approval, the licensee may,
within 15 days of notice of the disapproval or rescission, request a
hearing before the commissioner or his or her designee, and the
hearing shall be held within 30 days of the request.
   (d) Viatical settlements licensees shall be required to disclose
or advise any applicant for a viatical settlement, at the time of
solicitation for the viatical settlement, of all of the following:
   (1) Possible alternatives to viatical settlements for persons with
catastrophic or life-threatening illness, including, but not limited
to, accelerated benefits options that may be offered by the life
insurer.
   (2) Tax consequences that may result from entering into a viatical
settlement.
   (3) Consequences for interruption of public assistance as provided
by information provided by the State Department of Health Services
and the State Department of Social Services under Section 11022 of
the Welfare and Institutions Code.
   (e) All medical information solicited or obtained by any person
soliciting or entering into a viatical settlement is subject to
Article 6.6 (commencing with Section 791) of Chapter 1 of Part 2 of
Division 1, concerning confidentiality of medical information.
   (f) The commissioner may adopt rules and regulations reasonably
necessary to govern viatical settlements and transactions and shall
adopt regulations to address those conflicts of interest that may
arise, including referrals by viatical settlement brokers to viatical
settlement providers who have patterns of unreasonable payments to
viators.  This authority includes, but is not limited to, regulation
of discount rates used to determine the amount paid in exchange for
assignment, transfer, sale, devise, or bequest of a death benefit
under a life insurance policy, and regulations restricting the period
of time within which a life or disability agent is prohibited from
charging or accepting a fee or commission for viaticating a policy
previously sold by that agent.  In adopting those regulations, the
commissioner shall consider the period of time applicable to that
prohibition.  The prohibition does not apply to group policies or
certificates.
   (g) The commissioner may, whenever he or she deems it reasonably
necessary to protect the interests of the public, examine the
business and affairs of any licensee or applicant for a license.  The
commissioner shall have the authority to order any licensee or
applicant to produce any records, books, files, or other information
as is reasonably necessary to ascertain whether or not the licensee
or applicant is acting or has acted in violation of the law or
otherwise contrary to the interests of the public.  The expenses
incurred in conducting any examination shall be paid by the licensee
or applicant.
   (h) The commissioner may investigate the conduct of any licensee,
its officers, employees, agents, or any other person involved in the
business of the licensee, whenever the commissioner has reason to
believe that the licensee may have acted, or may be acting, in
violation of the law, or otherwise contrary to the interests of the
public.  The commissioner may initiate an investigation on his or her
own, or upon a complaint filed by any other person.
   (i) The commissioner may issue orders to licensees whenever he or
she determines that it is reasonably necessary to ensure or obtain
compliance with this section, or Section 10113.1.  This authority
includes, but is not limited to, orders directing a licensee to cease
and desist in any practice that is in violation of this section, or
Section 10113.1, or otherwise contrary to the interests of the
public.  Any licensee to which an order pursuant to this subdivision
is issued may, within 15 days of receipt of that order, request a
hearing at which the licensee may challenge the order.
   (j) The commissioner may, after notice and a hearing at which it
is determined that a licensee has violated this section or Section
10113.1 or any order issued pursuant to this section, order the
licensee to pay a monetary penalty of up to ten thousand dollars
(,000), which may be recovered in a civil action.  Any hearing
conducted pursuant to this subdivision shall be in accordance with
Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of
Title 2 of the Government Code, except that the hearing may be
conducted by administrative law judges chosen pursuant to Section
11502 or appointed by the commissioner, and the commissioner shall
have the powers granted therein.
   (k) Each licensee shall file with the commissioner on or before
March 1 of each year an annual statement in the form prescribed by
the commissioner. The information that the commissioner may require
in the annual statement shall include, but not be limited to, the
data required to satisfy the commissioner's report to the Legislature
due on or before December 1, 1994.
   (l) No person who is not a resident of California may receive or
maintain a license unless a written designation of an agent for
service of process is filed and maintained with the commissioner.
The provisions of Article 3 (commencing with Section 1600) of Chapter
4 of Part 2 shall apply to viatical settlements licensees as if they
were foreign insurers, their license a certificate of authority, and
the viatical settlements a policy, and the commissioner may modify
the agreement set forth in Section 1604 accordingly.
   (m) No person licensed pursuant to this section shall engage in
any false or misleading advertising, solicitation, or practice.  The
provisions of Article 6 (commencing with Section 780) and Article 6.5
(commencing with Section 790) of Chapter 1 of Part 2 shall apply to
viatical settlements licensees as if they were insurers, their
license a certificate of authority or producer's license, and the
viatical settlements a policy, and the commissioner shall liberally
construe these provisions so as to protect the interests of the
public.
   (n) Any person who enters into a viatical settlement with a
viatical settlements licensee shall have the absolute right to
rescind the settlement within 15 days of execution of the settlement,
and any waiver or settlement language contrary to this subdivision
shall be void.
   (o) A violation of this section is a misdemeanor.



10113.4.  If a group life insurance policy contains a provision that
makes a certificate holder's coverage contestable on the grounds of
suicide for a period following commencement of coverage, only the
unexpired portion of that period shall be applied to a certificate
holder's individual conversion policy of an equal or lesser amount of
coverage.



10113.5.  (a) An individual life insurance policy delivered or
issued for delivery in this state shall contain a provision that it
is incontestable after it has been in force, during the lifetime of
the insured, for a period of not more than two years after its date
of issue, except for nonpayment of premiums and except for any of the
supplemental benefits described in Section 10271, to the extent that
the contestability of those benefits is otherwise set forth in the
policy or contract supplemental thereto.  An individual life
insurance policy, upon reinstatement, may be contested on account of
fraud or misrepresentation of facts material to the reinstatement
only for the same period following reinstatement, and with the same
conditions and exceptions, as the policy provides with respect to
contestability after original issuance.
   (b) (1) Notwithstanding subdivision (a), if photographic
identification is presented during the application process, and if an
impostor is substituted for a named insured in any part of the
application process, with or without the knowledge of the named
insured, then no contract between the insurer and the named insured
is formed, and any purported insurance contract is void from its
inception.
   (2) As used in this subdivision:
   (A) "Application process" means any or all of the steps required
of a named insured in applying for a certificate under an individual
policy of life insurance, including, but not limited to, executing
any part of the application form, submitting to medical or physical
examination or testing, or providing a sample or specimen of blood,
urine, or other bodily substance.
   (B) "Impostor" means a person other than the named insured who
participates in any manner in the application process for a
certificate under an individual life insurance policy and represents
himself or herself to be the named insured or represents that a
sample or specimen of blood, urine, or other bodily substance is that
of the named insured.
   (C) "Named insured" means the individual named in an application
form for a certificate under an individual life insurance policy as
the person whose life is to be insured.
   (c) This section shall not be construed to preclude at any time
the assertion of defenses based upon policy provisions that exclude
or restrict coverage.
   (d) This section shall not apply to individual life insurance
policies delivered or issued for delivery in this state on or before
December 31, 1973.



10113.6.  (a) An insurer that is required to deliver a life
insurance policy to the owner of the policy in order to start the
period running during which the owner may exercise any statutory
right to return a policy for cancellation, shall accomplish the
delivery by:
   (1) Registered or certified mail.
   (2) Personal delivery, with a signed, written receipt of delivery.

   (3) First-class mail, with a signed, written receipt of delivery.

   (4) Other reasonable means, as determined by the commissioner.
   (b) If an insurer does not deliver a policy by the means set forth
in subdivision (a), the burden of proof shall be on the insurer to
establish that the policy was delivered, in the event of a dispute
with the owner of the policy.
   (c) Notwithstanding subdivisions (a) and (b), a policy shall be
deemed to have been received six months after the date of issuance if
premiums have been paid.
   (d) An employer or corporate policy owner, or the plan trustee of
an employer or corporate policy owner who controls 100 or more
policies, shall have the option to request in writing from an insurer
the delivery of a sample policy with one or more census pages in a
form satisfactory to the employer, corporate policy owner, or plan
trustee, as an alternative to the delivery requirements of
subdivision (a).  However, delivery of the sample policy and census
page as provided in this subdivision shall be subject to the
provisions of subdivisions (a) and (b).  The insurer shall deliver
all of the policies listed on the census page to the employer,
corporate policy owner, or plan trustee within 30 days of demand for
delivery.  The delivery of the actual policies shall not institute a
new "free look" period.


10113.7.  (a) An increase of premium on an individual life insurance
policy that provides for premium changes by the insurer is not
effective unless written notice is delivered to the policyholder, or
mailed to his or her last known address as shown by the records of
the insurer, not less than 20 days prior to the effective date of the
increase.  If the notice is sent with or contained as part of an
ordinary premium or renewal invoice or payment request, the notice of
increase shall be prominently displayed and stated separately from
the ordinary statement of the amount due.
   (b) This section shall not apply to premium increases resulting
directly from changes in coverage requested by the policyholder, or
when the insurer has previously disclosed, in writing, either at the
time the policy was issued or during the life of the contract, a
specific date of change of premium, and the new premium amount.
   (c) Nothing in this section shall be construed to limit
application of any other provision of law, nor shall it be construed
to prevent application of any contractual provision affording greater
rights to the policyholder.



10113.8.  (a) Each health insurer that maintains an Internet Web
site shall make a downloadable copy of the comparative benefit matrix
prepared pursuant to Section 10127.14 available through a link on
its site to the Internet Web sites of the department and the
Department of Managed Health Care.
   (b) Each health insurer shall send copies of the comparative
benefit matrix on an annual basis, or more frequently as the matrix
is updated by the department and the Department of Managed Health
Care, to solicitors and solicitor firms and employers with whom it
contracts.  Each health insurer shall require its representatives and
the solicitors and soliciting firms with which it contracts, to
provide a copy of the comparative benefit matrix to individuals when
presenting any benefit package for examination or sale.
   (c) This section shall not apply to accident-only, specified
disease, hospital indemnity, CHAMPUS supplement, long-term care,
Medicare supplement, dental-only, or vision-only insurance policies.



10113.9.  (a) This section shall not apply to short-term limited
duration health insurance, vision-only, dental-only, or
Champus-supplement insurance, or to hospital indemnity,
hospital-only, accident-only, or specified disease insurance that
does not pay benefits on a fixed benefit, cash payment only basis.
   (b) No change in the premium rate or coverage for an individual
health insurance policy shall become effective unless the insurer has
delivered a written notice of the change at least 30 days prior to
the effective date of the contract renewal or the date on which the
rate or coverage changes. A notice of an increase in the premium rate
shall include the reasons for the rate increase.
   (c) The written notice required pursuant to subdivision (b) shall
be delivered to the individual policyholder at his or her last
address known to the insurer, at least 30 days prior to the effective
date of the change. The notice shall state in italics either the
actual dollar amount of the premium increase or the specific
percentage by which the current premium will be increased. The notice
shall describe in plain, understandable English any changes in the
policy or any changes in benefits, including a reduction in benefits
or changes to waivers, exclusions, or conditions, and highlight this
information by printing it in italics. The notice shall specify in a
minimum of 10-point bold typeface, the reason for a premium rate
change or a change in coverage or benefits.
   (d) If an insurer rejects an applicant or the dependents of an
applicant for coverage or offers individual coverage at a rate that
is higher than the standard rate, the insurer shall inform the
applicant about the state's high-risk health insurance pool, the
California Major Risk Medical Insurance Program (Part 6.5 (commencing
with Section 12700). The information provided to the applicant by
the insurer shall specifically include the program's toll-free
telephone number and its Internet Web site address. The requirement
to notify applicants of the availability of the California Major Risk
Medical Insurance Program shall not apply when a health plan rejects
an applicant for Medicare supplement coverage.



10113.95.  (a) A health insurer that issues, renews, or amends
individual health insurance policies shall be subject to this
section.
   (b) An insurer subject to this section shall have written
policies, procedures, or underwriting guidelines establishing the
criteria and process whereby the insurer makes its decision to
provide or to deny coverage to individuals applying for coverage and
sets the rate for that coverage. These guidelines, policies, or
procedures shall assure that the plan rating and underwriting
criteria comply with Sections 10140 and 10291.5 and all other
applicable provisions.
   (c) On or before June 1, 2006, and annually thereafter, every
insurer shall file with the commissioner a general description of the
criteria, policies, procedures, or guidelines that the insurer uses
for rating and underwriting decisions related to individual health
insurance policies, which means automatic declinable health
conditions, health conditions that may lead to a coverage decline,
height and weight standards, health history, health care utilization,
lifestyle, or behavior that might result in a decline for coverage
or severely limit the health insurance products for which they would
be eligible. An insurer may comply with this section by submitting to
the department underwriting materials or resource guides provided to
agents and brokers, provided that those materials include the
information required to be submitted by this section.
   (d) Commencing September 1, 2006, the commissioner shall post on
the department's Web site, in a manner accessible and understandable
to consumers, general, noncompany specific information about rating
and underwriting criteria and practices in the individual market and
information about the Major Risk Medical Insurance Program. The
commissioner shall develop the information for the Web site in
consultation with the Department of Managed Health Care to enhance
the consistency of information provided to consumers. Information
about individual health insurance shall also include the following
notification:
   "Please examine your options carefully before declining group
coverage or continuation coverage, such as COBRA, that may be
available to you. You should be aware that companies selling
individual health insurance typically require a review of your
medical history that could result in a higher premium or you could be
denied coverage entirely."
   (e) Nothing in this section shall authorize public disclosure of
company-specific rating and underwriting criteria and practices
submitted to the commissioner.
   (f) This section shall not apply to a closed block of business, as
defined in Section 10176.10.



10114.  Before an insurer may pay the proceeds of any contract of
life or disability insurance to any undertaker or funeral director,
as beneficiary or assignee, for funeral services, it shall require
proof satisfactory to it that the services have been rendered.  If
proof of rendition of services is not furnished within thirty days
after demand is made upon an insurer for such payment and in any
event within one year from the date of the insured's death, the
insurer shall pay the proceeds of such insurance to any contingent or
other beneficiary designated in the policy, and if no contingent or
other beneficiary is so designated, to the estate of the insured or
to any person, other than to such undertaker or funeral director,
equitably entitled to all or any portion of the proceeds by reason of
having incurred expense or furnished funeral services for the
insured, to the extent of the expense incurred or services furnished.



10115.  When a payment is made equal to the full first premium at
the time an application for life insurance other than group life
insurance is signed by the applicant and either (1) the applicant
received at that time a receipt for said payment on a form prepared
by the insurer, or (2) in the absence of such a receipt the insurer
receives the said payment at its home office, branch office, or the
office of one of its general agencies, and in either case the
insurer, pursuant to its regular underwriting practices and
standards, approves the application for the issuance by it of a
policy of life insurance on the plan and for the class of risk and
amount of insurance applied for, and the person to be insured dies on
or after the date of the application, on or after the date of the
medical examination, if any, or on or after any date specially
requested in the application for the policy to take effect, whichever
is later, but before such policy is issued and delivered, the
insurer shall pay such amount as would have been due under the terms
of the policy in the same manner and subject to the same rights,
conditions and defenses as if such policy had been issued and
delivered on the date the application was signed by the applicant.
The provisions of this section shall not prohibit an insurer from
limiting the maximum amount for which it may be liable prior to
actual issuance and delivery of the policy of life insurance either
to (1) an amount not less than its established maximum retention, or
to (2) fifty thousand dollars (,000), if a statement to this
effect is included in the application.



10116.  No group life insurance policy or disability insurance
policy shall be issued or delivered in this State where the premiums
or any part thereof is paid or is to be paid in whole or in part by
an employer pursuant to the terms of a collective bargaining
agreement unless the policy provides that in the event of a cessation
of work by the employees covered by the policy as the result of a
labor dispute the policy, upon timely payment of the premium, shall
continue in effect with respect to all employees insured by the
policy on the date of the cessation of work who continue to pay their
individual contribution, and who assume and pay the contribution due
from the employer, for the period of cessation of work, under the
following conditions:
   (a) If the policyholder is not a trustee or the trustees of a fund
established or maintained in whole or in part by the employer, the
policy shall provide that the employee's individual contribution
shall be the rate in the policy, on the date cessation of work
occurs, applicable to an individual in the class to which the
employee belongs as set forth in the policy.  If the policy does not
provide for a rate applicable to individuals, the policy shall
provide that the employee's individual contribution shall be an
amount equal to the amount determined by dividing (1) the total
monthly premium in effect under the policy at the date of cessation
of work by (2) the total number of persons insured under the policy
at such date.
   (b) If the policyholder is a trustee or the trustees of a fund
established or maintained in whole or in part by the employer, the
employee's contribution shall be the amount which he and his employer
would have been required to contribute to the trust for such
employee if (1) the cessation of work had not occurred and (2) the
agreement requiring the employer to make contributions to the trust
were in full force.
   (c) The policy may provide that the continuation of insurance is
contingent upon the collection of individual contributions by the
union or unions representing the employees for policies referred to
in subdivision (a) above, and by the policyholder or the policyholder'
s agent with respect to policies referred to in subdivision (b)
above.
   (d) The policy may provide that the continuation of insurance on
each employee is contingent upon timely payment of contributions by
the individual and timely payment of the premium by the entity
responsible for collecting the individual contributions.
   (e) The policy may provide that each individual premium rate shall
be increased by any amount up to twenty percent (20%), or any higher
percent which may be approved by the commissioner, of that otherwise
shown in the policy during the period of cessation of work in order
to provide sufficient compensation to the insurer to cover increased
administrative costs and increased mortality and morbidity.  If the
policy does provide for such an increase, this shall have the effect
of increasing the employee's contribution by a like percent.
   (f) Nothing in this section shall be deemed to limit any right
which the insurer may have in accordance with the terms of the policy
to increase or decrease the premium rates before, during or after
such cessation of work if, in fact, the insurer would have had the
right to increase the premium rate had the cessation of work not
occurred.  If such a premium rate change is made, it shall be
effective, notwithstanding any other provisions of this section, on
such date as the insurer shall determine in accordance with the terms
of the policy.
   (g) The policy may contain such other provisions with respect to
such continuation of insurance as the commissioner may approve.
   (h) The policy may provide that, if a premium is unpaid at the
date of cessation of work and such premium became due prior to such
cessation of work, the continuation of insurance is contingent upon
payment of such premium prior to the date the next premium becomes
due under the terms of the policy.
   Nothing herein shall be deemed to require the continuation of any
loss of time payments included in any such group disability policy,
nor of any other coverages beyond the time that seventy-five percent
(75%) of the employees continue such coverage or as to any individual
employee beyond the time that he takes full-time employment with
another employer; nor shall anything herein be deemed to require
continuation of coverage more than six (6) months after the cessation
of work.
   Nothing in this section shall be construed as modifying or in any
way affecting the operation and effect of the provisions of Part 2 of
Division 1 of the Unemployment Insurance Code.



10116.5.  (a) Every policy of disability insurance that is issued,
amended, delivered, or renewed in this state on or after January 1,
1999, that provides hospital, medical, or surgical expense coverage
under an employer-sponsored group plan for an employer subject to
COBRA, as defined in subdivision (e), or an employer group for which
the disability insurer is required to offer Cal-COBRA coverage, as
defined in subdivision (f), including a carrier providing replacement
coverage under Section 10128.3, shall further offer the former
employee the opportunity to continue benefits as required under
subdivision (b), and shall further offer the former spouse of an
employee or former employee the opportunity to continue benefits as
required under subdivision (c).
   (b) (1) If a former employee worked for the employer for at least
five years prior to the date of termination of employment and is 60
years of age or older on the date employment ends is entitled to and
so elects to continue benefits under COBRA or Cal-COBRA for himself
or herself and for any spouse, the employee or spouse may further
continue benefits beyond the date coverage under COBRA or Cal-COBRA
ends, as set forth in paragraph (2).  Except as otherwise specified
in this section, continuation coverage shall be under the same
benefit terms and conditions as if the continuation coverage under
COBRA or Cal-COBRA had remained in force.  For the employee or
spouse, continuation coverage following the end of COBRA or Cal-COBRA
is subject to payment of premiums to the insurer.  Individuals
ineligible for COBRA or Cal-COBRA or who are eligible but have not
elected or exhausted continuation coverage under federal COBRA or
Cal-COBRA are not entitled to continuation coverage under this
section.  Premiums for continuation coverage under this section shall
be billed by, and remitted to, the insurer in accordance with
subdivision (d).  Failure to pay the requisite premiums may result in
termination of the continuation coverage in accordance with the
applicable provisions in the insurer's group contract with the
employer.
   (2) The employer shall notify the former employee or spouse or
both, or the former spouse of the employee or former employee, of the
availability of the continuation benefits under this section in
accordance with Section 2800.2 of the Labor Code.  To continue health
care coverage pursuant to this section, the individual shall elect
to do so by notifying the insurer in writing within 30 calendar days
prior to the date continuation coverage under COBRA or Cal-COBRA is
scheduled to end.  Every disability insurer shall provide to the
employer replacing a group benefit plan policy issued by the insurer,
or to the employer's agent or broker representative, within 15 days
of any written request, information in possession of the insurer
reasonably required to administer the requirements of Section 2800.2
of the Labor Code.
   (3) The continuation coverage shall end automatically on the
earlier of (A) the date the individual reaches age 65, (B) the date
the individual is covered under any group health plan not maintained
by the employer or any other insurer or health care service plan,
regardless of whether that coverage is less valuable, (C) the date
the individual becomes entitled to Medicare under Title XVIII of the
Social Security Act, (D) for a spouse, five years from the date on
which continuation coverage under COBRA or Cal-COBRA was scheduled to
end for the spouse, or (E) the date on which the employer terminates
its group contract with the insurer and ceases to provide coverage
for any active employees through that insurer, in which case the
insurer shall notify the former employee or spouse, or both, of the
right to a conversion policy.
   (c) (1) If a former spouse of an employee or former employee was
covered as a qualified beneficiary under COBRA or Cal-COBRA, the
former spouse may further continue benefits beyond the date coverage
under COBRA or Cal-COBRA ends, as set forth in paragraph (2) of
subdivision (b).  Except as otherwise specified in this section,
continuation coverage shall be under the same benefit terms and
conditions as if the continuation coverage under COBRA or Cal-COBRA
had remained in force.  Continuation coverage following the end of
COBRA or Cal-COBRA is subject to payment of premiums to the insurer.
Premiums for continuation coverage under this section shall be
billed by, and remitted to, the insurer in accordance with
subdivision (d).  Failure to pay the requisite premiums may result in
termination of the continuation coverage in accordance with the
applicable provisions in the insurer's group contract with the
employer or former employer.
   (2) The continuation coverage for the former spouse shall end
automatically on the earlier of (A) the date the individual reaches
65 years of age, (B) the date the individual is covered under any
group health plan not maintained by the employer or any other health
care service plan or insurer, regardless of whether that coverage is
less valuable, (C) the date the individual becomes entitled to
Medicare under Title XVIII of the Social Security Act, (D) five years
from the date on which continuation coverage under COBRA or
Cal-COBRA was scheduled to end for the former spouse, or (E) the date
on which the employer or former employer terminates its group
contract with the insurer and ceases to provide coverage for any
active employees through that insurer, in which case the insurer
shall notify the former spouse of the right to a conversion policy.
   (d) (1) If the premium charged to the employer for a specific
employee or dependent eligible under this section is adjusted for the
age of the specific employee, or eligible dependent, on other than a
composite basis, the rate for continuation coverage under this
section shall not exceed 102 percent of the premium charged by the
insurer to the employer for an employee of the same age as the former
employee electing continuation coverage in the case of an individual
who was eligible for COBRA, and 110 percent in the case of an
individual who was eligible for Cal-COBRA.  If the coverage continued
is that of a former spouse, the premium charged shall not exceed 102
percent of the premium charged by the plan to the employer for an
employee of the same age as the former spouse selecting continuation
coverage in the case of an individual who was eligible for COBRA, and
110 percent in the case of an individual who was eligible for
Cal-COBRA.
   (2) If the premium charged to the employer for a specific employee
or dependent eligible under this section is not adjusted for age of
the specific employee, or eligible dependent, then the rate for
continuation coverage under this section shall not exceed 213 percent
of the applicable current group rate.  For purposes of this section,
the "applicable current group rate" means the total premiums charged
by the insurer for coverage for the group, divided by the relevant
number of covered persons.
   (3) However, in computing the premiums charged to the specific
employer group, the insurer shall not include consideration of the
specific medical care expenditures for beneficiaries receiving
continuation coverage pursuant to this section.
   (e) For purposes of this section, "COBRA" means Section 4980B of
Title 26, Section 1161 and following of Title 29, and Section 300bb
of Title 42 of the United States Code, as added by the Consolidated
Omnibus Budget Reconciliation Act of 1985 (P.L. 99-272), and as
amended.
   (f) For purposes of this section, "Cal-COBRA" means the
continuation coverage that must be offered pursuant to Article 1.7
(commencing with Section 10128.50), or Article 4.5 (commencing with
Section 1366.20) of Chapter 2.2 of Division 2 of the Health and
Safety Code.
   (g) For the purposes of this section, "former spouse" means either
an individual who is divorced from an employee or former employee or
an individual who was married to an employee or former employee at
the time of the death of the employee or former employee.
   (h) Every group benefit plan evidence of coverage that is issued,
amended, or renewed after January 1, 1999, shall contain a
description of the provisions and eligibility requirements for the
continuation coverage offered pursuant to this section.
   (i) This section shall take effect on January 1, 1999.
   (j) This section does not apply to any individual who is not
eligible for its continuation coverage prior to January 1, 2005.



10117.  (a) A policy of disability insurance, self-insured employee
welfare benefit plan, or nonprofit hospital service plan may not
provide an exception for other coverage where  the other coverage is
entitlement to Medi-Cal benefits under Chapter 7 (commencing with
Section 14000) or Chapter 8 (commencing with Section 14500) of Part 3
of Division 9 of the Welfare and Institutions Code, or medicaid
benefits under Subchapter 19 (commencing with Section 1396) of
Chapter 7 of Title 42 of the United States Code.  Each policy of
disability insurance shall be interpreted not to provide an exception
for those Medi-Cal or medicaid benefits.
   (b) A policy of disability insurance may not provide that the
benefits payable thereunder are subject to reduction if the
individual insured has entitlement to such Medi-Cal benefits.
   (c) A policy of disability insurance, self-insured employee
welfare benefit plan, or nonprofit hospital service plan shall not
provide an exception for enrollment for benefits because of an
applicant's entitlement to Medi-Cal benefits under Chapter 7
(commencing with Section 14000) or Chapter 8 (commencing with Section
14500) of Part 3 of Division 9 of the Welfare and Institutions Code,
or medicaid benefits under Subchapter 19 (commencing with Section
1396) of Chapter 7 of Title 42 of the United States Code.



10117.5.  No disability insurer contract that covers hospital,
medical, or surgical benefits that is issued, amended, renewed, or
delivered on and after January 1, 2002, shall contain a provision
that prohibits or restricts any health facilities' compliance with
the requirements of Section 1262.5 of the Health and Safety Code.




10118.  A policy of disability insurance delivered or issued for
delivery in this state more than 120 days after the effective date of
this section, which provides that coverage of a dependent child
shall terminate upon attainment of the limiting age for dependent
children specified in the policy or contract, shall also provide in
substance that attainment of such limiting age shall not operate to
terminate the coverage of such child while the child is and continues
to be both (a) incapable of self-sustaining employment by reason of
mental retardation or physical handicap and (b) chiefly dependent
upon the insured for support and maintenance, provided proof of such
incapacity and dependency is furnished to the insurer by the insured
within 31 days of the child's attainment of the limiting age and
subsequently as may be required by the insurer, but not more
frequently than annually after the two-year period following the
child's attainment of the limiting age.
   Disability policies currently approved by the commissioner which
are delivered or issued for delivery more than 120 days after the
effective date of this section shall be automatically construed to be
in compliance with this section and need not be refiled or
reprinted.  Disability policies submitted to the commissioner for
approval on and after the effective date of this section shall
contain provisions in compliance with this section.



10119.  On and after the operative date of this section:
   (a) No policy of disability insurance which, in addition to
covering the insured, also covers members of the insured's immediate
family, may be issued or amended in this state if it contains any
disclaimer, waiver, or other limitation of coverage relative to the
accident and sickness coverage or insurability of newborn infants of
an insured from and after the moment of birth or of any minor child
placed with an insured for adoption from and after the moment the
child is placed in the physical custody of the insured for adoption.

   (b) Each such policy of disability insurance shall contain a
provision granting immediate accident and sickness coverage to each
newborn infant of, and each minor child placed for adoption with, any
insured as required by subdivision (a).
   (c) A policy of disability insurance, self-insured care coverage,
employee welfare benefit plan, or nonprofit hospital service plan,
shall comply with the standards set forth in Chapter 7 (commencing
with Section 3750) of Part 1 of Division 9 of the Family Code and
Section 14124.94 of the Welfare and Institutions Code.



10119.1.  (a) This section shall apply to a health insurer that
covers hospital, medical, or surgical expenses under an individual
health benefit plan, as defined in subdivision (a) of Section
10198.6, that is issued, amended, renewed, or delivered on or after
January 1, 2007.
   (b) At least once each year, a health insurer shall permit an
individual who has been covered for at least 18 months under an
individual health benefit plan to transfer, without medical
underwriting, to any other individual health benefit plan offered by
that same health insurer that provides equal or lesser benefits as
determined by the insurer.
   "Without medical underwriting" means that the health insurer shall
not decline to offer coverage to, or deny enrollment of, the
individual or impose any preexisting condition exclusion on the
individual who transfers to another individual health benefit plan
pursuant to this section.
   (c) The insurer shall establish, for the purposes of subdivision
(b), a ranking of the individual health benefit plans it offers to
individual purchasers and post the ranking on its Internet Web site
or make the ranking available upon request. The insurer shall update
the ranking whenever a new benefit design for individual purchasers
is approved.
   (d) The insurer shall notify in writing all insureds of the right
to transfer to another individual health benefit plan pursuant to
this section, at a minimum, when the insurer changes the insured's
premium rate. Posting this information on the insurer's Internet Web
site shall not constitute notice for purposes of this subdivision.
The notice shall adequately inform insureds of the transfer rights
provided under this section including information on the process to
obtain details about the individual health benefit plans available to
that insured and advising that the insured may be unable to return
to his or her current individual health benefit plan if the insured
transfers to another individual health benefit plan.
   (e) The requirements of this section shall not apply to the
following:
   (1) A federally eligible defined individual, as defined in
subdivision (e) of Section 10900, who purchases individual coverage
pursuant to Section 10785.
   (2) An individual offered conversion coverage pursuant to Sections
12672 and 12682.1.
   (3) An individual enrolled in the Medi-Cal program pursuant to
Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of
the Welfare and Institutions Code.
   (4) An individual enrolled in the Access for Infants and Mothers
Program, pursuant to Part 6.3 (commencing with Section 12695).
   (5) An individual enrolled in the Healthy Families Program
pursuant to Part 6.2 (commencing with Section 12693).
   (f) It is the intent of the Legislature that individuals shall
have more choice in their health care coverage when health insurers
guarantee the right of an individual to transfer to another product
based on the insurer's own ranking system. The Legislature does not
intend for the department to review or verify the insurer's ranking
for actuarial or other purposes.



10119.5.  (a) No individual or group policy of health insurance that
is issued, amended, renewed, or delivered on or after July 1, 2003,
that provides maternity coverage shall contain a copayment or
deductible for inpatient hospital maternity services that exceeds the
most common amount of the copayment or deductible contained in the
policy for inpatient services provided for other covered medical
conditions or contain a copayment or deductible for ambulatory care
maternity services that exceeds the most common amount of the
copayment or deductible contained in the policy for ambulatory care
services provided for other covered medical conditions.
   (b) No group or blanket policy of health insurance that provides
maternity benefits for a person covered continuously from conception
shall be issued, amended, delivered, or renewed in this state if it
contains any exclusion, reduction, or other limitations as to
coverage, deductibles, or coinsurance provisions, as to involuntary
complications of pregnancy, unless the provisions apply generally to
all benefits paid under the policy.
   (c) For purposes of this section, involuntary complications of
pregnancy shall include, but not be limited to, puerperal infection,
eclampsia, cesarean section delivery, ectopic pregnancy, and toxemia.

   (d) This section shall not apply to Medicare supplement,
vision-only, or Champus-supplement insurance, or to hospital
indemnity, accident-only, and specified disease insurance that does
not pay benefits on a fixed benefit, cash payment only basis.
   (e) This section shall not permit copayments or deductibles in the
Medi-Cal program that are not otherwise authorized under state or
federal law.
   (f) This section shall become operative on July 1, 2003.




10119.6.  (a) On and after January 1, 1990, every insurer issuing,
renewing, or amending a policy of disability insurance which covers
hospital, medical, or surgical expenses on a group basis shall offer
coverage of infertility treatment, except in vitro fertilization,
under  those terms and conditions as may be agreed upon between the
group policyholder and the insurer.  Every insurer shall communicate
the availability of that coverage to all group policyholders and to
all prospective group policyholders with whom they are negotiating.
   (b) For purposes of this section,  "infertility" means either (1)
the presence of a demonstrated condition recognized by a licensed
physician and surgeon as a cause of infertility, or (2) the inability
to conceive a pregnancy or to carry a pregnancy to a live birth
after a year or more of regular sexual relations without
contraception.  "Treatment for infertility" means procedures
consistent with established medical practices in the treatment of
infertility by licensed physicians and surgeons including, but not
limited to, diagnosis, diagnostic tests, medication, surgery, and
gamete intrafallopian transfer.  "In vitro fertilization" means the
laboratory medical procedures involving the actual in vitro
fertilization process.
   (c) Nothing in this section shall be construed to deny or restrict
in any way any existing right or benefit to coverage and treatment
of infertility under an existing law, plan or policy.
   (d) Nothing in this section shall be construed to require any
employer that is a religious organization to offer coverage for forms
of treatment of infertility in a manner inconsistent with the
religious organization's religious and ethical principles.
   (e) Nothing in this section shall be construed to require any
insurer, which is a subsidiary of an entity whose owner or corporate
member is a religious organization, to offer coverage for treatment
of infertility in a manner inconsistent with that religious
organization's religious and ethical principles.
   For purposes of this subdivision, "subsidiary" of a specified
corporation means a corporation more than 45 percent of the voting
power of which is owned directly, or indirectly through one or more
subsidiaries, by the specified corporation.
   (f) This section applies to every disability insurance policy
which is issued, amended, or renewed to residents of this state
regardless of the situs of the contract.



10119.7.  No group or individual policy of disability insurance
which covers hospital, medical, or surgical expenses shall be issued,
amended, delivered, or renewed in  this state on or after January 1,
1981, if it contains any exclusion, reduction, or other limitations,
as to coverage, deductibles, or coinsurance provisions applicable
solely to conditions attributable to diethylstilbestrol or exposure
to diethylstilbestrol.
   All policies subject to this section and issued, amended,
delivered, or renewed in this state on or after January 1, 1981,
shall be construed to be in compliance with this section, and any
provision in any such policy which is in conflict with this section
shall be of no force or effect.



10119.8.  On and after January 1, 1993, every insurer issuing,
amending, or renewing a policy of individual or group disability
insurance that covers hospital, medical, or surgical expenses shall
offer coverage for screening for blood lead levels for covered
children.  This section shall not apply to specified accident,
specified disease, hospital indemnity, Medicare supplement, or
long-term care health insurance policies.



10119.9.  (a) A disability insurance policy or certificate covering
hospital, surgical, or medical expenses, that meets the definition of
"health benefit plan" in subdivision (a) of Section 10198.6, that is
issued, amended, renewed, or delivered on or after January 1, 2000,
shall be deemed to cover general anesthesia and associated facility
charges for dental procedures rendered in a hospital or surgery
center setting, when the clinical status or underlying medical
condition of the insured requires dental procedures that ordinarily
would not require general anesthesia to be rendered in a hospital or
surgery center setting.  The disability insurance policy or
certificate may require prior authorization of general anesthesia and
associated charges required for dental care procedures in the same
manner that prior authorization is required for other covered
diseases or conditions.
   (b) This section shall apply only to general anesthesia and
associated facility charges for only the following insureds, and only
if the insureds meet the criteria in subdivision (a):
   (1) Insureds who are under seven years of age.
   (2) Insureds who are developmentally disabled, regardless of age.

   (3) Insureds whose health is compromised and for whom general
anesthesia is medically necessary, regardless of age.
   (c) Nothing in this section shall require insurers to cover any
charges for the dental procedure itself, including the professional
fee of the dentist.  Coverage for anesthesia and associated facility
charges pursuant to this section shall be subject to all other terms
and conditions of the policy or certificate that apply generally to
other benefits.
   (d) Nothing in this section shall require insurers to cover
anesthesia or related facility charges for dental procedures that
ordinarily would require general anesthesia and that do not meet the
requirements of subdivision (a), (b), or (c).
   (e) A disability insurance policy may include coverage specified
in subdivision (a) at any time prior to January 1, 2000.



10120.  If a policy of disability insurance issued, issued for
delivery, or renewed in this state after the effective date of this
section provides in any manner for payment of all or part of the cost
of a "sterilization operation or procedure" any exclusion,
reduction, or limitation on such a benefit based upon the reason, or
reasons, of the covered persons for requesting such sterilization
shall be void and of no effect.
   All disability policies issued, issued for delivery, or renewed in
this state after effective date of this section shall be
automatically construed to be in compliance with this section and
need not be refiled or reprinted.
   As used in this code, "sterilization operations or procedures"
shall include and mean any operation or procedure altering the human
body which has as its purpose, or one of its purposes, the temporary
or permanent prevention of procreation by either a male or a female.



10120.2.  (a)  This section shall only apply to a disability insurer
that issues a dental insurance policy pursuant to this part.
   (b) For purposes of this section, the following terms have the
following meanings:
   (1) "Coordination of benefits" means the method by which a
disability insurer and one or more other disability insurers, health
care service plans covering dental services, or specialized health
care service plans, covering dental services, pay their respective
reimbursements for dental benefits when an insured is covered by
multiple disability insurers, or a combination of disability insurers
and health care service plans or specialized health care service
plans.
   (2) "Primary dental benefit plan" means a dental insurance policy
issued by a disability insurer regulated pursuant to this part or a
health care service plan or specialized health care service plan
contract regulated pursuant to Chapter 2.2 (commencing with Section
1340) of Division 2 of the Health and Safety Code that provides an
insured or enrollee with primary dental coverage.
   (3) "Secondary dental benefit plan" means a dental insurance
policy issued by a disability insurer regulated pursuant to this part
or a health care service plan or specialized health care service
plan contract regulated pursuant to Chapter 2.2 (commencing with
Section 1340) of Division 2 of the Health and Safety Code that
provides an insured or enrollee with secondary dental coverage.
   (c) A disability insurer that issues a dental insurance policy
shall declare its coordination of benefits policy prominently in its
evidence of coverage or insurance policy with both insured and
policyholder.
   (d) When a primary dental benefit plan is coordinating its
benefits with one or more secondary dental benefit plans, it shall
pay the maximum amount required by its policy with the insured or
policyholder.
   (e) A disability insurer that issues a dental insurance policy,
when acting as a secondary dental benefit plan or insurer, shall pay
the lesser of either the amount it would have paid in the absence of
any other dental benefit coverage, or the insured's total
out-of-pocket cost payable under the primary dental benefit plan for
benefits covered under the secondary plan or policy.
   (f) Nothing in this section is intended to conflict with or modify
the way in which a disability insurer that issues a dental insurance
policy determines which dental benefit plan is primary and which is
secondary in coordinating benefits with another insurer or plan
pursuant to existing state law or regulation.



10120.5.  Any act by a disability insurer that covers hospital,
medical, or surgical expenses that violates Section 510, Section
2056, or Section 2056.1 of the Business and Professions Code shall
also be a violation of this code.


10121.  (a) No self-insured employee welfare benefit plan, issued or
renewed on or after November 23, 1970, which contains coverage for
sterilization operations or procedures, shall impose any disclaimer,
restriction on, or limitation of, coverage relative to the covered
individual's reason for sterilization.  All those plans entered into
or renewed on or after November 23, 1970, shall be construed to be in
compliance with this section, and any provision in any plan which is
in conflict with this section shall be of no force or effect.
   (b) Every self-insured employee welfare benefit plan issued or
amended on or after July 1, 1972, which provides benefits to the
employee's dependents, shall contain a provision granting immediate
accident and sickness coverage, from and after the moment of birth,
to each newborn infant of any family covered and to each minor child
placed for adoption from and after the moment the child is placed in
the physical custody of the covered family for adoption.  No plan may
be issued or amended if it contains any disclaimer, waiver, or other
limitation of coverage relative to the coverage or insurability of
newborn infants of or minor children placed for adoption with a
family covered as required by this section.  Coverage of minor
children placed for adoption with a covered family shall be required
only after January 1, 1988.
   (c) No self-insured employee welfare benefit plan which provides
maternity benefits for a person covered continuously from conception
shall be issued, amended, delivered, or renewed in this state on or
after July 1, 1976, if it contains any exclusion, reduction, or other
limitations as to coverage, deductibles, or coinsurance provisions
as to involuntary complications of pregnancy, unless those provisions
apply generally to all benefits paid under the plan.  If a fixed
amount is specified in the plan for surgery, the fixed amounts for
surgical procedures involving involuntary complications of pregnancy
shall be commensurate with other fixed amounts payable for procedures
of comparable difficulty and severity.  In a case where a fixed
amount is payable for maternity benefits, involuntary complications
of pregnancy shall be deemed an illness and entitled to benefits
otherwise provided by the plan.  Where the plan contains a maternity
deductible, the maternity deductible shall apply only to expenses
resulting from normal delivery and cesarean section delivery.
However, expenses for cesarean section delivery in excess of the
deductible shall be treated as expenses for any other illness under
the plan. This subdivision shall apply to all self-insured employee
welfare benefit plans except any plan made subject to an applicable
collective bargaining agreement in effect before July 1, 1976.
   For purposes of this subdivision, involuntary complications of
pregnancy shall include, but not be limited to, puerperal infection,
eclampsia, cesarean section delivery, ectopic pregnancy, and toxemia.

   All plans subject to this subdivision and issued, amended,
delivered, or renewed in this state on or after July 1, 1976, shall
be construed to be in compliance with this section, and any provision
in any plan which is in conflict with this section shall be of no
force or effect.
   (d) Every self-insured employee welfare benefit plan issued or
amended on or after January 1, 1987, which provides benefits to the
employee's dependents, shall offer a choice to all employees of
coverage for comprehensive preventive health care for children.
   (e) For purposes of this section, benefits for the comprehensive
preventive care of children shall be consistent with the Guidelines
for Health Supervision of Children and Youth, as adopted by the
American Academy of Pediatrics in May 1982, and provide for the
following:
   (1) Physician service for routine physical examinations.
   (2) Immunizations.
   (3) Laboratory services in connection with routine physical
examinations.
   (f) As used in this section, "self-insured employee welfare
benefit plan" means any plan or program of benefits provided by an
employer or an employee organization, or both, for the purpose of
providing hospital, medical, surgical, nursing, or dental services,
or indemnification for the costs incurred for those services, to the
employer's employees or their dependents.



10121.5.  (a) When a husband and wife are both employed as
employees, and both have enrolled themselves and their eligible
family members under a group policy of disability insurance provided
by their respective employers, and each spouse is covered as an
employee under the terms of the same master policy, each spouse may
claim on his or her behalf, or on behalf of his or her enrolled
dependents, the combined maximum contractual benefits to which an
employee is entitled under the terms of the master policy, not to
exceed in the aggregate 100 percent of the charge for the covered
expense or service.
   (b) When a husband and wife are both employed as employees, and
both have enrolled themselves and their eligible family members under
a self-insured employee welfare benefit plan provided by their
respective employers, and each spouse is covered as an employee under
the terms of the same master contract, each spouse may claim on his
or her behalf, or on behalf of his or her enrolled dependents, the
combined maximum contractual benefits to which an employee is
entitled under the terms of the master contract, not to exceed in the
aggregate 100 percent of the charge for the covered expense or
service.
   (c) This section shall apply to every group disability insurance
policy and self-insured employee welfare benefit plan which is
entered into, issued, delivered, amended, or renewed in this state on
or after January 1, 1978.



10121.6.  (a) No policy of group disability insurance or
self-insured employee welfare benefit plan which provides hospital,
medical, or surgical expense benefits for employees, insureds, or
policyholders and their dependents shall exclude a dependent child
from eligibility or benefits solely because the dependent child does
not reside with the employee, insured, or policyholder.
   (b) Each policy of group disability insurance or self-insured
employee welfare benefit plan which provides hospital, medical, or
surgical expense benefits for employees, insureds, or policyholders
and their dependents shall enroll, upon application by the employer
or group administrator, a dependent child of the noncustodial parent
when that parent is the employee, insured, or policyholder at any
time either the parent or the person having custody of the child as
defined in Section 3751.5 of the Family Code, or the local child
support agency makes an application for enrollment to the employer or
group administrator when a court order for medical support exists.
In the case of children who are eligible for medicaid, the State
Department of Health Services may also make that application.



10121.7.  (a) A policy of group health insurance that provides
hospital, medical, or surgical expense benefits shall provide equal
coverage to employers or guaranteed associations, as defined in
Section 10700, for the registered domestic partner of an employee,
insured, or policyholder to the same extent, and subject to the same
terms and conditions, as provided to a spouse of the employee,
insured, or policyholder, and shall inform employers and guaranteed
associations of this coverage.  A policy may not offer or provide
coverage for a registered domestic partner that is not equal to the
coverage provided to the spouse of an employee, insured, or
policyholder.
   (b) If an employer or guaranteed association has purchased
coverage for spouses and registered domestic partners pursuant to
subdivision (a), a health insurer that provides hospital, medical, or
surgical expense benefits for employees, insureds, or policyholders
and their spouses shall enroll, upon application by the employer or
group administrator, a registered domestic partner of the employee,
insured, or policyholder in accordance with the terms and conditions
of the group contract that apply generally to all spouses under the
policy, including coordination of benefits.
   (c) For purposes of this section, the term "domestic partner"
shall have the same meaning as that term is used in Section 297 of
the Family Code.
   (d) (1) A policy of group health insurance may require that the
employee, insured, or policyholder verify the status of the domestic
partnership by providing to the insurer a copy of a valid Declaration
of Domestic Partnership filed with the Secretary of State pursuant
to Section 298 of the Family Code or an equivalent document issued by
a local agency of this state, another state, or a local agency of
another state under which the partnership was created.  The policy
may also require that the employee, insured, or policyholder notify
the insurer upon the termination of the domestic partnership.
   (2) Notwithstanding paragraph (1), a policy may require the
information described in that paragraph only if it also requests from
the employee, insured, or policyholder whose spouse is provided
coverage, verification of marital status and notification of
dissolution of the marriage.
   (e) Nothing in this section shall be construed to expand the
requirements of Section 4980B of Title 26 of the United States Code,
Section 1161, and following, of Title 29 of the United States Code,
or Section 300bb-1, and following, of Title 42 of the United States
Code, as added by the Consolidated Omnibus Budget Reconciliation Act
of 1985 (Public Law 99-272), and as those provisions may be later
amended.
   (f) A group health insurance policy subject to this section that
is issued, amended, delivered, or renewed in this state on or after
January 2, 2005, shall be deemed to provide coverage for registered
domestic partners that is equal to the coverage provided to a spouse
of an employee, insured, or policyholder.


10122.  If a policy of group disability insurance issued or issued
for delivery or amended in this state after the effective date of
this section provides in any manner for coverage for an employee and
one or more covered persons dependent upon such employee and provides
for an extension of coverage for any period following a termination
of employment of the employee, the policy shall provide that such
extension of coverage shall apply to dependents upon the same terms
and conditions precedent as applied to the covered employee, for the
same period of time, subject to payment of premiums, if any, as
required by the terms of the policy and subject to any applicable
collective bargaining agreement.
   All such group disability policies issued or issued for delivery
or amended in this state after the effective date of this section
shall be automatically construed to be in compliance with this
section and need not be refiled or reprinted.



10122.1.  On and after the effective date of this section, every
policy of disability insurance which covers hospital, medical, or
surgical expenses on a group basis shall offer coverage to physically
handicapped individual members of the group under the same terms and
conditions as are normally offered to individual members of the
group without physical handicap.  The availability of such coverage
shall be communicated to group policyholders and to prospective group
policyholders during negotiations.  Group policies shall not be
required to cover hospital, medical, or surgical expenses arising as
a direct result of an individual  member's physical handicap.



10122.2.  If a policy of group disability insurance issued,
delivered, amended, or renewed in this state on or after the
effective date of this section provides in any manner for coverage
for an employee and a covered spouse dependent upon such employee,
the policy shall not provide for coverage under conditions less
favorable for employees than coverage provided for covered spouses
dependent upon the employees.



10123.  (a) No self-insured employee welfare benefit plan, issued or
renewed on or after the effective date of this section, which
provides coverage for an employee and one or more covered persons
dependent upon such employee and provides for an extension of
coverage for any period following a termination of employment of the
employee, shall fail to provide that such extension of coverage shall
apply to dependents upon the same terms and conditions precedent as
applied to the covered employee, for the same period of time, subject
to payment of premiums, if any, as required by the terms of the
policy and subject to any limitations or conditions set forth in any
applicable collective-bargaining agreement.  All such plans entered
into or renewed on or after the effective date of this section shall
be construed to be in compliance with this section, and any provision
in any such plan which is in conflict with this section shall be of
no force or effect.
   (b) A plan contract which provides benefits that accrue after a
certain time of confinement in a health care facility shall specify
what constitutes a day of confinement or the number of consecutive
hours of confinement which are requisite to the commencement of
benefits.
   (c) As used in subdivisions (a) and (b), "self-insured employee
welfare benefit plan" has the same meaning as that specified in
subdivision (d) of Section 10121.



10123.1.  Every self-insured employee welfare benefit plan, as
defined in Section 10121, issued, amended as to benefits, or renewed
after January 1, 1977, shall comply with the requirements of Article
1.5 (commencing with Section 10128) of this chapter.




10123.2.  On and after the effective date of this section, every
self-insured employee welfare benefit plan which provides coverage
for hospital, medical, or surgical expenses shall offer coverage to
physically handicapped persons for such expenses incurred, under such
terms and conditions as are normally provided by the self-insured
welfare benefit plan and a member without physical handicap.  Every
self-insured welfare benefit plan shall communicate the availability
of such coverage to all members and prospective members.  The
self-insured welfare benefit plan shall not be required to cover
hospital, medical, or surgical expenses arising as a direct result of
a physically disabled person's handicap.



10123.3.  (a) No self-insured employee welfare benefit plan shall
refuse to enroll any person or accept any person as a subscriber or
renew any person as a subscriber after appropriate application on the
basis of a person's genetic characteristics that may, under some
circumstances, be associated with disability in that person or that
person's offspring.  No plan shall require a higher rate or charge,
or offer or provide different terms, conditions, or benefits, on the
basis of a person's genetic characteristics that may, under some
circumstances, be associated with disability in that person or that
person's offspring than is at the time required of any other
individual in an otherwise identical classification, nor shall any
plan make or require any rebate, discrimination, or discount upon the
amount to be paid or the service to be rendered under the plan
because the person carries those traits.
   (b) No self-insured employee welfare benefit plan shall seek
information about a person's genetic characteristics for any
nontherapeutic purpose.
   (c) No discrimination shall be made in the fees or commissions of
a solicitor or solicitor firm for an enrollment or a subscription or
the renewal of an enrollment or subscription of any person on the
basis of a person's genetic characteristics that may, under some
circumstances, be associated with disability in that person or that
person's offspring.
   (d) "Genetic characteristics" as used in this section means either
of the following:
   (1) Any scientifically or medically identifiable gene or
chromosome, or combination or alteration thereof, that is known to be
a cause of a disease or disorder in a person or his or her
offspring, or that is determined to be associated with a
statistically increased risk of development of a disease or disorder,
and that is presently not associated with any symptoms of any
disease or disorder.
   (2) Inherited characteristics that may derive from the individual
or family member, that are known to be a cause of a disease or
disorder in a person or his or her offspring, or that are determined
to be associated with a statistically increased risk of development
of a disease or disorder, and that are presently not associated with
any symptoms of any disease or disorder.



10123.31.  (a) In addition to any other remedy permitted by law, the
commissioner shall have the administrative authority to assess
penalties specified in this section against self-insured employee
welfare benefit plans engaged in the business of health insurance for
violations of Section 10123.3.
   (b) Any plan that violates Section 10123.3 is liable for
administrative penalties of not more than two thousand five hundred
dollars (,500) for the first violation and not more than five
thousand dollars (,000) for each subsequent violation.
   (c) Any plan that violates Section 10123.3 with a frequency that
indicates a general business practice or commits a knowing violation
of that section, is liable for administrative penalties of not less
than fifteen thousand dollars (,000) and not more than one hundred
thousand dollars (0,000) for each violation.
   (d) An act or omission that is inadvertent and that results in
incorrect rates being charged to more than one subscriber shall be a
single violation for the purpose of this section.



10123.35.  (a) This section shall apply to the disclosure of genetic
test results contained in an applicant or enrollee's medical records
by a self-insured welfare benefit plan.
   (b) Any person who negligently discloses results of a test for a
genetic characteristic to any third party in a manner that identifies
or provides identifying characteristics of the person to whom the
test results apply, except pursuant to a written authorization as
described in subdivision (g), shall be assessed a civil penalty in an
amount not to exceed one thousand dollars (,000) plus court costs,
as determined by the court, which penalty and costs shall be paid to
the subject of the test.
   (c) Any person who willfully discloses the results of a test for a
genetic characteristic to any third party in a manner that
identifies or provides identifying characteristics of the person to
whom the test results apply, except pursuant to a written
authorization as described in subdivision (g), shall be assessed a
civil penalty in an amount not less than one thousand dollars
(,000) and no more than five thousand dollars (,000) plus court
costs, as determined by the court, which penalty and costs shall be
paid to the subject of the test.
   (d) Any person who willfully or negligently discloses the results
of a test for a genetic characteristic to a third party in a manner
that identifies or provides identifying characteristics of the person
to whom the test results apply, except pursuant to a written
authorization as described in subdivision (g), that results in
economic, bodily, or emotional harm to the subject of the test, is
guilty of a misdemeanor punishable by a fine not to exceed ten
thousand dollars (,000).
   (e) In addition to the penalties listed in subdivisions (b) and
(c), any person who commits any act described in subdivision (b) or
(c) shall be liable to the subject for all actual damages, including
damages for economic, bodily, or emotional harm which is proximately
caused by the act.
   (f) Each disclosure made in violation of this section is a
separate and actionable offense.
   (g) The applicant's "written authorization," as used in this
section, shall satisfy the following requirements:
   (1) Is written in plain language.
   (2) Is dated and signed by the individual or a person authorized
to act on behalf of the individual.
   (3) Specifies the types of persons authorized to disclose
information about the individual.
   (4) Specifies the nature of the information authorized to be
disclosed.
   (5) States the name or functions of the persons or entities
authorized to receive the information.
   (6) Specifies the purposes for which the information is collected.

   (7) Specifies the length of time the authorization shall remain
valid.
   (8) Advises the person signing the authorization of the right to
receive a copy of the authorization.  Written authorization is
required for each separate disclosure of the test results, and the
authorization shall set forth the person or entity to whom the
disclosure would be made.
   (h) This section shall not apply to disclosures required by the
Department of Health Services necessary to monitor compliance with
Chapter 1 (commencing with Section 124975) of Part 5 of Division 106
of the Health and Safety Code, nor to disclosures required by the
Department of Managed Health Care necessary to administer and enforce
compliance with Section 1374.7 of the Health and Safety Code.



10123.36.  (a) On or before July 1, 1999, for purposes of public
disclosure, every disability insurer that covers hospital, medical,
or surgical expenses, and authorizes insureds to select providers who
have contracted with the insurer for alternative rates of payment as
described in Section 10133, and the disability insurer or any of its
contracting providers or provider groups utilize economic profiling
related to services provided to insureds, shall file with the
department a description of any policies and procedures related to
economic profiling utilized by the insurer and any of its contracting
providers and provider groups.  The filing shall describe how these
policies and procedures are used in utilization review, peer review,
incentive and penalty programs, and in provider retention and
termination decisions.  The filing shall also indicate in what
manner, if any, the economic profiling system being used takes into
consideration risk adjustments that reflect case mix, type and
severity of patient illness, age of patients, and other policyholder
characteristics that may account for higher or lower than expected
costs or utilization of services.  Any changes to the policies and
procedures shall be filed expeditiously with the commissioner.
Nothing in this section shall be construed to restrict or impair the
department, in its discretion, from utilizing the information filed
pursuant to this section for purposes of ensuring compliance with
this chapter.
   (b) The commissioner shall make each disability insurer filing
available to the public upon request.  The commissioner shall not
publicly disclose any information submitted pursuant to this section
that is determined by the commissioner to be confidential pursuant to
state law.
   (c) Each disability insurer that uses economic profiling shall,
upon request, provide a copy of economic profiling information
related to a contracting provider or provider group to the profiled
provider or group.  In addition, each disability insurer shall
require as a condition of contract that its contracting provider
groups that maintain economic profiles of individual providers who
may be selected by insureds shall, upon request, provide a copy of
individual economic profiling information to individual providers who
are profiled.  The economic profiling information provided pursuant
to this section shall be provided upon request until 60 days after
the date upon which the contract between the insurer and the
individual provider or provider group terminates, or until 60 days
after the date the contract between the provider group and the
individual provider terminates, whichever is applicable.
   (d) For the purposes of this section, "economic profiling" shall
mean any evaluation of a particular physician, provider, or provider
group based in whole or in part on the economic costs or utilization
of services associated with medical care provided or authorized by
the physician, provider, or provider group.



10123.4.  If a self-insured employee welfare benefit plan issued,
amended, or renewed in this state on or after the effective date of
this section provides in any manner for coverage for an employee and
a covered spouse dependent upon such employee, the plan shall not
provide for coverage under conditions less favorable for employees
than coverage provided for covered spouses dependent upon the
employees.
   As used in this section, "self-insured employee welfare benefit
plan" has the same meaning as that specified in subdivision (b) of
Section 10121.



10123.5.  (a) On or after January 1, 1993, every insurer issuing
group disability insurance which covers hospital, medical, or
surgical expenses shall provide benefits for the comprehensive
preventive care of children 16 years of age or younger under such
terms and conditions as may be agreed upon between the group
policyholder and the insurer.  Every insurer shall communicate the
availability of such benefits to all group policyholders and to all
prospective group policyholders with whom they are negotiating.
   (b) For purposes of this section, benefits for the comprehensive
preventive care of children shall comply with both of the following:

   (1) Be consistent with both of the following:
   (A) The Recommendations for Preventive Pediatric Health Care, as
adopted by the American Academy of Pediatrics in September of 1987.
   (B) The most current version of the Recommended Childhood
Immunization Schedule/United States, jointly adopted by the American
Academy of Pediatrics, the Advisory Committee on Immunization
Practices, and the American Academy of Family Physicians, unless the
State Department of Health Services determines, within 45 days of the
published date of the schedule, that the schedule is not consistent
with the purposes of this section.
   (2) Provide for the following:
   (A) Periodic health evaluations.
   (B) Immunizations.
   (C) Laboratory services in connection with periodic health
evaluations.



10123.55.  (a) On or after January 1, 1993, every insurer issuing
group disability insurance which covers hospital, medical, or
surgical expenses shall offer benefits for the comprehensive
preventive care of children 17 and 18 years of age under such terms
and conditions as may be agreed upon between the group policyholder
and the insurer.  Every insurer shall communicate the availability of
these benefits to all group policyholders and to all prospective
group policyholders with whom they are negotiating.
   (b) For purposes of this section, benefits for the comprehensive
preventive care of children shall comply with both of the following:

   (1) Be consistent with both of the following:
   (A) The Recommendations for Preventive Pediatric Health Care, as
adopted by the American Academy of Pediatrics in September of 1987.
   (B) The most current version of the Recommended Childhood
Immunization Schedule/United States, jointly adopted by the American
Academy of Pediatrics, the Advisory Committee on Immunization
Practices, and the American Academy of Family Physicians, unless the
State Department of Health Services determines, within 45 days of the
published date of the schedule, that the schedule is not consistent
with the purposes of this section.
   (2) Provide for the following:
   (A) Periodic health evaluations.
   (B) Immunizations.
   (C) Laboratory services in connection with periodic health
evaluations.



10123.6.  On and after January 1, 1990, every insurer issuing group
disability insurance which covers hospital, medical, or surgical
expenses shall offer coverage for the treatment of alcoholism under
such terms and conditions as may be agreed upon between the group
policyholder and the insurer.  Every insurer shall communicate the
availability of such coverage to all group policyholders and to all
prospective group policyholders with whom they are negotiating.
   If the group subscriber or policyholder agrees to such coverage or
to coverage for treatment of chemical dependency, or nicotine use,
the treatment may take place in facilities licensed to provide
alcoholism or chemical dependency services under Chapter 2
(commencing with Section 1250) of Division 2 of the Health and Safety
Code.
   Treatment for nicotine use may be subject to separate deductibles,
copayments, and overall cost limitations as determined by the
policy.


10123.67.  (a) On or before July 1, 1997, every disability insurer
that covers hospital, medical, or surgical expenses, as described in
subdivision (b), shall file with the department a written policy,
which is not subject to approval or disapproval by the department,
describing the manner in which the insurer determines if a second
medical opinion is medically necessary and appropriate.  Notice of
the policy and information regarding the manner in which an insured
may receive a second medical opinion shall be provided to all
insureds in the insurer's evidence of coverage.  The written policy
shall describe the manner in which requests for a second medical
opinion are reviewed by the insurer.
   (b) This section shall only apply to disability insurers covering
hospital, medical, or surgical expenses that contract with providers
for alternative rates pursuant to Section 10133 or 11512 and that
limit payments under those policies to services secured by insureds
from providers charging alternative rates pursuant to the contracts.

   (c) Nothing in this section shall require the disability insurer
to cover services or provide benefits that are not otherwise covered
under the terms and conditions of the plan contract, nor to provide
services through providers who are not under contract with the plan.



10123.68.  (a) When requested by an insured or contracting health
professional who is treating an insured, a disability insurer that
covers hospital, medical, or surgical expenses shall authorize a
second opinion by an appropriately qualified health care
professional.  Reasons for a second opinion to be provided or
authorized shall include, but are not limited to, the following:
   (1) If the insured questions the reasonableness or necessity of
recommended surgical procedures.
   (2) If the insured questions a diagnosis or plan of care for a
condition that threatens loss of life, loss of limb, loss of bodily
function, or substantial impairment, including, but not limited to, a
serious chronic condition.
   (3) If clinical indications are not clear or are complex and
confusing, a diagnosis is in doubt due to conflicting test results,
or the treating health professional is unable to diagnose the
condition and the insured requests an additional diagnosis.
   (4) If the treatment plan in progress is not improving the medical
condition of the insured within an appropriate period of time given
the diagnosis and plan of care, and the insured requests a second
opinion regarding the diagnosis or continuance of the treatment.
   (5) If the insured has attempted to follow the plan of care or
consulted with the initial provider concerning serious concerns about
the diagnosis or plan of care.
   (b) For purposes of this section, an appropriately qualified
health care professional is a primary care physician or a specialist
who is acting within his or her scope of practice and who possesses a
clinical background, including training and expertise, related to
the particular illness, disease, condition or conditions associated
with the request for a second opinion.
   (c) If an insured or participating health professional who is
treating an insured requests a second opinion pursuant to this
section, an authorization or denial shall be provided in an
expeditious manner.  When the insured's condition is such that the
insured faces an imminent and serious threat to his or her health,
including, but not limited to, the potential loss of life, limb, or
other major bodily function, or lack of timeliness that would be
detrimental to the insured's life or health or could jeopardize the
insured's ability to regain maximum function, the second opinion
shall be rendered in a timely fashion appropriate to the nature of
the insured's condition, not to exceed 72 hours after the insurer's
receipt of the request, whenever possible.  Each insurer shall file
with the Department of Insurance timelines for responding to requests
for second opinions for cases involving emergency needs, urgent
care, and other requests by July 1, 2000, and within 30 days of any
amendment to the timelines.  The timelines shall be made available to
the public upon request.
   (d) If an insurer approves a request by an insured for a second
opinion, the insured shall be responsible only for the costs of
applicable copayments that the insurer requires for similar
referrals.
   (e) If the insured is requesting a second opinion about care from
his or her primary care physician, the second opinion shall be
provided by an appropriately qualified health care professional of
the insured's choice who is contracted with the insurer.
   (f) If the insured is requesting a second opinion about care from
a specialist, the second opinion shall be provided by any provider of
the same or equivalent specialty, of the insured's choice, within
the insurer's provider network, if the insurance contract limits
second opinions to within a network.
   (g) The insurer may limit second opinions to its network of
providers if the insurance contract limits the benefit to within a
network of providers and there is a participating provider who meets
the standard specified in subdivision (b).  If there is no
participating provider who meets this standard, then the insurer
shall authorize a second opinion by an appropriately qualified health
professional outside of the insurer's provider network.  In
approving a second opinion either inside or outside of the insurer's
provider network, the insurer shall take into account the ability of
the insured to travel to the provider.
   (h) The insurer shall require the second opinion health
professional to provide the insured and the initial health
professional with a consultation report, including any recommended
procedures or tests that the second opinion health professional
believes appropriate.  Nothing in this section shall be construed to
prevent the insurer from authorizing, based on its independent
determination, additional medical opinions concerning the medical
condition of an insured.
   (i) If the insurer denies a request by an insured for a second
opinion, it shall notify the insured in writing of the reasons for
the denial and shall inform the insured of the right to dispute the
denial, and the procedures for exercising that right.
   (j) If the insurance contract limits health care services to
within a network of providers, in order for coverage to be in force,
the insured shall obtain services only from a provider who is
participating in, or under contract with, the insurer pursuant to the
specific insurance contract under which the insured is entitled to
health care service benefits.
   (k) This section shall not apply to any policy or contract of
disability insurance that covers hospital, medical, or surgical
expenses and that does not limit second opinions, subject to all
other terms and conditions of the contract.
   (l) This section shall not apply to accident-only, specified
disease, or hospital indemnity health insurance policies.



10123.7.  (a) On or after January 1, 1986, every insurer issuing
group health insurance shall offer coverage for orthotic and
prosthetic devices and services under the terms and conditions that
may be agreed upon between the group policyholder and the insurer.
Every insurer shall communicate the availability of that coverage to
all group policyholders and to all prospective group policyholders
with whom they are negotiating. Any coverage for prosthetic devices
shall include original and replacement devices, as prescribed by a
physician and surgeon or doctor of podiatric medicine acting within
the scope of his or her license. Any coverage for orthotic devices
shall provide for coverage when the device, including original and
replacement devices, is prescribed by a physician and surgeon or
doctor of podiatric medicine acting within the scope of his or her
license, or is ordered by a licensed health care provider acting
within the scope of his or her license. Every insurer shall have the
right to conduct a utilization review to determine medical necessity
prior to authorizing these services.
   (b) Notwithstanding subdivision (a), on and after July 1, 2007,
the amount of the benefit for orthotic and prosthetic devices and
services shall be no less than the annual and lifetime benefit
maximums applicable to all benefits in the policy. Any copayment,
coinsurance, deductible, and maximum out-of-pocket amount applied to
the benefit for orthotic and prosthetic devices and services shall be
no more than the most common amounts contained in the policy.
   (c) This section shall not apply to Medicare supplement,
short-term limited duration health insurance, vision-only,
dental-only, or CHAMPUS supplement insurance, or to hospital
indemnity, hospital-only, accident-only, or specified disease
insurance that does not pay benefits on a fixed benefit, cash payment
only basis.


10123.8.  (a) Every policy of disability insurance that provides
coverage for hospital, medical, or surgical expenses, that is issued,
amended, delivered, or renewed on or after January 1, 2000, shall
provide coverage for screening for, diagnosis of, and treatment for,
breast cancer.
   (b) No policy of disability insurance that provides coverage for
hospital, medical, or surgical expenses shall deny enrollment or
coverage to an individual solely due to a family history of breast
cancer, or who has had one or more diagnostic procedures for breast
disease but has not developed or been diagnosed with breast cancer.
   (c) Every policy of disability insurance shall cover screening and
diagnosis of breast cancer, consistent with generally accepted
medical practice and scientific evidence, upon the referral of the
insured's participating physician.
   (d) Treatment for breast cancer under this section shall include
coverage for prosthetic devices or reconstructive surgery to restore
and achieve symmetry for the patient incident to a mastectomy.
Coverage for prosthetic devices and reconstructive surgery shall be
subject to the deductible and coinsurance conditions applied to the
mastectomy and all other terms and conditions applicable to other
benefits.
   (e) As used in this section, "mastectomy" means the removal of all
or part of the breast for medically necessary reasons, as determined
by a licensed physician and surgeon.
   (f) As used in this section, "prosthetic devices" means the
provision of initial and subsequent devices pursuant to an order of
the patient's physician and surgeon.
   (g) For purposes of this section, disability insurance does not
include accident only, credit, disability income, specified disease
and hospital confinement indemnity, coverage of Medicare services
pursuant to contracts with the United States government, Medicare
supplement, long-term care insurance, 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.


10123.81.  On or after January 1, 2000, every individual or group
policy of disability insurance or self-insured employee welfare
benefit plan that is issued, amended, or renewed, shall be deemed to
provide coverage for at least the following, upon the referral of a
nurse practitioner, certified nurse midwife, or physician, providing
care to the patient and operating within the scope of practice
provided under existing law for breast cancer screening or diagnostic
purposes:
   (a) A baseline mammogram for women age 35 to 39, inclusive.
   (b) A mammogram for women age 40 to 49, inclusive, every two years
or more frequently based on the women's physician's recommendation.

   (c) A mammogram every year for women age 50 and over.
   Nothing in this section shall be construed to require an
individual or group policy to cover the surgical procedure known as
mastectomy or to prevent application of deductible or copayment
provisions contained in the policy or plan, nor shall this section be
construed to require that coverage under an individual or group
policy be extended to any other procedures.
   Nothing in this section shall be construed to authorize an insured
or plan member to receive the coverage required by this section if
that coverage is furnished by a nonparticipating provider, unless the
insured or plan member is referred to that provider by a
participating physician, nurse practitioner, or certified nurse
midwife providing care.



10123.82.  Every policy of disability insurance which provides for
the surgical procedure known as a laryngectomy and which is issued,
amended, delivered, or renewed in this state on or after January 1,
1993, shall include coverage for prosthetic devices to restore a
method of speaking for the patient incident to the laryngectomy.
   Coverage for prosthetic devices shall be subject to the deductible
and coinsurance conditions applied to the laryngectomy, and all
other terms and conditions applicable to other benefits.  As used in
this section, "laryngectomy" means the removal of the larynx for
medically necessary reasons, as determined by a licensed physician
and surgeon.
   Any provision in any policy issued, amended, delivered, or renewed
in this state on or after January 1, 1993, which is in conflict with
this section shall be of no force or effect.
   As used in this section, "prosthetic devices" means and includes
the provision of initial and subsequent prosthetic devices, including
installation accessories, pursuant to an order of the patient's
physician and surgeon.  "Prosthetic devices" does not include
electronic voice producing machines.



10123.83.  (a) On or after January 1, 1995, every policy of
disability insurance that covers hospital, medical, or surgical
expenses and is issued, amended, delivered, or renewed in this state
shall include obstetrician-gynecologists as eligible primary care
physicians provided they meet the insurer's written eligibility
criteria for all specialists seeking primary care physician status.
   (b) For purposes of this section, the term "primary care physician"
means a physician, as defined in Section 14254 of the Welfare and
Institutions Code, who has the responsibility for providing initial
and primary care to patients, for maintaining the continuity of
patient care, and for initiating referral for specialist care.  This
means providing care for the majority of health care problems,
including, but not limited to, preventive services, acute and chronic
conditions, and psychosocial issues.



10123.83.  (a) Every individual or group policy of disability
insurance that covers hospital, medical, or surgical benefits that is
issued, amended, or renewed on or after January 1, 1999, shall be
deemed to provide coverage for the screening and diagnosis of
prostate cancer, including, but not limited to, prostate-specific
antigen testing and digital rectal examinations, when medically
necessary and consistent with good professional practice.
   (b) Nothing in this section shall be construed to require an
individual or group policy to cover the surgical and other procedures
known as radical prostatectomy, external beam radiation therapy,
radiation seed implants, and combined hormonal therapy, or to prevent
application of deductible or copayment provisions contained in the
policy, nor shall this section be construed to require that coverage
under an individual or group policy be extended to any other
procedures.
   (c) This section shall not apply to specified accident, specified
disease, hospital indemnity, Medicare supplement, or long-term care
health insurance policies.



10123.84.  (a) The Legislature finds and declares that the unique,
private, and personal relationship between women patients and their
obstetricians and gynecologists warrants direct access to obstetrical
and gynecological physician services.
   (b) Commencing January 1, 1999, every policy of disability
insurance that covers hospital, medical, or surgical expenses, and
that is issued, amended, delivered, or renewed in this state, shall
allow a policyholder the option to seek obstetrical and gynecological
physician services directly from an obstetrician and gynecologist or
directly from a participating family practice physician and surgeon
designated by the plan as providing obstetrical and gynecological
services.
   (c) In implementing this section, a disability insurer may
establish reasonable provisions governing utilization protocols and
the use of obstetricians and gynecologists or family practice
physicians and surgeons, as provided for in subdivision (b), provided
that these provisions shall be consistent with the intent of this
section and shall be those customarily applied to other physicians
and surgeons, including primary care physicians and surgeons, to whom
the policyholder has direct access, and shall not be more
restrictive for the provision of obstetrical and gynecological
physician services.  A policyholder shall not be required to obtain
prior approval from another physician, another provider, or the
insurer prior to obtaining direct access to obstetrical and
gynecological physician services, but the insurer may establish
reasonable requirements for the participating obstetrician and
gynecologist or the family practice physician and surgeon, as
provided in subdivision (b), to communicate with the policyholder's
primary care physician regarding the policyholder's condition,
treatment, and any need for followup care.
   (d) This section shall not be construed to diminish the provisions
of Section 10123.83.
   (e) The Insurance Commissioner shall report to the Legislature, on
or before January 1, 2000, on the implementation of this section.




10123.85.  (a) It is the intent of the Legislature to recognize the
practice of telemedicine as a legitimate means by which an individual
may receive medical services from a health care provider without
person-to-person contact with the provider.
   (b) For the purposes of this section, the meaning of "telemedicine"
is as defined in subdivision (a) of Section 2290.5 of the Business
and Professions Code.
   (c) On and after January 1, 1997, no disability insurance contract
that is issued, amended, or renewed for hospital, medical, or
surgical coverage shall require face-to-face contact between a health
care provider and a patient for services appropriately provided
through telemedicine, subject to all terms and conditions of the
contract agreed upon between the policyholder or contractholder and
the insurer.
   (d) Disability insurers shall not be required to pay for
consultation provided by the health care provider by telephone or
facsimile machines.



10123.86.  (a) Every policy of disability insurance covering
hospital, surgical, or medical expenses that is issued, amended,
renewed, or delivered on or after January 1, 1999, that provides
coverage for surgical procedures known as mastectomies and lymph node
dissections, shall do all of the following:
   (1) Allow the length of a hospital stay associated with those
procedures to be determined by the attending physician and surgeon in
consultation with the patient, consistent with sound clinical
principles and processes.  No disability insurer shall require a
treating physician and surgeon to receive prior approval in
determining the length of hospital stay following those procedures.
   (2) Cover prosthetic devices or reconstructive surgery, including
devices or surgery to restore and achieve symmetry for the patient
incident to the mastectomy.  Coverage for prosthetic devices and
reconstructive surgery shall be subject to the deductible and
coinsurance conditions applicable to other benefits.
   (3) Cover all complications from a mastectomy, including
lymphedema.
   (b) As used in this section, all of the following definitions
apply:
   (1) "Coverage for prosthetic devices or reconstructive surgery"
means any initial and subsequent reconstructive surgeries or
prosthetic devices, and followup care deemed necessary by the
attending physician and surgeon.
   (2) "Prosthetic devices" means and includes the provision of
initial and subsequent prosthetic devices pursuant to an order of the
patient's physician and surgeon.
   (3) "Mastectomy" shall have the same meaning as in Section
10123.8.
   (4) "To restore and achieve symmetry" means that, in addition to
coverage of prosthetic devices and reconstructive surgery for the
diseased breast on which the mastectomy was performed, prosthetic
devices and reconstructive surgery for a healthy breast is also
covered if, in the opinion of the attending physician and surgeon,
this surgery is necessary to achieve normal symmetrical appearance.
   (c) No individual, other than a licensed physician and surgeon
competent to evaluate the specific clinical issues involved in the
care requested, may deny requests for authorization of health care
services pursuant to this section.
   (d) No insurer shall do any of the following in providing the
coverage described in subdivision (a):
   (1) Reduce or limit the reimbursement of the attending provider
for providing care to an insured in accordance with the coverage
requirements.
   (2) Provide monetary or other incentives to an attending provider
to induce the provider to provide care to an insured in a manner
inconsistent with the coverage requirements.
   (3) Provide monetary payments or rebates to an insured to
encourage acceptance of less than the coverage requirements.
   (e) On or after July 1, 1999, every insurer shall include notice
of the coverage required by this section in the insurer's evidence of
coverage or certificate of insurance.
   (f) Nothing in this section shall be construed to limit
retrospective utilization review and quality assurance activities by
the insurer.
   (g) This section shall only apply to health benefit plans, as
defined in subdivision (a) of Section 10198.6, except that for
accident only, specified disease, or hospital indemnity insurance,
coverage for benefits under this section shall apply to the extent
that the benefits are covered under the general terms and conditions
that apply to all other benefits under the policy.  Nothing in this
section shall be construed as imposing a new benefit mandate on
accident only, specified disease, or hospital indemnity insurance.




10123.87.  (a) No individual or group policy of disability insurance
that provides coverage for hospital, medical, and surgical benefits
that is issued, amended, renewed, or delivered on or after the
effective date of the act adding this section, that provides
maternity coverage, shall do any of the following:
   (1) Restrict benefits for inpatient hospital care to a time period
less than 48 hours following a normal vaginal delivery and less than
96 hours following a delivery by caesarean section.  However,
coverage for inpatient hospital care may be for a time period less
than 48 or 96 hours if both of the following conditions are met:
   (A) The decision to discharge the mother and newborn before the
48- or 96-hour time period is made by the treating physicians in
consultation with the mother.
   (B) The policy covers a postdischarge followup visit for the
mother and newborn within 48 hours of discharge, when prescribed by
the treating physician.  The visit shall be provided by a licensed
health care provider whose scope of practice includes postpartum care
and newborn care.  The visit shall include, at a minimum, parent
education, assistance and training in breast or bottle feeding, and
the performance of any necessary maternal or neonatal physical
assessments.  The treating physician shall disclose to the mother the
availability of a postdischarge visit, including an in-home visit,
physician office visit, or a visit to a facility under contract with
the insurer.  The treating physician, in consultation with the
mother, shall determine whether the postdischarge visit shall occur
at home, the contracted facility, or the treating physician's office
after assessment of certain factors.  These factors shall include,
but not be limited to, the transportation needs of the family, and
environmental and social risks.
   (2) Reduce or limit the reimbursement of the attending provider
for providing care to an individual insured in accordance with the
coverage requirements.
   (3) Provide monetary or other incentives to an attending provider
to induce the provider to provide care to an individual insured in a
manner inconsistent with the coverage requirements.
   (4) Deny a mother or her newborn eligibility, or continued
eligibility, to enroll or to renew coverage solely to avoid the
coverage requirements.
   (5) Provide monetary payments or rebates to a mother to encourage
her to accept less than the minimum coverage requirements.
   (6) Restrict inpatient benefits for the second day of hospital
care in a manner that is less than favorable to the mother or her
newborn than those provided during the preceding portion of the
hospital stay.
   (7) Require the treating physician to obtain authorization from
the insurer prior to prescribing any services covered by this
section.
   (b) (1) Every individual or group policy of disability insurance
that provides coverage for hospital, medical, and surgical benefits
shall include notice of the coverage specified in subdivision (a) in
the insurer's evidence of coverage or certificate of insurance for
evidences of coverage or certificates of insurance issued on or after
January 1, 1998.
   (2) Every insurer that issues a policy of disability insurance
under paragraph (1) shall provide additional written notice to all
females between the ages of 10 and 50 who are covered under those
policies of the coverage under subdivision (a) within 60 days of the
effective date of this act.  The insurer shall provide additional
written notice of the coverage specified in subdivision (a) during
the course of prenatal care if both of the following conditions are
met:
   (A) The insurer previously notified policyholders that hospital
stays for delivery would be inconsistent with the requirement in
subparagraph (A) of paragraph (1) of subdivision (a).
   (B) The insurer received notice, whether by receipt of a claim, a
request for preauthorization for pregnancy-related services, or other
actual notice that the insured is pregnant.
   (c) Nothing in this section shall be construed to prohibit an
insurer from negotiating the level and type of reimbursement with a
provider for care provided in accordance with this section.




10123.88.  (a) Every policy of disability insurance covering
hospital, medical, or surgical expenses that is issued, amended,
renewed, or delivered in this state on or after July 1, 1999, shall
cover reconstructive surgery, as defined in subdivision (c), that is
necessary to achieve the purposes specified in paragraphs (1) or (2)
of subdivision (c).  Nothing in this section shall be construed to
require a policy to provide coverage for cosmetic surgery, as defined
in subdivision (d).  This section shall only apply to health benefit
plans, as defined in subdivision (a) of Section 10198.6, except that
for accident only, specified disease, or hospital indemnity
insurance, coverage for benefits under this section shall apply to
the extent that the benefits are covered under the general terms and
conditions that apply to all other benefits under the policy.
Nothing in this section shall be construed as imposing a new benefit
mandate on accident only, specified disease, or hospital indemnity
insurance.
   (b) No individual, other than a licensed physician competent to
evaluate the specific clinical issues involved in the care requested,
may deny initial requests for authorization of coverage for
treatment pursuant to this section.  For a treatment authorization
request submitted by a podiatrist or an oral and maxillofacial
surgeon, the request may be reviewed by a similarly licensed
individual, competent to evaluate the specific clinical issues
involved in the care requested.
   (c) "Reconstructive surgery" means surgery performed to correct or
repair abnormal structures of the body caused by congenital defects,
developmental abnormalities, trauma, infection, tumors, or disease
to do either of the following:
   (1) To improve function.
   (2) To create a normal appearance, to the extent possible.
   (d) Nothing in this section shall be construed to require an
insurer to provide coverage for cosmetic surgery.  "Cosmetic surgery"
means surgery that is performed to alter or reshape normal
structures of the body in order to improve the patient's appearance.

   (e) In interpreting the definition of reconstructive surgery, an
insurer may utilize prior authorization and utilization review that
may include, but need not be limited to, any of the following:
   (1) Denial of the proposed surgery if there is another more
appropriate surgical procedure that will be approved for the
enrollee.
   (2) Denial of the proposed surgery or surgeries if the procedure
or procedures, in accordance with the standard of care as practiced
by physicians specializing in reconstructive surgery, offer only a
minimal improvement in the appearance of the enrollee.
   (3) Denial of payment for procedures performed without prior
authorization.


10123.89.  (a) On and after July 1, 2000, every policy of disability
insurance issued, amended, delivered, or renewed in this state that
provides coverage for hospital, medical, or surgical expenses shall
provide coverage for the testing and treatment of phenylketonuria
(PKU) under the terms and conditions of the policy.
   (b) Coverage for treatment of phenylketonuria (PKU) shall include
those formulas and special food products that are part of a diet
prescribed by a licensed physician and managed by a health care
professional in consultation with a physician who specializes in the
treatment of metabolic disease and who participates in or is
authorized by the insurer, provided that the diet is deemed medically
necessary to avert the development of serious physical or mental
disabilities or to promote normal development or function as a
consequence of phenylketonuria (PKU).
   (c) Coverage pursuant to this section is not required except to
the extent that the cost of necessary formulas and special food
products exceeds the cost of a normal diet.
   (d) For purposes of this section, the following definitions shall
apply:
   (1) "Formula" means an enteral product or enteral products for use
at home that are prescribed by a physician or nurse practitioner, or
ordered by a registered dietician upon referral by a health care
provider authorized to prescribe dietary treatments, as medically
necessary for the treatment of phenylketonuria (PKU).
   (2) "Special food product" means a food product that is both of
the following:
   (A) Prescribed by a physician or nurse practitioner for the
treatment of phenylketonuria (PKU) and is consistent with the
recommendations and best practices of qualified health professionals
with expertise germane to, and experience in the treatment and care
of, phenylketonuria (PKU).  It does not include a food that is
naturally low in protein, but may include a food product that is
specially formulated to have less than one gram of protein per
serving.
   (B) Used in place of normal food products, such as grocery store
foods, used by the general population.
   (e) This section shall not apply to vision-only, dental-only,
accident-only, specified disease, hospital indemnity, Medicare
supplement, long-term care, or disability income insurance, except
that for accident only, specified disease, or hospital indemnity
coverage, coverage for benefits under this section shall apply to the
extent that the benefits are covered under the general terms and
conditions that apply to all other benefits under the policy or
contract.  Nothing in this section shall be construed as imposing a
new benefit mandate on accident only, specified disease, or hospital
indemnity insurance.



10123.9.  On and after January 1, 1980, every group policy of
disability insurance which covers hospital, medical, or surgical
expenses on a group basis, and which offers maternity coverage in
such groups, shall also offer coverage for prenatal diagnosis of
genetic disorders of the fetus by means of diagnostic procedures in
cases of high-risk pregnancy.  Such coverage shall be offered under
such terms and conditions as may be agreed upon between the insurer
and the group policyholder.  Every group policy of disability
insurance shall communicate the availability of such coverage to all
group policyholders and to all groups with whom they are negotiating.




10123.10.  (a) Every disability insurer transacting business in this
state shall, on or after January 1, 1979, make available and offer
to include in every group disability policy providing hospital,
medical or surgical expense benefits payable on an expense incurred
basis, to be delivered or issued for delivery in this state, benefits
for home health care as set forth in this section provided by a
licensed home health agency subject to the right of the group
policyholder to reject the benefits or to select any alternative
level of benefits as may be offered by the insurer.
   In rural areas where there are no licensed health agencies or in
which the supply of home health agency services does not meet the
needs of the community, the services of visiting nurses, if
available, may be substituted for the services of the home health
agency, subject to the terms and conditions set forth in subdivision
(c).
   (b) Every self-insured employee welfare benefit plan containing
hospital, medical, or surgical expense benefits or service benefits
delivered on or after January 1, 1979, shall make available and offer
to include benefits for home health care as set forth in this
section provided by a licensed home health agency subject to the
right of the employer or the employee organization to reject the
benefits or accept any alternative level of benefits as may be
offered by the self-insured welfare benefit plan.
   In rural areas where there are no licensed health agencies or in
which the supply of home health agency services does not meet the
needs of the community, the services of visiting nurses, if
available, may be substituted for the services of the home health
agency, subject to the terms and conditions set forth in subdivision
(c).
   (c) As used in this section:
   (1) "Home health care" means the continued care and treatment of
an insured person who is under the direct care and supervision of a
physician but only if  (i) continued hospitalization would have been
required if home health care were not provided, (ii) the home health
treatment plan is established and approved by a physician within 14
days after an inpatient hospital confinement has ended and such
treatment plan is for the same or related condition for which the
insured person was hospitalized, and (iii) home health care commences
within 14 days after the hospital confinement has ended.  "Home
health services" consist of, but shall not be limited to, the
following:  (i) part-time or intermittent skilled nursing services
provided by a registered nurse or licensed vocational nurse; (ii)
part-time or intermitent home health aide services which provide
supportive services in the home under the supervision of a registered
nurse or a physical, speech or occupational therapist; (iii)
physical, occupational or speech therapy; and (iv) medical supplies,
drugs and medicines prescribed by a physician and related
pharmaceutical services, and laboratory services to the extent such
charges or costs would have been covered under the policy if the
insured person had remained in the hospital.
   (2) "Home health agency" means a public or private agency or
organization licensed by the State Department of Health Services in
accordance with the provisions of Chapter 8 (commencing with Section
1725) of Division 2 of the Health and Safety Code.
   (d) The policy may contain a limitation on the number of home
health visits for which benefits are payable, but the number of such
visits shall not be less than 100 in any calendar year or in any
continuous 12-month period for each person covered under the policy.
Except for a home health aide, each visit by a representative of a
home health agency shall be considered as one home health visit.  A
visit of four hours or less by a home health aide shall be considered
as one home health visit.
   (e) Home health care benefits may be subject to an annual
deductible of not more than fifty dollars () for each person
covered under a policy, and may be subject to a coinsurance provision
which provides coverage of not less than 80 percent of the
reasonable charges for such services.
   (f) Nothing in this section shall preclude an insurer or plan
offering other health care benefits provided in the home.



10123.11.  (a) No insurer shall deny a claim under a group
disability policy for hospital, medical, surgical, dental, or
optometric services for the sole reason that the individual served
was confined in a city or county jail as a prisoner, or was a
juvenile detained in any facility if such individual is otherwise
entitled to benefits under such group disability policy and incurs
expense for the services so provided during confinement.  This
provision shall apply to any group disability policy entered into or
renewed on or after July 1, 1980, whether or not such policy contains
any provision terminating benefits under such policy upon an
individual's confinement in a city or county jail or juvenile
detention facility.
   (b) No self-insured employee welfare benefit plan shall deny a
claim under a plan for hospital, medical, surgical, dental, or
optometric services for the reason that the individual served was
confined in a city or county jail as a prisoner, or was a juvenile
detained in any facility, if such individual is otherwise entitled to
benefits under such plan and incurs expense for the services so
provided during confinement.  This provision shall apply to any
self-insured employee welfare benefit plan entered into or renewed on
or after July 1, 1980, whether or not such plan contains any
provision terminating benefits under such plan upon an individual's
confinement in a city or county jail or juvenile detention facility.




10123.12.  Every health insurer, including those insurers that
contract for alternative rates of payment pursuant to Section 10133,
and every self-insured employee welfare benefit plan that will affect
the choice of physician, hospital, or other health care providers
shall include within its disclosure form and within its evidence or
certificate of coverage a statement clearly describing how
participation in the policy or plan may affect the choice of
physician, hospital, or other health care providers, and describing
the nature and extent of the financial liability that is, or that may
be, incurred by the insured, enrollee, or covered dependents if care
is furnished by a provider that does not have a contract with the
insurer or plan to provide service at alternative rates of payment
pursuant to Section 10133. The form shall clearly inform prospective
insureds or plan enrollees that participation in the policy or plan
will affect the person's choice in this regard by placing the
following statement in a conspicuous place on all material required
to be given to prospective insureds or plan enrollees including
promotional and descriptive material, disclosure forms, and
certificates and evidences of coverage:
      PLEASE READ THE FOLLOWING INFORMATION SO YOU WILL KNOW FROM
WHOM OR WHAT GROUP OF PROVIDERS HEALTH CARE MAY BE OBTAINED

   It is not the intent of this section to require that the names of
individual health care providers be enumerated to prospective
insureds or enrollees.
   If a health insurer providing coverage for hospital, medical, or
surgical expenses provides a list of facilities to patients or
contracting providers, the insurer shall include within the provider
listing a notification that insureds or enrollees may contact the
insurer in order to obtain a list of the facilities with which the
health insurer is contracting for subacute care and/or transitional
inpatient care.



10123.13.  (a) Every insurer issuing group or individual policies of
health insurance that covers hospital, medical, or surgical
expenses, including those telemedicine services covered by the
insurer as defined in subdivision (a) of Section 2290.5 of the
Business and Professions Code, shall reimburse claims or any portion
of any claim, whether in state or out of state, for those expenses as
soon as practical, but no later than 30 working days after receipt
of the claim by the insurer unless the claim or portion thereof is
contested by the insurer, in which case the claimant shall be
notified, in writing, that the claim is contested or denied, within
30 working days after receipt of the claim by the insurer. The notice
that a claim is being contested or denied shall identify the portion
of the claim that is contested or denied and the specific reasons
including for each reason the factual and legal basis known at that
time by the insurer for contesting or denying the claim. If the
reason is based solely on facts or solely on law, the insurer is
required to provide only the factual or the legal basis for its
reason for contesting or denying the claim.  The insurer shall
provide a copy of the notice to each insured who received services
pursuant to the claim that was contested or denied and to the insured'
s health care provider that provided the services at issue. The
notice shall advise the provider who submitted the claim on behalf of
the insured or pursuant to a contract for alternative rates of
payment and the insured that either may seek review by the department
of a claim that the insurer contested or denied, and the notice
shall include the address, Internet Web site address, and telephone
number of the unit within the department that performs this review
function. The notice to the provider may be included on either the
explanation of benefits or remittance advice and shall also contain a
statement advising the provider of its right to enter into the
dispute resolution process described in Section 10123.137. The notice
to the insured may also be included on the explanation of benefits.

   (b) If an uncontested claim is not reimbursed by delivery to the
claimant's address of record within 30 working days after receipt,
interest shall accrue and shall be payable at the rate of 10 percent
per annum beginning with the first calendar day after the 30-working
day period.
   (c) For purposes of this section, a claim, or portion thereof, is
reasonably contested when the insurer has not received a completed
claim and all information necessary to determine payer liability for
the claim, or has not been granted reasonable access to information
concerning provider services. Information necessary to determine
liability for the claims includes, but is not limited to, reports of
investigations concerning fraud and misrepresentation, and necessary
consents, releases, and assignments, a claim on appeal, or other
information necessary for the insurer to determine the medical
necessity for the health care services provided to the claimant. If
an insurer has received all of the information necessary to determine
payer liability for a contested claim and has not reimbursed a claim
determined to be payable within 30 working days of receipt of that
information, interest shall accrue and be payable at a rate of 10
percent per annum beginning with the first calendar day after the
30-working day period.
   (d) The obligation of the insurer to comply with this section
shall not be deemed to be waived when the insurer requires its
contracting entities to pay claims for covered services.



10123.131.  (a) An insurer shall pay a provider for duplicating all
information it requests in connection with a contested claim, and for
patient records, as follows:
   (1) Except as provided in paragraph (2), the insurer shall pay the
provider for copying twenty-five cents (.25) per page, or fifty
cents (.50) per page for records that are copied from microfilm.
   (2) The insurer shall pay the provider all reasonable costs, not
exceeding actual costs, incurred by the provider in providing the
insurer copies of X-rays, or tracings derived from
electrocardiography, electroencephalography, or electromyography.
   (b) No insurer subject to this section shall request information
that is not reasonably necessary to determine liability for payment
of a claim.
   (c) The obligation of the insurer to comply with this section
shall not be deemed to be waived when the insurer requires its
contracting entities to pay claims for covered services.
   (d) This section shall not apply to contractual arrangements
between an insurer and its agent, an insurer and a provider, or a
provider and its agent for the costs associated with the provision of
duplication services.


10123.132.  (a) Every disability insurer that covers hospital,
medical, or surgical expenses and that reviews and approves the
medical necessity or appropriateness of requests by providers prior
to, or concurrently with, the provision of health care services to
insureds, shall prominently indicate on each insured's identification
card whether a separate telephone number must be called to verify
eligibility for benefits and coverage.
   (b) A written notice shall accompany the initial mailing of the
insured's identification card modified pursuant to subdivision (a).
The notice shall indicate that the insured's identification card
includes a telephone number that may be used to verify eligibility
for benefits and coverage.  The notice shall also inform the insured
that review and approval of a health care service based on medical
necessity or appropriateness does not constitute eligibility for
benefits and coverage pursuant to the policy or contract.




10123.135.  (a) Every disability insurer, or an entity with which it
contracts for services that include utilization review or
utilization management functions, that covers hospital, medical, or
surgical expenses and that prospectively, retrospectively, or
concurrently reviews and approves, modifies, delays, or denies, based
in whole or in part on medical necessity, requests by providers
prior to, retrospectively, or concurrent with the provision of health
care services to insureds, or that delegates these functions to
medical groups or independent practice associations or to other
contracting providers, shall comply with this section.
   (b) A disability insurer that is subject to this section, or any
entity with which an insurer contracts for services that include
utilization review or utilization management functions, shall have
written policies and procedures establishing the process by which the
insurer prospectively, retrospectively, or concurrently reviews and
approves, modifies, delays, or denies, based in whole or in part on
medical necessity, requests by providers of health care services for
insureds.  These policies and procedures shall ensure that decisions
based on the medical necessity of proposed health care services are
consistent with criteria or guidelines that are supported by clinical
principles and processes.  These criteria and guidelines shall be
developed pursuant to subdivision (f).  These policies and
procedures, and a description of the process by which an insurer, or
an entity with which an insurer contracts for services that include
utilization review or utilization management functions, reviews and
approves, modifies, delays, or denies requests by providers prior to,
retrospectively, or concurrent with the provision of health care
services to insureds, shall be filed with the commissioner, and shall
be disclosed by the insurer to insureds and providers upon request,
and by the insurer to the public upon request.
   (c) If the number of insureds covered under health benefit plans
in this state that are issued by an insurer subject to this section
constitute at least 50 percent of the number of insureds covered
under health benefit plans issued nationwide by that insurer, the
insurer shall employ or designate a medical director who holds an
unrestricted license to practice medicine in this state issued
pursuant to Section 2050 of the Business and Professions Code or the
Osteopathic Initiative Act, or the insurer may employ a clinical
director licensed in California whose scope of practice under
California law includes the right to independently perform all those
services covered by the insurer.  The medical director or clinical
director shall ensure that the process by which the insurer reviews
and approves, modifies, delays, or denies, based in whole or in part
on medical necessity, requests by providers prior to,
retrospectively, or concurrent with the provision of health care
services to insureds, complies with the requirements of this section.
  Nothing in this subdivision shall be construed as restricting the
existing authority of the Medical Board of California.
   (d) If an insurer subject to this section, or individuals under
contract to the insurer to review requests by providers, approve the
provider's request pursuant to subdivision (b), the decision shall be
communicated to the provider pursuant to subdivision (h).
   (e) An individual, other than a licensed physician or a licensed
health care professional who is competent to evaluate the specific
clinical issues involved in the health care services requested by the
provider, may not deny or modify requests for authorization of
health care services for an insured for reasons of medical necessity.
  The decision of the physician or other health care provider shall
be communicated to the provider and the insured pursuant to
subdivision (h).
   (f) (1) An insurer shall disclose, or provide for the disclosure,
to the commissioner and to network providers, the process the
insurer, its contracting provider groups, or any entity with which it
contracts for services that include utilization review or
utilization management functions, uses to authorize, delay, modify,
or deny health care services under the benefits provided by the
insurance contract, including coverage for subacute care,
transitional inpatient care, or care provided in skilled nursing
facilities.  An insurer shall also disclose those processes to
policyholders or persons designated by a policyholder, or to any
other person or organization, upon request.
   (2) The criteria or guidelines used by an insurer, or an entity
with which an insurer contracts for utilization review or utilization
management functions, to determine whether to authorize, modify,
delay, or deny health care services, shall comply with all of the
following:
   (A) Be developed with involvement from actively practicing health
care providers.
   (B) Be consistent with sound clinical principles and processes.
   (C) Be evaluated, and updated if necessary, at least annually.
   (D) If used as the basis of a decision to modify, delay, or deny
services in a specified case under review, be disclosed to the
provider and the policyholder in that specified case.
   (E) Be available to the public upon request.  An insurer shall
only be required to disclose the criteria or guidelines for the
specific procedures or conditions requested.  An insurer may charge
reasonable fees to cover administrative expenses related to
disclosing criteria or guidelines pursuant to this paragraph that are
limited to copying and postage costs.  The insurer may also make the
criteria or guidelines available through electronic communication
means.
   (3) The disclosure required by subparagraph (E) of paragraph (2)
shall be accompanied by the following notice:  "The materials
provided to you are guidelines used by this insurer to authorize,
modify, or deny health care benefits for persons with similar
illnesses or conditions.  Specific care and treatment may vary
depending on individual need and the benefits covered under your
insurance contract."
   (g) If an insurer subject to this section requests medical
information from providers in order to determine whether to approve,
modify, or deny requests for authorization, the insurer shall request
only the information reasonably necessary to make the determination.

   (h) In determining whether to approve, modify, or deny requests by
providers prior to, retrospectively, or concurrent with the
provision of health care services to insureds, based in whole or in
part on medical necessity, every insurer subject to this section
shall meet the following requirements:
   (1) Decisions to approve, modify, or deny, based on medical
necessity, requests by providers prior to, or concurrent with, the
provision of health care services to insureds that do not meet the
requirements for the 72-hour review required by paragraph (2), shall
be made in a timely fashion appropriate for the nature of the insured'
s condition, not to exceed five business days from the insurer's
receipt of the information reasonably necessary and requested by the
insurer to make the determination.  In cases where the review is
retrospective, the decision shall be communicated to the individual
who received services, or to the individual's designee, within 30
days of the receipt of information that is reasonably necessary to
make this determination, and shall be communicated to the provider in
a manner that is consistent with current law.  For purposes of this
section, retrospective reviews shall be for care rendered on or after
January 1, 2000.
   (2) When the insured's condition is such that the insured faces an
imminent and serious threat to his or her health, including, but not
limited to, the potential loss of life, limb, or other major bodily
function, or the normal timeframe for the decisionmaking process, as
described in paragraph (1), would be detrimental to the insured's
life or health or could jeopardize the insured's ability to regain
maximum function, decisions to approve, modify, or deny requests by
providers prior to, or concurrent with, the provision of health care
services to insureds shall be made in a timely fashion, appropriate
for the nature of the insured's condition, but not to exceed 72 hours
after the insurer's receipt of the information reasonably necessary
and requested by the insurer to make the determination.
   (3) Decisions to approve, modify, or deny requests by providers
for authorization prior to, or concurrent with, the provision of
health care services to insureds shall be communicated to the
requesting provider within 24 hours of the decision.  Except for
concurrent review decisions pertaining to care that is underway,
which shall be communicated to the insured's treating provider within
24 hours, decisions resulting in denial, delay, or modification of
all or part of the requested health care service shall be
communicated to the insured in writing within two business days of
the decision.  In the case of concurrent review, care shall not be
discontinued until the insured's treating provider has been notified
of the insurer's decision and a care plan has been agreed upon by the
treating provider that is appropriate for the medical needs of that
patient.
   (4) Communications regarding decisions to approve requests by
providers prior to, retrospectively, or concurrent with the provision
of health care services to insureds shall specify the specific
health care service approved.  Responses regarding decisions to deny,
delay, or modify health care services requested by providers prior
to, retrospectively, or concurrent with the provision of health care
services to insureds shall be communicated to insureds in writing,
and to providers initially by telephone or facsimile, except with
regard to decisions rendered retrospectively, and then in writing,
and shall include a clear and concise explanation of the reasons for
the insurer's decision, a description of the criteria or guidelines
used, and the clinical reasons for the decisions regarding medical
necessity.  Any written communication to a physician or other health
care provider of a denial, delay, or modification or a request shall
include the name and telephone number of the health care professional
responsible for the denial, delay, or modification.  The telephone
number provided shall be a direct number or an extension, to allow
the physician or health care provider easily to contact the
professional responsible for the denial, delay, or modification.
Responses shall also include information as to how the provider or
the insured may file an appeal with the insurer or seek department
review under the unfair practices provisions of Article 6.5
(commencing with Section 790) of Chapter 1 of Part 2 of Division 1
and the regulations adopted thereunder.
   (5) If the insurer cannot make a decision to approve, modify, or
deny the request for authorization within the timeframes specified in
paragraph (1) or (2) because the insurer is not in receipt of all of
the information reasonably necessary and requested, or because the
insurer requires consultation by an expert reviewer, or because the
insurer has asked that an additional examination or test be performed
upon the insured, provided that the examination or test is
reasonable and consistent with good medical practice, the insurer
shall, immediately upon the expiration of the timeframe specified in
paragraph (1) or (2), or as soon as the insurer becomes aware that it
will not meet the timeframe, whichever occurs first, notify the
provider and the insured, in writing, that the insurer cannot make a
decision to approve, modify, or deny the request for authorization
within the required timeframe, and specify the information requested
but not received, or the expert reviewer to be consulted, or the
additional examinations or tests required.  The insurer shall also
notify the provider and enrollee of the anticipated date on which a
decision may be rendered.  Upon receipt of all information reasonably
necessary and requested by the insurer, the insurer shall approve,
modify, or deny the request for authorization within the timeframes
specified in paragraph (1) or (2), whichever applies.
   (6) If the commissioner determines that an insurer has failed to
meet any of the timeframes in this section, or has failed to meet any
other requirement of this section, the commissioner may assess, by
order, administrative penalties for each failure.  A proceeding for
the issuance of an order assessing administrative penalties shall be
subject to appropriate notice to, and an opportunity for a hearing
with regard to, the person affected.  The administrative penalties
shall not be deemed an exclusive remedy for the commissioner.  These
penalties shall be paid to the Insurance Fund.
   (i) Every insurer subject to this section shall maintain telephone
access for providers to request authorization for health care
services.
   (j) Nothing in this section shall cause a disability insurer to be
defined as a health care provider for purposes of any provision of
law, including, but not limited to, Section 6146 of the Business and
Professions Code, Sections 3333.1 and 3333.2 of the Civil Code, and
Sections 340.5, 364, 425.13, 667.7, and 1295 of the Code of Civil
Procedure.



10123.137.  (a) Each contract between a health insurer and a
provider shall contain provisions requiring a fast, fair, and
cost-effective dispute resolution mechanism under which providers may
submit disputes to the insurer, and requiring the insurer to inform
its providers, upon contracting with the insurer, or upon change to
these provisions, of the procedures for processing and resolving
disputes, including the location and telephone number where
information regarding disputes may be submitted.
   (b) An insurer shall also ensure that a dispute resolution
mechanism is accessible to noncontracting providers for the purpose
of resolving billing and claims disputes.
   (c) Disputes are to be submitted to the insurer in writing and
shall include provider name, provider tax identification number,
patient name, insurer's identification information, dates of service,
description of dispute, and, if applicable, billed and paid amounts.
The insurer shall resolve each provider dispute consistent with
applicable law and issue a written determination within 45 working
days after the date of receipt of the provider dispute.
   (d) On and after July 1, 2007, an insurer shall annually submit a
report to the department regarding its dispute resolution mechanism.
The report shall be public information and include, at a minimum,
information on the number of providers that utilized the dispute
resolution mechanism and a summary of the disposition of those
disputes. To the extent the commissioner requires detailed
information disclosing emerging or established patterns of provider
disputes or corrective action by the insurer, the commissioner may
maintain the confidentiality of any information found to be
proprietary, upon written request of the insurer. In no event shall
the commissioner find the required minimum information described in
this subdivision to be proprietary.
   (e) If an insurer has an affiliated or subsidiary company that is
licensed as a health care service plan under Chapter 2.2 (commencing
with Section 1340) of Division 2 of the Health and Safety Code, the
insurer may use the same procedures relating to the provider dispute
resolution process established by the affiliated or subsidiary entity
pursuant to subdivision (h) of Section 1367 of the Health and Safety
Code.


10123.14.  On and after January 1, 1990, every self-insured employee
welfare benefit plan containing hospital, medical, or surgical
expense benefits or service benefits may provide coverage for the
treatment of alcoholism, chemical dependency, or nicotine use under
such terms and conditions as may be agreed upon between the
self-insured welfare benefit plan and the member, where the treatment
may take place in facilities licensed to provide alcoholism or
chemical dependency services under Chapter 2 (commencing with Section
1250) of Division 2 of the Health and Safety Code.
   Treatment for nicotine use may be subject to separate deductibles,
copayments, and overall cost limitations as determined by the plan.




10123.141.  (a) Every policy of expense incurred hospital, medical,
or surgical insurance issued, amended, or renewed on or after January
1, 1991, on a group basis, except for policies that only provide
coverage for specified diseases or other limited benefit coverage,
shall offer coverage as an option for special footwear needed by
persons who suffer from foot disfigurement under the terms and
conditions agreed upon between the group contract holder and the
insurer.
   (b) As used in this section, foot disfigurement shall include, but
not be limited to, disfigurement from cerebral palsy, arthritis,
polio, spina bifida, and diabetes, and foot disfigurement caused by
accident or developmental disability.


10123.145.  Whenever an insurer issuing group or individual policies
of disability insurance which covers hospital, medical, or surgical
expenses determines that in reimbursing a claim for provider services
an institutional or professional provider has been overpaid, and
then notifies the provider in writing through a separate notice
identifying the overpayment and the amount of the overpayment, the
provider shall reimburse the insurer within 30 working days of
receipt by the provider of the notice of overpayment unless the
overpayment or portion thereof is contested by the provider in which
case the insurer shall be notified, in writing, within 30 working
days.  The notice that an overpayment is being contested shall
identify the portion of the overpayment that is contested and the
specific reasons for contesting the overpayment.
   If the provider does not make reimbursement for an uncontested
overpayment within 30 working days after receipt, interest shall
accrue at the rate of 10 percent per annum beginning with the first
calendar day after the 30 working day period.



10123.147.  (a) Every insurer issuing group or individual policies
of health insurance that covers hospital, medical, or surgical
expenses, including those telemedicine services covered by the
insurer as defined in subdivision (a) of Section 2290.5 of the
Business and Professions Code, shall reimburse each complete claim,
or portion thereof, whether in state or out of state, as soon as
practical, but no later than 30 working days after receipt of the
complete claim by the insurer. However, an insurer may contest or
deny a claim, or portion thereof, by notifying the claimant, in
writing, that the claim is contested or denied, within 30 working
days after receipt of the complete claim by the insurer. The notice
that a claim, or portion thereof, is contested shall identify the
portion of the claim that is contested, by revenue code, and the
specific information needed from the provider to reconsider the
claim. The notice that a claim, or portion thereof, is denied shall
identify the portion of the claim that is denied, by revenue code,
and the specific reasons for the denial, including the factual and
legal basis known at that time by the insurer for each reason. If the
reason is based solely on facts or solely on law, the insurer is
required to provide only the factual or legal basis for its reason to
deny the claim. The insurer shall provide a copy of the notice
required by this subdivision to each insured who received services
pursuant to the claim that was contested or denied and to the insured'
s health care provider that provided the services at issue. The
notice required by this subdivision shall include a statement
advising the provider who submitted the claim on behalf of the
insured or pursuant to a contract for alternative rates of payment
and the insured that either may seek review by the department of a
claim that was contested or denied by the insurer and the address,
Internet Web site address, and telephone number of the unit within
the department that performs this review function. The notice to the
provider may be included on either the explanation of benefits or
remittance advice and shall also contain a statement advising the
provider of its right to enter into the dispute resolution process
described in Section 10123.137. An insurer may delay payment of an
uncontested portion of a complete claim for reconsideration of a
contested portion of that claim so long as the insurer pays those
charges specified in subdivision (b).
   (b) If a complete claim, or portion thereof, that is neither
contested nor denied, is not reimbursed by delivery to the claimant's
address of record within the 30 working days after receipt, the
insurer shall pay the greater of fifteen dollars () per year or
interest at the rate of 10 percent per annum beginning with the first
calendar day after the 30-working-day period. An insurer shall
automatically include the fifteen dollars () per year or interest
due in the payment made to the claimant, without requiring a request
therefor.
   (c) For the purposes of this section, a claim, or portion thereof,
is reasonably contested if the insurer has not received the
completed claim. A paper claim from an institutional provider shall
be deemed complete upon submission of a legible emergency department
report and a completed UB 92 or other format adopted by the National
Uniform Billing Committee, and reasonable relevant information
requested by the insurer within 30 working days of receipt of the
claim.  An electronic claim from an institutional provider shall be
deemed complete upon submission of an electronic equivalent to the UB
92 or other format adopted by the National Uniform Billing
Committee, and reasonable relevant information requested by the
insurer within 30 working days of receipt of the claim. However, if
the insurer requests a copy of the emergency department report within
the 30 working days after receipt of the electronic claim from the
institutional provider, the insurer may also request additional
reasonable relevant information within 30 working days of receipt of
the emergency department report, at which time the claim shall be
deemed complete. A claim from a professional provider shall be deemed
complete upon submission of a completed HCFA 1500 or its electronic
equivalent or other format adopted by the National Uniform Billing
Committee, and reasonable relevant information requested by the
insurer within 30 working days of receipt of the claim. The provider
shall provide the insurer reasonable relevant information within 15
working days of receipt of a written request that is clear and
specific regarding the information sought. If, as a result of
reviewing the reasonable relevant information, the insurer requires
further information, the insurer shall have an additional 15 working
days after receipt of the reasonable relevant information to request
the further information, notwithstanding any time limit to the
contrary in this section, at which time the claim shall be deemed
complete.
   (d) This section shall not apply to claims about which there is
evidence of fraud and misrepresentation, to eligibility
determinations, or in instances where the plan has not been granted
reasonable access to information under the provider's control. An
insurer shall specify, in a written notice to the provider within 30
working days of receipt of the claim, which, if any, of these
exceptions applies to a claim.
   (e) If a claim or portion thereof is contested on the basis that
the insurer has not received information reasonably necessary to
determine payer liability for the claim or portion thereof, then the
insurer shall have 30 working days after receipt of this additional
information to complete reconsideration of the claim. If a claim, or
portion thereof, undergoing reconsideration is not reimbursed by
delivery to the claimant's address of record within the 30 working
days after receipt of the additional information, the insurer shall
pay the greater of fifteen dollars () per year or interest at the
rate of 10 percent per annum beginning with the first calendar day
after the 30-working-day period. An insurer shall automatically
include the fifteen dollars () per year or interest due in the
payment made to the claimant, without requiring a request therefor.
   (f) An insurer shall not delay payment on a claim from a physician
or other provider to await the submission of a claim from a hospital
or other provider, without citing specific rationale as to why the
delay was necessary and providing a monthly update regarding the
status of the claim and the insurer's actions to resolve the claim,
to the provider that submitted the claim.
   (g) An insurer shall not request or require that a provider waive
its rights pursuant to this section.
   (h) This section shall apply only to claims for services rendered
to a patient who was provided emergency services and care as defined
in Section 1317.1 of the Health and Safety Code in the United States
on or after September 1, 1999.
   (i) This section shall not be construed to affect the rights or
obligations of any person pursuant to Section 10123.13.
   (j) This section shall not be construed to affect a written
agreement, if any, of a provider to submit bills within a specified
time period.


10123.15.  Every group policy of disability insurance which covers
hospital, medical, and surgical expenses on a group basis, and which
offers coverage for disorders of the brain shall also offer coverage
in the same manner for the treatment of the following biologically
based severe mental disorders:  schizophrenia, schizo-affective
disorder, bipolar disorders and delusional depressions, and pervasive
developmental disorder.  Coverage for these mental disorders shall
be subject to the same terms and conditions applied to the treatment
of other disorders of the brain; however, an insurer may reserve the
right to confirm diagnoses and to review the appropriateness of
specific treatment plans as necessary to ensure that coverage under
this section is provided for only those diagnostic and treatment
services which are medically necessary.
   Nothing in this section shall be construed to affect the scope of
licensure of any health care professional nor to impair rights to
reimbursement guaranteed health care providers pursuant to Section
10176.



10123.16.  Except for a preexisting condition, every disability
insurer issuing policies of individual or group disability insurance
in this state that offers group or individual coverage for long-term
care facility services or home-based care shall not exclude persons
covered by the plan from receiving these benefits, if they are
diagnosed as having any significant destruction of brain tissue with
resultant loss of brain function, including, but  not limited to,
progressive, degenerative, and dementing   illnesses, including, but
not limited to, Alzheimer's disease, from the coverage offered for
long-term care facility services or home-based care.
   For purposes of this section, where a particular disease can be
determined only with an autopsy, "diagnosed" means clinical diagnosis
  not dependent on pathological confirmation, but employing
nationally accepted criteria.



10123.17.  Except for a preexisting condition, every self-insured
employee welfare benefit plan in this state that offers group
coverage for long-term care facility services or home-based care
shall not exclude persons covered by the plan from receiving these
benefits, if they are diagnosed as having any significant destruction
of brain tissue with resultant loss of brain function, including,
but not limited to,  progressive, degenerative, and dementing
illnesses, including, but not limited to, Alzheimer's disease, from
the coverage offered for long-term care facility services or
home-based care.
   For purposes of this section, where a particular disease can be
determined only  with an autopsy, "diagnosed" means clinical
diagnosis  not dependent on pathological confirmation, but employing
nationally accepted criteria.



10123.18.  (a) Every individual or group policy of health insurance
that provides coverage for hospital, medical, or surgical benefits,
that is issued, amended, or renewed, on or after January 1, 2002, and
that includes coverage for treatment or surgery of cervical cancer
shall also be deemed to provide coverage, upon the referral of a
patient's physician and surgeon, a nurse practitioner, or a certified
nurse midwife, providing care to the patient and operating within
the scope of practice otherwise permitted for the licensee, for an
annual cervical cancer screening test.
   The coverage for an annual cervical cancer screening test provided
pursuant to this section shall include the conventional Pap test, a
human papillomavirus screening test that is approved by the federal
Food and Drug Administration, and the option of any cervical cancer
screening test approved by the federal Food and Drug Administration,
upon the referral of the patient's health care provider.
   Nothing in this section shall be construed to require an
individual or group policy to cover treatment or surgery for cervical
cancer or to prevent application of deductible or copayment
provisions contained in the policy or certificate, nor shall this
section be construed to require that coverage under an individual or
group policy be extended to any other procedures.
   (b) This section shall not apply to vision only, dental only,
accident only, specified disease, hospital indemnity, Medicare
supplement, CHAMPUS supplement, long-term care, or disability income
insurance. For accident only, hospital indemnity, or specified
disease insurance, coverage for benefits under this section shall
apply only to the extent that the benefits are covered under the
general terms and conditions that apply to all other benefits under
the policy or certificate. Nothing in this section shall be construed
as imposing a new benefit mandate on accident only, hospital
indemnity, or specified disease insurance.


10123.184.  Every group policy of disability insurance that covers
hospital, medical, or surgical expenses, and that provides maternity
benefits, that is issued, amended, renewed, or delivered on or after
January 1, 1999, and every individual policy of disability insurance
that covers hospital, medical, or surgical expenses, and that
provides maternity benefits, that is of a type and form first offered
for sale on or after January 1, 1999, shall provide coverage for
participation in the Expanded Alpha Feto Protein (AFP) program, which
is a statewide prenatal testing program administered by the State
Department of Health Services.  Notwithstanding any other provision
of law, a disability insurer that provides coverage for maternity
benefits shall not require participation in the statewide prenatal
testing program administered by the State Department of Health
Services as a prerequisite to eligibility for, or receipt of, any
other service.


10123.185.  (a) Every policy of disability insurance that covers
hospital, medical, or surgical expenses and is issued, amended,
delivered, or renewed in this state and certificate of group
disability insurance issued, amended, delivered, or renewed in this
state pursuant to a master group policy issued, amended, delivered,
or renewed in another state on or after January 1, 1994, shall be
deemed to include coverage for services related to diagnosis,
treatment, and appropriate management of osteoporosis.  The services
may include, but need not be limited to, all Food and Drug
Administration approved technologies, including bone mass measurement
technologies as deemed medically appropriate.
   (b) This section shall not apply to specified accident, specified
disease, hospital indemnity, Medicare supplement, or long-term care
health insurance policies.


10123.19.  (a) Any disability insurance policy that includes terms
that require binding arbitration to settle disputes and that
restrict, or provide for a waiver of, the right to a jury trial shall
include, in clear and understandable language, a disclosure that
meets all of the following conditions:
   (1) The disclosure shall clearly state whether the plan uses
binding arbitration to settle disputes, including specifically
whether the plan uses binding arbitration to settle claims of medical
malpractice.
   (2) The disclosure shall appear as a separate article in the
agreement issued to the employer group or individual subscriber and
shall be prominently displayed on the enrollment form signed by each
subscriber or enrollee.
   (3) In any disability insurance policy, the disclosure required by
this section shall be displayed immediately before the signature
line provided for the representative of the group contracting with a
disability insurer and immediately before the signature line provided
for the individual enrolling in the policy.
   (b) Any disability insurance policy that includes a term that
requires the parties to submit to binding arbitration in case of a
medical malpractice claim or dispute shall, for those cases or
disputes for which the total amount of damages claimed is fifty
thousand dollars (,000) or less, provide for  selection by the
parties of a single neutral arbitrator who shall have no jurisdiction
to award more than fifty thousand dollars (,000).  If the parties
are unable to agree on the selection of a single neutral arbitrator,
the method provided in Section 1281.6 of the Code of Civil Procedure
shall be utilized.
   The provision shall not be subject to waiver by the policy.



10123.194.  (a) Every disability insurer that covers hospital,
medical, or surgical expenses, and, as part of that coverage, also
covers prescription drug benefits, and that issues a card to insureds
for claims processing purposes, shall issue to each of its insureds
a uniform card containing uniform prescription drug information.  The
uniform prescription drug information card shall, at a minimum,
include the following information:
   (1) The name or logo of the benefit administrator or disability
insurer issuing the card, which shall be displayed on the front side
of the card.
   (2) The insured's identification number, or the policyholder's
identification number when the insured is a dependent who accesses
services using the policy holder's identification number, which shall
be displayed on the front side of the card.
   (3) A telephone number that pharmacy providers may call for
assistance.
   (4) Information required by the benefit administrator or
disability insurer that is necessary to commence processing the
pharmacy claim, except as provided for in paragraph (5).
   (5) A disability insurer shall not be required to print any  of
the following information on an insured's card:
   (A) Any number that is the same for all of its insured, provided
that the disability insurer provides this number to the pharmacy on
an annual basis.
   (B) Any information that may result in fraudulent use of the card.

   (C) Any information that is otherwise prohibited from being
included on the card.
   (b) Beginning July 1, 2002, the new uniform prescription drug
information card required by subdivision (a) shall be issued by an
insurer to an insured upon enrollment or upon any change in the
insured's coverage that impacts the data content or format of the
card.
   (c) Nothing in this section requires an insurer to issue a
separate card for prescription drug coverage if the insurer issues a
card for health care coverage in general and the card is able to
accommodate the information required by subdivision (a).
   (d) "Card" as used in this section includes other technology that
performs substantially the same function as a card.
   (e) For purposes of this section, if a disability insurer
delegates responsibility for issuing the uniform prescription drug
information card to a contractor or agent, then the contract between
the disability insurer and its contractor or agent shall require
compliance with this section.


10123.195.  (a) No group or individual disability insurance policy
issued, delivered, or renewed in this state or certificate of group
disability insurance issued, delivered, or renewed in this state
pursuant to a master group policy issued, delivered, or renewed in
another state that, as a provision of hospital, medical, or surgical
services, directly or indirectly covers prescription drugs shall
limit or exclude coverage for a drug on the basis that the drug is
prescribed for a use that is different from the use for which that
drug has been approved for marketing by the federal Food and Drug
Administration (FDA), provided that all of the following conditions
have been met:
   (1) The drug is approved by the FDA.
   (2) (A) The drug is prescribed by a contracting licensed health
care professional for the treatment of a life-threatening condition;
or
   (B) The drug is prescribed by a contracting licensed health care
professional for the treatment of a chronic and seriously
debilitating condition, the drug is medically necessary to treat that
condition, and the drug is on the insurer's formulary, if any.
   (3) The drug has been recognized for treatment of that condition
by one of the following:
   (A) The American Medical Association Drug Evaluations.
   (B) The American Hospital Formulary Service Drug Information.
   (C) The United States Pharmacopoeia Dispensing Information, Volume
1, "Drug Information for the Health Care Professional."
   (D) Two articles from major peer reviewed medical journals that
present data supporting the proposed off-label use or uses as
generally safe and effective unless there is clear and convincing
contradictory evidence presented in a major peer reviewed medical
journal.
   (b) It shall be the responsibility of the contracting prescriber
to submit to the insurer documentation supporting compliance with the
requirements of subdivision (a), if requested by the insurer.
   (c) Any coverage required by this section shall also include
medically necessary services associated with the administration of a
drug subject to the conditions of the contract.
   (d) For purposes of this section, "life-threatening" means either
or both of the following:
   (1) Diseases or conditions where the likelihood of death is high
unless the course of the disease is interrupted.
   (2) Diseases or conditions with potentially fatal outcomes, where
the end point of clinical intervention is survival.
   (e) For purposes of this section, "chronic and seriously
debilitating" means diseases or conditions that require ongoing
treatment to maintain remission or prevent deterioration and cause
significant long-term morbidity.
   (f) The provision of drugs and services when required by this
section shall not, in itself, give rise to liability on the part of
the insurer.
   (g) This section shall not apply to a policy of disability
insurance that covers hospital, medical, or surgical expenses which
is issued outside of California to an employer whose principal place
of business is located outside of California.
   (h) Nothing in this section shall be construed to prohibit the use
of a formulary, copayment, technology assessment panel, or similar
mechanism as a means for appropriately controlling the utilization of
a drug that is prescribed for a use that is different from the use
for which that drug has been approved for marketing by the FDA.
   (i) If an insurer denies coverage pursuant to this section on the
basis that its use is experimental or investigational, that decision
is subject to review under the Independent Medical Review System of
Article 3.5 (commencing with Section 10169).
   (j) This section is not applicable to vision-only, dental-only,
Medicare or Champus supplement, disability income, long-term care,
accident-only, specified disease or hospital confinement indemnity
insurance.


10123.196.  (a) Every individual and group policy of disability
insurance issued, amended, renewed, or delivered on or after January
1, 2000, that provides coverage for hospital, medical, or surgical
expenses, shall provide coverage for the following, under the same
terms and conditions as applicable to all benefits:
   (1) A disability insurance policy that provides coverage for
outpatient prescription drug benefits shall include coverage for a
variety of federal Food and Drug Administration (FDA) approved
prescription contraceptive methods, as designated by the insurer.  If
an insured's health care provider determines that none of the
methods designated by the disability insurer is medically appropriate
for the insured's medical or personal history, the insurer shall, in
the alternative, provide coverage for some other FDA approved
prescription contraceptive method prescribed by the patient's health
care provider.
   (2) Outpatient prescription coverage with respect to an insured
shall be identical for an insured's covered spouse and covered
nonspouse dependents.
   (b) Nothing in this section shall be construed to deny or restrict
in any way any existing right or benefit provided under law or by
contract.
   (c) Nothing in this section shall be construed to require an
individual or group disability insurance policy to cover experimental
or investigational treatments.
   (d) Notwithstanding any other provision of this section, a
religious employer may request a disability insurance policy without
coverage for contraceptive methods that are contrary to the religious
employer's religious tenets.  If so requested, a disability
insurance policy shall be provided without coverage for contraceptive
methods.
   (1) For purposes of this section, a "religious employer" is an
entity for which each of the following is true:
   (A) The inculcation of religious values is the purpose of the
entity.
   (B) The entity primarily employs persons who share the religious
tenets of the entity.
   (C) The entity serves primarily persons who share the religious
tenets of the entity.
   (D) The entity is a nonprofit organization pursuant to Section
6033(a)(2)(A)(i) or (iii) of the Internal Revenue Code of 1986, as
amended.
   (2) Every religious employer that invokes the exemption provided
under this section shall provide written notice to any prospective
employee once an offer of employment has been made, and prior to that
person commencing that employment, listing the contraceptive health
care services the employer refuses to cover for religious reasons.
   (e) Nothing in this section shall be construed to exclude coverage
for prescription contraceptive supplies ordered by a health care
provider with prescriptive authority for reasons other than
contraceptive purposes, such as decreasing the risk of ovarian cancer
or eliminating symptoms of menopause, or for prescription
contraception that is necessary to preserve the life or health of an
insured.
   (f) This section shall only apply to disability insurance policies
or contracts that are defined as health benefit plans pursuant to
subdivision (a) of Section 10198.6, except that for accident only,
specified disease, or hospital indemnity coverage, coverage for
benefits under this section shall apply to the extent that the
benefits are covered under the general terms and conditions that
apply to all other benefits under the policy or contract. Nothing in
this section shall be construed as imposing a new benefit mandate on
accident only, specified disease, or hospital indemnity insurance.




10123.20.  (a) Every individual or group disability insurance policy
that covers hospital, medical, or surgical expenses that is issued,
amended, delivered, or renewed on or after July 1, 2000, shall be
deemed to provide coverage for all generally medically accepted
cancer screening tests, subject to all other terms and conditions
that would otherwise apply.
   (b) This section shall not apply to vision-only, dental-only,
accident-only, specified disease, hospital indemnity, Medicare
supplement, long-term care, or disability income insurance, except
that for accident-only, specified disease, or hospital indemnity
insurance, coverage for benefits under this section shall apply to
the extent that the benefits are covered under the general terms and
conditions that apply to all other benefits under the policy or
contract.  Nothing in this section shall be construed as imposing a
new benefit mandate on accident-only, specified disease, or hospital
indemnity insurance.



10123.21.  On or after July 1, 1995, every individual or group
policy of disability insurance that provides hospital, medical, or
surgical coverage entered into, amended, or renewed in this state
shall, subject to other terms and conditions as may be agreed upon
between the group or individual policyholder and the insurer, provide
coverage for the surgical procedure for those covered conditions
directly affecting the upper or lower jawbone, or associated bone
joints, if each procedure being considered for reimbursement is
deemed medically-necessary by the insurer pursuant to the policy's
definition of medical necessity.  Nothing in this section shall be
construed to require the provision of dental services if dental
services are specifically excluded from coverage under the terms and
conditions of the contract between the group or individual
policyholder and insurer.



10123.21.  (a) A health insurer shall not deny coverage that is
otherwise available under the health insurance policy for the costs
of solid organ or other tissue transplantation services based upon
the insured or policyholder being infected with the human
immunodeficiency virus.
   (b) Notwithstanding any other provision of law, in the provision
of benefits required by this section, a health insurer may utilize
case management, managed care, or utilization review, subject to the
terms and conditions of the policy and consistent with sound clinical
processes and guidelines.



10124.  (a) A self-insured employee welfare benefit plan delivered
or issued for delivery in this state more than 120 days after the
effective date of this section, which provides that coverage of a
dependent child of an employee shall terminate upon attainment of the
limiting age for dependent children specified in the policy or
contract, shall also provide in substance that attainment of such
limiting age shall not operate to terminate the coverage of such
child while the child is and continues to be both (a) incapable of
self-sustaining employment by reason of mental retardation or
physical handicap and (b) chiefly dependent upon the employee for
support and maintenance, provided proof of such incapacity and
dependency is furnished to the employer or employee organization
providing the plan or program of benefits by the employee within 31
days of the child's attainment of the limiting age and subsequently
as may be required by such employer or employee organization, but not
more frequently than annually after the two-year period following
the child's attainment of the limiting age.
   (b) As used in this section, "self-insured employee welfare
benefit plan" means any plan or program of benefits provided by an
employer or an employee organization, or both, for the purpose of
providing hospital, medical, surgical, nursing, or dental services,
or indemnification for the costs incurred for such services, to such
employer's employees or their dependents.



10124.7.  Each self-insured employee benefit plan issued or renewed
on or after the effective date of this section shall provide, where
feasible, that benefits for confinement in an extended care facility,
as defined in subsection (j) of Section 1395x of Title 42 of the
United States Code, may be provided under such terms and conditions
as may be agreed upon between the employer and the employee or
employee organization.
   Nothing in this section shall preclude a self-insured employee
benefit plan from providing benefits for confinement in institutions
other than extended care facilities as defined in this section.



10125.  (a) On and after January 1, 1974, every insurer issuing
group disability insurance which covers hospital, medical, or
surgical expenses shall offer coverage for expenses incurred as a
result of mental or nervous disorders, under the terms and conditions
which may be agreed upon between the group policyholder and the
insurer.  If the terms and conditions include coverage for inpatient
care for nervous or mental disorders, the coverage shall extend to
treatment provided at all of the following facilities:
   (1) A general acute care hospital as defined in subdivision (a) of
Section 1250 of the Health and Safety Code.
   (2) An acute psychiatric hospital as defined in subdivision (b) of
Section 1250 of the Health and Safety Code.
   (3) A psychiatric health facility as defined by Section 1250.2 of
the Health and Safety Code operating pursuant to licensure by the
State Department of Mental Health.
   Nothing in this subdivision prohibits an insurer which negotiates
and enters into a contract with a professional or institutional
provider for alternative rates of payment pursuant to Sections 10133
and 11512 of this code from restricting or modifying the choice of
providers.
   (b) Every insurer shall communicate to prospective group
policyholders as to the availability of outpatient coverage for the
treatment of mental or nervous disorders.  Every insurer shall
communicate the availability of that coverage to all group
policyholders and to all prospective group policyholders with whom
they are negotiating.  This coverage may include community
residential treatment services, as described in Section 5458 of the
Welfare and Institutions Code, which are alternatives to
institutional care.



10125.1.  (a) Every insurer issuing group disability insurance that
covers hospital, medical, or surgical expenses that offers coverage
for a service that is within the scope of practice of a duly licensed
pharmacist may pay or reimburse the cost of the service performed by
a pharmacist for the insurer if the pharmacist otherwise provides
services for the insurer.
   (b) Payment or reimbursement may be made pursuant to this section
for a service performed by a duly licensed pharmacist only when all
of the following conditions are met:
   (1) The service performed is within the lawful scope of practice
of the pharmacist.
   (2) The coverage otherwise provides reimbursement for identical
services performed by other licensed health care providers.
   (c) Nothing in this section shall require the insurer to pay a
claim to more than one provider for duplicate service or be
interpreted to limit physician reimbursement.



10126.  Every policy of group disability insurance issued, amended,
or renewed on or after January 1, 1977, which provides hospital,
medical, or surgical expense benefits for employees or members and
their dependents and which contains provisions granting the employee
or member the right to convert the insurance coverage in the event of
termination of employment or membership, shall include in such
conversion provisions the same conversion rights and conditions to a
covered dependent spouse of the employee or member in the event the
covered dependent spouse ceases to be a qualified family member by
reason of termination of marriage or death of the employee or member.
  Such conversion rights shall not require a physical examination or
a statement of health.



10126.5.  If a disability insurance policy between an insurer that
covers hospital, medical, or surgical expenses and a provider
requires that the provider accept, as payment from the insurer, the
lowest payment rate charged by the provider to any patient or third
party, this policy provision shall not be deemed to apply to, or take
into consideration, any cash payments made to the provider by
individual patients who do not have any private or public form of
health care coverage for the service rendered by the provider, as
described in subdivision (c) of Section 657 of the Business and
Professions Code.  This section shall apply to a provider contract
that is issued, amended, or renewed on or after the effective date of
this section.



10126.6.  (a) Every policy of disability insurance that provides
hospital, medical, or surgical coverage under a health benefit plan,
defined in subdivision (a) of Section 10198.6, that provides coverage
for emergency health care services, that is issued, amended,
delivered, or renewed in this state on or after January 1, 1999,
shall include coverage for emergency medical transportation services,
as defined in subdivision (b).  This coverage shall be provided
without regard to whether the emergency provider has a contractual
arrangement with the insurer or whether there was prior
authorization, subject to the terms and conditions of the policy.
   (b) For purposes of this section, "emergency medical
transportation services" means ambulance services provided through
the "911" emergency response system.



10127.  On and after January 1, 1974, every self-insured employee
welfare benefit plan which provides coverage for hospital, medical,
or surgical expenses shall offer coverage for expenses incurred as a
result of mental or nervous disorders, under the terms and conditions
which may be agreed upon between the self-insured welfare benefit
plan and the member.  If the terms and conditions include coverage
for services provided in a general acute care hospital, or an acute
psychiatric hospital as defined in Section 1250 of the Health and
Safety Code, and do not restrict or modify the choice of providers,
the coverage shall extend to care provided by a psychiatric health
facility, as defined by Section 1250.2 of the Health and Safety Code,
operating pursuant to licensure by the State Department of Mental
Health.  Every plan shall communicate to prospective members as to
the availability of outpatient coverage for the treatment of mental
or nervous disorders.  Every self-insured welfare benefit plan shall
communicate the availability of this coverage to all members and
prospective members.  This coverage may include community residential
treatment services, as described in Section 5458 of the Welfare and
Institutions Code, which are alternatives to institutional care.




10127.1.  (a) No policy of disability insurance providing loss of
time benefits shall contain any provision for a reduction of such
benefits during a benefit period because of an increase in benefits
payable under the Federal Social Security Act, as amended.
   (b) No self-insured employee welfare benefit plan providing loss
of time benefits shall contain any provision for a reduction of such
benefits during a benefit period because of an increase in benefits
payable under the Federal Social Security Act, as amended.
   (c) This section shall apply to all disability insurance policies
issued, delivered, amended, or renewed in this state on or after
January 1, 1977, and shall apply to group disability insurance
policies and self-insured employee welfare benefit plans which are
entered into, amended, or renewed on or after such date or upon the
expiration of any applicable collective-bargaining agreement,
whichever occurs later.


10127.15.  Any provision contained in a policy of disability
insurance or a self-insured employee welfare benefit plan for a
reduction of loss of time benefits during a benefit period because of
an increase in benefits payable under the federal Social Security
Act, as amended, shall be null and void with respect to any such
increase which occurs on or after the effective date of this section.



10127.2.  Each policy of disability insurance issued or renewed on
or after the effective date of this section, which policy provides
benefits that accrue after a certain time of confinement in a health
care facility, shall specify what constitutes a day of confinement or
the number of consecutive hours of confinement which are requisite
to the commencement of benefits.
   With respect to renewal of individual policies of disability
insurance, insurers shall not be required to issue notification to
the insured of the provisions of this section unless notice of policy
renewal is delivered to the insured.



10127.3.  On and after January 1, 1985, every insurer issuing group
disability insurance which covers hospital, medical, or surgical
expenses shall offer coverage for expenses incurred as a result of
treatment by holders of certificates under Section 4938 of the
Business and Professions Code, under such terms and conditions as may
be agreed upon between the group policyholder and the insurer.
   An insurer is not required to offer the coverage provided by this
section as part of any policy covering employees of a public entity.



10127.4.  (a) Except as provided in subdivisions (b) and (c), no
contract that is issued, amended, renewed, or delivered on or after
January 1, 1999, between a disability insurer that provides coverage
for hospital, medical, or surgical benefits and a health care
provider shall contain provisions that prohibit, restrict, or limit
the health care provider from advertising.
   (b) Nothing in this section shall be construed to prohibit
disability insurers from establishing reasonable guidelines in
connection with the activities regulated pursuant to this part,
including those to prevent advertising that is, in whole or in part,
untrue, misleading, deceptive, or otherwise inconsistent with this
part or the rules and regulations promulgated thereunder.  For
advertisements mentioning a provider's participation in a plan or
product line of a disability insurer, nothing in this section shall
be construed to prohibit disability insurers from requiring each
advertisement to contain a disclaimer to the effect that the provider'
s services may be covered for some, but not all, plans or product
lines of the disability insurer, or that the disability insurer may
cover some, but not all, provider services.
   (c) Nothing in this section is intended to prohibit provisions or
agreements intended to protect service marks, trademarks, trade
secrets, or other confidential information or property.  If a health
care provider participates in a provider panel or network as a result
of a direct contractual agreement with a disability insurer that, in
turn, has entered into a direct contractual agreement with another
person or entity, pursuant to which insureds and other beneficiaries
of that other person or entity may receive covered services from the
health care provider, then nothing in this section is intended to
prohibit reasonable provisions or agreements in the direct
contractual arrangement between the health care provider and the
disability insurer that protect the name or trade name of the other
person or entity or requires that the health care provider obtain the
consent of the disability insurer prior to the use of the name or
trade name of the other person or entity in any advertising by the
health care provider.
   (d) Nothing in this section shall be construed to impair or impede
the authority of the commissioner to regulate advertising,
disclosure, or solicitation pursuant to this part.



10127.5.  Every application for, certificate of, and policy of
credit life or credit disability insurance shall set forth a
statement in bold capital letters indicating that any preexisting
health condition of the applicant may render the coverage void, if
that is the case.
   For the purpose of this section, "credit life or credit disability
insurance" means insurance on the life or health of any borrower
sold by any creditor to provide for the repayment of the amount of a
loan or other extension of credit in the event of the debtor's death
or disability as defined in the policy.



10127.7.  Every policy of individual life insurance with a face
value of less than ten thousand dollars (,000) which is delivered
or issued for delivery in this state on and after July 1, 1974, shall
have printed thereon or attached thereto a notice stating that,
after receipt of the policy by the owner, the policy may be returned
by the owner for cancellation by delivering it or mailing it to the
insurer or to the agent through whom it was purchased. The period of
time set forth by the insurer for return of the policy by the insured
shall be clearly stated on the notice and this period shall be not
less than 10 days nor more than 30 days.  The insured may return the
policy to the insurer at any time during the period specified in the
notice.  This delivery or mailing of the policy by the owner shall
void the policy from the beginning, and the parties shall be in the
same position as if no policy or contract had been issued. All
premiums paid and any policy fee paid for the policy shall be
refunded to the owner.
   This section applies to all policies issued, amended, or delivered
  in this state on or after January 1, 1981, but prior to January 1,
1990, and applies to any renewal thereof.  All policies subject to
this section which are in effect on January 1, 1981, shall be
construed to be in compliance with this section, and any provision in
such a policy which is in conflict with this section shall be of no
force or effect.
   This section does not apply to individual life insurance policies
issued in connection with a credit transaction or issued under a
contractual policy change or conversion privilege provision contained
in a policy.


10127.8.  (a) The purpose of this section is to assure truthful and
adequate disclosure of all material and relevant information in the
advertising of term life insurance which the commissioner, on the
basis of an assessment of the total advertisement, determines is
directed to individuals 55 years of age or older.
   (b) Advertisements for term life insurance directed to individuals
55 years of age or older shall:
   (1) Clearly and prominently distinguish basic life insurance
benefits from suppplemental benefits such as accidental death
benefits.
   (2) Prominently disclose any limitations, exceptions, or
reductions affecting each benefit.
   (3) Prominently disclose any condition affecting the policy or
certificate holder's continued insurability.  If term coverage
terminates at a stated age, or at the end of any designated period,
that fact and the specified age or designated period shall be
disclosed.
   (4) Prominently disclose any change in benefits resulting from the
aging of the insured, policy duration, or any other factor.
   (5) Prominently disclose any change in premium resulting from the
aging of the insured, policy duration, or any other factor.  If the
insurer retains any right to modify premiums in the future, that fact
shall be disclosed.
   (c) If the benefits of the advertised policy or certificate
decrease with the insured's age or with policy or certificate
duration, while the premium remains approximately constant, that fact
shall, in a print or broadcast advertisement, be disclosed, in the
same form and with prominence or visible duration, or both, equal to
that given any positive description of benefits or the telephone
number or address provided for further information or application,
whichever is the most prominent.
   (d) A television or radio advertisement for term life insurance
directed to individuals 55 years of age or older shall in the spoken
text contain the statement "policy (or certificate) benefits and
limitations should be carefully examined prior to purchase."
   (e) The commissioner may, by regulation, adopt a term life
insurance monetary value index, similar to the Life Insurance
Surrender Cost Index of Article 12.5 (commencing with Section 2545)
of Subchapter 2 of Chapter 5 of Title 10 of the California Code of
Regulations, to be disclosed in all advertisements of term life
insurance for individuals 55 years of age or older, and on all
policies and certificates of that insurance.  In developing a term
life insurance monetary value index, the commissioner shall consider
actual premiums and policy and certificate benefits and the manner in
which they are affected with the passage of time.  Any term life
insurance monetary value index developed pursuant to this section
shall assume an insured's desire to retain coverage for at least 10
years.
   (f) This section does not supersede or repeal any regulation of
the commissioner which governs life insurance advertising and such
regulation shall continue to be in force in addition to this section.

   (g) The commissioner shall adopt regulations that are necessary to
carry out this section.
   (h) This section applies to the advertisement of individual
policies of insurance and any group policies or certificates
delivered or issued for delivery in this state, regardless of the
situs of the contract.
   (i) In addition to any other penalty provided by law or the
availability of any administrative procedure, if an insurer, after
notice and hearing, is found to have violated this section, or
regulations adopted pursuant to this section, or knowingly permits
any person to do so, the commissioner, in accordance with the
procedures provided in Section 704, may suspend the insurer's
certificate of authority to transact life insurance.  Section 704.7
shall apply in any proceeding conducted pursuant to this section.



10127.9.  (a) Every policy of individual life insurance which is
initially delivered or issued for delivery in this state on and after
January 1, 1990, shall have printed thereon or attached thereto a
notice stating that, after receipt of the policy by the owner, the
policy may be returned by the owner for cancellation by delivering it
or mailing it to the insurer or to the agent through whom it was
purchased.  The period of time set forth by the insurer for return of
the policy by the insured shall be clearly stated on the notice and
this period shall be not less than 10 days nor more than 30 days.
The insured may return the policy to the insurer by mail or otherwise
at any time during the period specified in the notice.  In the case
of individual life insurance policies (other than variable contracts
and modified guaranteed contracts), by delivering or mailing the
policy pursuant to this section during the cancellation period, the
owner shall void the policy from the beginning, and the parties shall
be in the same position as if no policy had been issued.  All
premiums paid and any policy fee paid for the policy shall be
refunded by the insurer to the owner within 30 days from the date
that the insurer is notified that the  insured has canceled the
policy.  In the case of variable annuity contracts, variable life
insurance contracts, and modified guaranteed contracts, return of the
contract during the cancellation period shall entitle the owner to a
refund of account value and any policy fee paid for the policy.  The
account value and policy fee shall be refunded by the insurer to the
owner within 30 days from the date that the insurer is notified that
the owner has canceled the policy.
   (b) This section applies to all policies issued or delivered in
this state on or after January 1, 1990, but does not apply to any
policy subject to Section 10127.7.  All policies subject to this
section which are in effect on January 1, 1990, shall be construed to
be in compliance with this section, and any provision in any policy
which is in conflict with this section shall be of no force or
effect.
   (c) This section does not apply to individual life insurance
policies issued in connection with a credit transaction or issued
under a contractual policy-change or conversion privilege provision
contained in a policy.



10127.10.  (a) Every policy of individual life insurance and every
individual annuity contract that is initially delivered or issued for
delivery to a senior citizen in this state on and after July 1,
2004, shall have printed thereon or attached thereto a notice stating
that, after receipt of the policy by the owner, the policy may be
returned by the owner for cancellation by delivering it or mailing it
to the insurer or agent from whom it was purchased.  The period of
time set forth by the insurer for return of the policy by the owner
shall be clearly stated on the notice and this period shall be not
less than 30 days.  The owner may return the policy to the insurer by
mail or otherwise at any time during the period specified in the
notice.  During the 30-day cancellation period, the premium for a
variable annuity may be invested only in fixed-income investments and
money-market funds, unless the investor specifically directs that
the premium be invested in the mutual funds underlying the variable
annuity contract.  Return of the policy within the 30-day
cancellation period shall have one of the following effects:
   (1) In the case of individual life insurance policies and variable
annuity contracts for which the owner has not directed that the
premium be invested in the mutual funds underlying the contract
during the cancellation period, return of the policy during the
cancellation period shall have the effect of voiding the policy from
the beginning, and the parties shall be in the same position as if no
policy had been issued.  All premiums paid and any policy fee paid
for the policy shall be refunded by the insurer to the owner within
30 days from the date that the insurer is notified that the owner has
canceled the policy.  The premium and policy fee shall be refunded
by the insurer to the owner within 30 days from the date that the
insurer is notified that the owner has canceled the policy.
   (2) In the case of a variable annuity for which the owner has
directed that the premium be invested in the mutual funds underlying
the contract during the 30-day cancellation period, cancellation
shall entitle the owner to a refund of the account value.  The
account value shall be refunded by the insurer to the owner within 30
days from the date that the insurer is notified that the owner has
canceled the contract.
   (b) This section applies to all individual policies issued or
delivered to senior citizens in this state on or after January 1,
2004.  All policies subject to this section which are in effect on
January 1, 2003, shall be construed to be in compliance with this
section, and any provision in any policy which is in conflict with
this section shall be of no force or effect.
   (c) Every individual life insurance policy and every individual
annuity contract, other than variable contracts and modified
guaranteed contracts, subject to this section, that is delivered or
issued for delivery in this state shall have the following notice
either printed on the cover page or policy jacket in 12-point bold
print with one inch of space on all sides or printed on a sticker
that is affixed to the cover page or policy jacket:
      "IMPORTANT

   YOU HAVE PURCHASED A LIFE INSURANCE POLICY OR ANNUITY CONTRACT.
CAREFULLY REVIEW IT FOR LIMITATIONS.

   THIS POLICY MAY BE RETURNED WITHIN 30 DAYS FROM THE DATE YOU
RECEIVED IT FOR A FULL REFUND BY RETURNING IT TO THE INSURANCE
COMPANY OR AGENT WHO SOLD YOU THIS POLICY.  AFTER 30 DAYS,
CANCELLATION MAY RESULT IN A SUBSTANTIAL PENALTY, KNOWN AS A
SURRENDER CHARGE."

   The phrase "after 30 days, cancellation may result in a
substantial penalty, known as a surrender charge" may be deleted if
the policy does not contain those charges or penalties.
   (d) Every individual variable annuity contract, variable life
insurance contract, or modified guaranteed contract subject to this
section, that is delivered or issued for delivery in this state,
shall have the following notice either printed on the cover page or
policy jacket in 12-point bold print with one inch of space on all
sides or printed on a sticker that is affixed to the cover page or
policy jacket:
      "IMPORTANT

   YOU HAVE PURCHASED A VARIABLE ANNUITY CONTRACT (VARIABLE LIFE
INSURANCE CONTRACT, OR MODIFIED GUARANTEED CONTRACT).  CAREFULLY
REVIEW IT FOR LIMITATIONS.

   THIS POLICY MAY BE RETURNED WITHIN 30 DAYS FROM THE DATE YOU
RECEIVED IT.  DURING THAT 30-DAY PERIOD, YOUR MONEY WILL BE PLACED IN
A FIXED ACCOUNT OR MONEY-MARKET FUND, UNLESS YOU DIRECT THAT THE
PREMIUM BE INVESTED IN A STOCK OR BOND PORTFOLIO UNDERLYING THE
CONTRACT DURING THE 30-DAY PERIOD.  IF YOU DO NOT DIRECT THAT THE
PREMIUM BE INVESTED IN A STOCK OR BOND PORTFOLIO, AND IF YOU RETURN
THE POLICY WITHIN THE 30-DAY PERIOD, YOU WILL BE ENTITLED TO A REFUND
OF THE PREMIUM AND POLICY FEES.  IF YOU DIRECT THAT THE PREMIUM BE
INVESTED IN A STOCK OR BOND PORTFOLIO DURING THE 30-DAY PERIOD, AND
IF YOU RETURN THE POLICY DURING THAT PERIOD, YOU WILL BE ENTITLED TO
A REFUND OF THE POLICY'S ACCOUNT VALUE ON THE DAY THE POLICY IS
RECEIVED BY THE INSURANCE COMPANY OR AGENT WHO SOLD YOU THIS POLICY,
WHICH COULD BE LESS THAN THE PREMIUM YOU PAID FOR THE POLICY.  A
RETURN OF THE POLICY AFTER 30 DAYS MAY RESULT IN A SUBSTANTIAL
PENALTY, KNOWN AS A SURRENDER CHARGE."

   The words "known as a surrender charge" may be deleted if the
contract does not contain those charges.
   (e) This section does not apply to life insurance policies issued
in connection with a credit transaction or issued under a contractual
policy-change or conversion privilege provision contained in a
policy.  Additionally, this section shall not apply to contributory
and noncontributory employer group life insurance, contributory and
noncontributory employer group annuity contracts, and group term life
insurance, with the exception of subdivision (f).
   (f) When an insurer, its agent, group master policyowner, or
association collects more than one month's premium from a senior
citizen at the time of application or at the time of delivery of a
group term life insurance policy or certificate, the insurer must
provide the senior citizen a prorated refund of the premium if the
senior citizen delivers a cancellation request to the insurer during
the first 30 days of the policy period.
   (g) For purposes of this chapter, a senior citizen means an
individual who is 60 years of age or older on the date of purchase of
the policy.



10127.11.  Every insurer and life agent offering for sale individual
life insurance policies or individual annuity contracts that are
initially delivered or issued for delivery to senior citizens in this
state on and after January 1, 1995, with the use of nonpreprinted
illustrations of nonguaranteed values shall disclose on those
illustrations or on an attached cover sheet, in bold or underlined
capitalized print, or in the form of a contrasting color sticker,
bright highlighter pen, or in any manner that makes it more prominent
than the surrounding material, with at least one-half inch space on
all four sides, the following statement:

   "THIS IS AN ILLUSTRATION ONLY.  AN ILLUSTRATION IS NOT INTENDED TO
PREDICT ACTUAL PERFORMANCE.  INTEREST RATES, DIVIDENDS, OR VALUES
THAT ARE SET FORTH IN THE ILLUSTRATION ARE NOT GUARANTEED, EXCEPT FOR
THOSE ITEMS CLEARLY LABELED AS GUARANTEED."

   All preprinted policy illustrations shall contain this notice in
12-point bold print with at least one-half inch space on all four
sides and shall be printed on the illustration form itself or on an
attached cover sheet, or in the form of a contrasting color sticker
placed on the front of the illustration.  All preprinted
illustrations containing nonguaranteed values shall show the columns
of guaranteed values in bold print.  All other columns used in the
illustration shall be in standard print.  "Values" as used here
includes cash value, surrender value, and death benefit.



10127.12.  Whenever an insurer provides an annual statement to a
senior citizen policyowner of an individual life insurance policy or
an individual annuity contract issued after January 1, 1995, the
insurer shall also provide the current accumulation value and the
current cash surrender value.



10127.13.  All individual life insurance policies and individual
annuity contracts for senior citizens that contain a surrender charge
period shall either disclose the surrender period and all associated
penalties in 12-point bold print on the cover sheet of the policy or
disclose the location of the surrender information in bold 12-point
print on the cover page of the policy, or printed on a sticker that
is affixed to the cover page or to the policy jacket.  The notice
required by this section may appear on a cover sheet that also
contains the disclosure required by subdivision (d) of Section
10127.10.


10127.14.  (a) The department and the Department of Managed Health
Care shall compile information required by this section and Section
1363.06 of the Health and Safety Code into two comparative benefit
matrices.  The first matrix shall compare benefit packages offered
pursuant to Section 1373.62 of the Health and Safety Code and Section
10127.15.  The second matrix shall compare benefit packages offered
pursuant to Sections 1366.35, 1373.6, and 1399.804 of the Health and
Safety Code and Sections 10785, 10901.2, and 12682.1.
   (b) The comparative benefit matrix shall include:
   (1) Benefit information submitted by health care service plans
pursuant to Section 1363.06 of the Health and Safety Code and by
health insurers pursuant to subdivision (d).
   (2) The following statements in at least 12-point type at the top
of the matrix:
   (A) "This benefit summary is intended to help you compare coverage
and benefits and is a summary only.  For a more detailed description
of coverage, benefits, and limitations, please contact the health
care service plan or health insurer."
   (B) "The comparative benefit summary is updated annually, or more
often if necessary to be accurate."
   (C) "The most current version of this comparative benefit summary
is available on (address of the plan's or insurer's site)."
   This subparagraph applies only to those health insurers that
maintain an Internet Web site.
   (3) The telephone number or numbers that may be used by an
applicant to contact either the department or the Department of
Managed Health Care, as appropriate, for further assistance.
   (c) The department and the Department of Managed Health Care shall
jointly prepare two standardized templates for use by health care
service plans and health insurers in submitting the information
required pursuant to subdivision (d) of Section 1363.06 and
subdivision (d).  The templates shall be exempt from the provisions
of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division
3 of Title 2 of the Government Code.
   (d) Health insurers shall submit the following to the department
by January 31, 2003, and annually thereafter:
   (1) A summary explanation of the following for each product
described in subdivision (a):
   (A) Eligibility requirements.
   (B) The full premium cost of each benefit package in the service
area in which the individual and eligible dependents work or reside.

   (C) When and under what circumstances benefits cease.
   (D) The terms under which coverage may be renewed.
   (E) Other coverage that may be available if benefits under the
described benefit package cease.
   (F) The circumstances under which choice in the selection of
physicians and providers is permitted.
   (G) Lifetime and annual maximums.
   (H) Deductibles.
   (2) A summary explanation of the following coverages, together
with the corresponding copayments and limitations, for each product
described in subdivision (a):
   (A) Professional services.
   (B) Outpatient services.
   (C) Hospitalization services.
   (D) Emergency health coverage.
   (E) Ambulance services.
   (F) Prescription drug coverage.
   (G) Durable medical equipment.
   (H) Mental health services.
   (I) Residential treatment.
   (J) Chemical dependency services.
   (K) Home health services.
   (L) Custodial care and skilled nursing facilities.
   (3) The telephone number or numbers that may be used by an
applicant to access a health insurer customer service representative
and to request additional information about the insurance policy.
   (4) Any other information specified by the department in the
template.
   (e) Each health insurer shall provide the department with updates
to the information required by subdivision (d) at least annually, or
more often if necessary to maintain the accuracy of the information.

   (f) The department and the Department of Managed Health Care shall
make the comparative benefit matrices available on their respective
Internet Web sites and to the health care service plans and health
insurers for dissemination as required by Section 1373.6 of the
Health and Safety Code and Section 12682.1, after confirming the
accuracy of the description of the matrices with the health insurers
and health care service plans.
   (g) As used in this section, "benefit matrix" shall have the same
meaning as benefit summary.
   (h) This section shall not apply to accident-only, specified
disease, hospital indemnity, CHAMPUS supplement, long-term care,
Medicare supplement, dental-only, or vision-only insurance policies.



10127.16.  (a) After the termination of the pilot program under
Section 10127.15, a health insurer shall continue to provide coverage
under the same terms and conditions specified in Section 10127.15 as
it existed on January 1, 2006, including the terms of the standard
benefit plan and the subscriber payment amount, to each individual
who was terminated from the program, pursuant to subdivision (f) of
Section 12725 of the Insurance Code during the term of the pilot
program and who enrolled or applied to enroll in a standard benefit
plan within 63 days of termination.  The Managed Risk Medical
Insurance Board shall continue to pay the amount described in Section
10127.15 for each of those individuals.  A health insurer shall not
be required to offer the coverage described in Section 10127.15 after
the termination of the pilot program to individuals not already
enrolled in the program.
   (b) If the state fails to expend, pursuant to this section,
sufficient funds for the state's contribution amount to any health
insurer, the health insurer may increase the monthly payments that
its subscribers are required to pay for any standard benefit plan to
the amount that the Managed Risk Medical Insurance Board would charge
without a state subsidy for the same insurance product issued to the
same individual within the program.



10127.17.  (a) The Life and Annuity Consumer Protection Fund is
hereby created as a special account within the Insurance Fund. Each
insurer admitted to transact insurance in this state shall pay a fee
to be determined by the commissioner, not to exceed one dollar (),
for each individual life insurance policy and each individual annuity
product that it issues to a resident of this state with a value of
fifteen thousand dollars (,000) or more.  If an insurer elects to
charge the purchaser of a life insurance policy or annuity product
this fee, the fee shall be set forth as a separate charge in the
contract schedule or premium notice.  Life insurance or annuity forms
are not required to be filed again for review as a consequence of
this provision.  This fee shall be assessed on all new individual
life insurance policies and annuity products issued during the prior
12 months, and shall be deposited into the Life and Annuity Consumer
Protection Fund.
   (b) Moneys in the Life and Annuity Consumer Protection Fund shall
be distributed by the commissioner and shall be exclusively dedicated
to protecting consumers of life insurance and annuity products in
this state.  Moneys in the fund shall not be used for any other
purpose.
   (c) Fifty percent of these funds shall be distributed within the
department for consumer protection functions related to individual
life insurance and annuity products, including, but not limited to:
   (1) Investigating and prosecuting financial abuse by insurance
licensees, or persons holding themselves out to be insurance
licensees, or any person purporting to be engaged in the business of
insurance.
   (2) Responding to consumer inquiries and complaints related to
life insurance or annuity products.
   (3) Educating consumers in all aspects of life insurance and
annuity products, consumer protection, purchasing and using insurance
and annuity products, claim filing, benefit delivery, and dispute
resolution.
   (4) Regulating and overseeing life insurance and annuity products
and advertising for these products directed toward consumers.
   (d) Fifty percent of the funds shall be distributed to district
attorneys for investigating and prosecuting  individual life
insurance and annuity product financial abuse cases involving
insurance licensees, or persons holding themselves out to be
insurance licensees, or any person purporting to be engaged in the
business of insurance, and for other projects beneficial to insurance
consumers.
   (1) The commissioner shall distribute funds to district attorneys
who are able to show a likely positive outcome that will benefit
consumers in the local jurisdiction based on specific criteria
promulgated by the commissioner.  Each local district attorney
desiring a portion of those funds shall submit to the commissioner an
application, including, at a minimum:
   (A) The proposed use of the moneys and the anticipated outcome.
   (B) A list of all prior relevant cases or projects and a copy of
the final accounting for each.  If cases or projects are ongoing, the
most recent accounting shall be provided.
   (C) A detailed budget, including salaries, and general expenses,
and specifically identifying the cost of purchase or rental of
equipment or supplies.
   (2) Each district attorney that receives funds pursuant to this
section shall submit a final detailed accounting at the conclusion or
closure of each case or project.  For cases or projects that
continue longer than six months, interim accountings shall be
submitted every six months, or as otherwise directed by the
commissioner.
   (3) Each district attorney that receives funds pursuant to this
section shall submit a final report to the commissioner, that may be
made public, as to the success of the case or project conducted.  The
report shall provide information and statistics on the number of
active investigations, arrests, indictments, and convictions.  The
applications for moneys, the distribution of moneys, and the annual
reports shall be public documents.
   (4) Notwithstanding any other provision of this section,
information submitted to the commissioner pursuant to this section
concerning criminal investigations, whether active or inactive, shall
be confidential.
   (5) The commissioner may conduct a fiscal audit of the programs
administered under this subdivision.  This fiscal audit shall be
conducted by an internal audit unit of the department.  The cost of
any fiscal audits shall be paid for from the  Life and Annuity
Consumer Protection Fund established by this section.
   (6) If the commissioner determines that a district attorney is
unable or unwilling to investigate or prosecute a relevant financial
abuse case, the commissioner may discontinue distribution of funds
allocated for that matter and may redistribute those funds to other
eligible district attorneys.
   (e) The funds received under this section shall be deposited in
the Life and Annuity Consumer Protection Fund within the Insurance
Fund, and shall be expended and distributed as appropriated by the
Legislature for the purposes of this section.  The total amount
contained in the Life and Annuity Consumer Protection Fund shall not
exceed five million dollars (,000,000) annually.  If, as of June 30
of any calendar year, the moneys in the fund exceed this amount, the
commissioner shall adjust the amount of the assessment for the
following year.  An insurer, upon receipt of an invoice, shall
transmit payment to the department for deposit in the Life and
Annuity Consumer Protection Fund.  Any balance remaining in the Life
and Annuity Consumer Protection Fund at the end of the fiscal year
shall be retained in the account and carried forward to the next
fiscal year.
   (f) The commissioner may develop guidelines for implementing or
clarifying these provisions, including guidelines for the allocation,
distribution, and potential return of unused funds.  The
commissioner may, from time to time, issue regulations for
implementing or clarifying these provisions.
   (g) This section shall remain in effect only until January 1,
2010, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2010, deletes or extends
that date.


10127.18.  (a) On and after January 1, 2005, a health insurer
issuing individual policies of health insurance that ceases to offer
individual coverage in this state shall offer coverage to the
policyholders who had been covered by those policies at the time of
withdrawal under the same terms and conditions as provided in
paragraph (3) of subdivision (a), paragraphs (2) to (4), inclusive,
of subdivision (b), subdivisions (c) to (e), inclusive, and
subdivision (h) of Section 12682.1.
   (b) The department may adopt regulations to implement this
section.
   (c) This section shall not apply when a plan participating in
Medi-Cal, Healthy Families, Access for Infants and Mothers, or any
other contract between the plan and a government entity no longer
contracts with the government entity to provide health coverage in
the state, or a specified area of the state, nor shall this section
apply when a plan ceases entirely to market, offer, and issue any and
all forms of coverage in any part of this state after the effective
date of this section.