Garner Insurance Services Bulletin
January, 2010

The following is a brief summary of some of the new laws affecting life, health and disability insurance in California. Unless otherwise noted, the bills described here apply to contracts issued, amended, delivered or renewed on or after January 1, 2010. Cal-COBRA Premium Assistance AB 23 amends California's health benefits continuation coverage laws ("Cal-COBRA") to conform to the premium subsidy provisions in the American Recovery and Reinvestment Act of 2009 ("ARRA"). AB 23 took effect immediately on May 12, 2009. After the legislature adjourned, Congress extended the subsidy, so California law no longer conforms to federal law. Health Care Coverage Pricing Existing law prohibits health care service plans and life and disability insurers from having premium differentials because of sex, but makes an exception for differentials based on specified statistical and actuarial data. AB 119 eliminates that exception for contracts issued, amended, or renewed effective January 1, 2011. Dependent Children SB 1168 provides that if an HMO or insurance policy provides coverage for a dependent child who is over 18 years of age and enrolled full-time at a secondary or post-secondary educational institution, that coverage shall not terminate, for a period not to exceed 12 months or until the date on which the coverage is scheduled to terminate pursuant to the terms and conditions of the policy, whichever comes first, if the dependent child takes a medical leave of absence from school. Certification of the need for the leave must be provided within specified time periods. Electronic Transactions AB 328 has several parts to, all intended to allow certain transactions to be conducted electronically, including insurance transactions. Health Information Disclosure for Taft-Hartley Plans AB 952 authorizes a health care provider or a health care service plan to disclose medical information to an employee welfare benefit plan formed under the Taft-Hartley Act, or to an entity contracting with that employee welfare benefit plan if, among other requirements, the disclosure is for a specified purpose (such as determining eligibility, coordinating benefits, or advocating on behalf of the participant), is made pursuant to a request accompanied by a written authorization for the release of the information, and is authorized by and made in a manner consistent with HIPAA. The disclosure must be for billing, claims management, medical data processing, or other administrative services related to the provision of medical care. This bill amends the Confidentiality of Medical Information Act, which applies to health care service plans and providers; interestingly, it does not amend the Insurance Information and Privacy Protection Act, which applies to insurers. Out-of-State Same-Sex Marriages SB 54 is intended to address how California should treat same-sex marriages entered outside of this state. SB 54 provides that, notwithstanding any other provision of law, a marriage between two persons of the same sex contracted outside this state that would be valid by the laws of the jurisdiction in which the marriage was contracted is valid in this state if the marriage was contracted prior to November 5, 2008. SB 54 specifies that, notwithstanding any other provision of law, two persons of the same sex who contracted a marriage on or after November 5, 2008, that would be valid by the laws of the jurisdiction in which the marriage was contracted shall have the same rights, protections, and benefits, and shall be subject to the same responsibilities, obligations, and duties under law, as specified, as are granted to and imposed upon spouses with the sole exception of the designation of "marriage." Mental Health Services SB 296 requires, on and after July 1, 2011, every health care service plan, including a specialized health care service plan, and health insurer that provides professional mental health services to issue an identification card to each enrollee. The bill requires the identification card to be issued upon enrollment or commencement of coverage or upon any change in the enrollee's coverage that impacts the data content or format of the card. Reconstructive Surgery Existing law requires health care service plan contracts and health insurance policies to cover reconstructive surgery. SB 630 defines reconstructive surgery, as of July 1, 2010, to include medically necessary dental or orthodontic services that are an integral part of reconstructive surgery for cleft palate procedures. *  *  *  *  * Please remember that Federal law may preempt some of these bills to the extent they attempt to regulate self-funded employee benefit plans. Garner Insurance Services does not practice law. Please seek qualified counsel if you need legal advice. For group insurance brokerage services, please call Zaven Kazazian or Andy Keowen at (626) 351-2300. Visit us on the web at http://www.garnerbenefits.com.