AB 156: Individual market: enrollment periods.

(1)Existing federal law, the Patient Protection and Affordable Care Act (PPACA), effective June 19, 2017, requires an American Health Benefit Exchange that facilitates the purchase of qualified health plans by qualified individuals and qualified small employers to provide for the individual market an annual open enrollment period for policy years beginning on or after January 1, 2018, to begin on November 1 and extend through December 15 of the calendar year preceding the benefit year. Existing federal law establishes special enrollment periods during which a qualified individual may enroll in a qualified health plan when specified triggering events occur, such as when the qualified individual losses minimum essential coverage, as defined. Existing federal regulatory authority authorizes a state to establish additional special enrollment periods to supplement these special enrollment periods provided for under federal law under certain circumstances.

Existing law establishes the California Health Benefit Exchange within state government for the purpose of facilitating the purchase of qualified health plans through the Exchange by qualified individuals and qualified small employers.

Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law also provides for the regulation of health insurers by the Department of Insurance. Existing law requires a health care service plan and health insurer, on and after October 1, 2013, to offer, market, and sell all of the plans or health insurers health benefit plans that are sold in the individual market for policy years on or after January 1, 2014, to all individuals and dependents in each service area in which the plan or insurer provides or arranges for the provision of health care services, as specified, but requires plans and insurers to limit enrollment in individual health benefit plans offered both through and outside of the Exchange to specified open enrollment and special enrollment periods. Existing law requires a plan and health insurer to provide an annual enrollment period for policy years beginning on or after January 1, 2016, from November 1, of the preceding calendar year, to January 31 of the benefit year, inclusive. Existing law requires a plan and health insurer, annually on or before October 1, to issue a notice to a subscriber and policyholder, as applicable, enrolled in any individual health benefit plan offered outside of the Exchange, and requires this notice to inform the subscriber and policyholder of, among other things, the applicable open enrollment period provided through the Exchange.

This bill would instead require, with respect to individual health benefit plans offered outside of the Exchange, that the annual open enrollment period for policy years beginning on or after January 1, 2019, extend from October 15 of the preceding calendar year, to January 15 of the benefit year, inclusive. The bill would instead require, with respect to individual health benefit plans offered through the Exchange, that the annual open enrollment period for policy years beginning on or after January 1, 2019, extend from November 1 to December 15 of the preceding calendar year, inclusive. The bill would require a health care service plan and a health insurer, with respect to individual health benefit plans offered through the Exchange, for policy years beginning on or after January 1, 2019, to provide a special enrollment period that will allow individuals to enroll in individual health benefit plans through the Exchange from October 15 to October 31 of the preceding calendar year, inclusive, and from December 16, of the preceding calendar year, to January 15 of the benefit year, inclusive, and would require an application for a health benefit plan submitted during this special enrollment period to be treated the same as an application submitted during the annual open enrollment period. The bill would require a plan and health insurer to also include in the annual notice described above information regarding the applicable special enrollment periods. The bill would make conforming changes.

Because a willful violation of that requirement by a health care service plan would be a crime, this bill would impose a state-mandated local program.

(2)The PPACA creates various premium stabilization programs, such as the transitional reinsurance program and the risk adjustment program, to stabilize premiums in the individual market inside and outside of the Exchanges. Under the transitional reinsurance program, contributions are collected from contributing entities to fund reinsurance payments to issuers of nongrandfathered reinsurance-eligible individual market plans and the administrative costs of operating the reinsurance program for the 2014, 2015, and 2016 benefit years.

Existing law requires a health care service plan and health insurer to consider the claims experience of all enrollees and all insureds in all nongrandfathered individual health benefit plans offered by that plan or insurer in this state as a single risk pool for rating purposes in the individual market and to consider the claims experience of all enrollees and all insureds in all nongrandfathered small group market plans offered by that plan or insurer in this state as a single risk pool for rating purposes in the small market. Existing law requires a plan and health insurer to establish, each calendar year, an index rate for those markets in the state based on the total combined claims costs for providing essential health benefits, as defined, within the single risk pool and requires the index rate to be adjusted on a marketwide basis based on the total expected marketwide payments and charges under the risk adjustment and reinsurance programs established for the state under the federal provisions described above and the Exchange user fees. Existing law requires the premium rate for all of the individual health benefit plans and small employer health benefit plans within the single risk pool to use the applicable marketwide adjusted index rate, as specified.

This bill would delete the reference to the federal transitional reinsurance program in these provisions.

(3)The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.