Signed by Governor Gavin Newsom

Vote Smart's Synopsis:

Vote to pass with amendment a bill that amends financial data disclosure laws relating to individual hospital profits.

Highlights:

• Requires health care service plans to file with the department all required rate information for small group and grandfathered individual health care service plan contracts at minimum 120 days before making a rate change (Sec. 1).

• Establishes separate deadlines for filing the required rate information for nongrandfathered individual health care service plan contracts specified in sub-section 1385.03 (Sec. 1).

• Requires health care service plans, for large group health care service plan contracts, to file with the department the weighted average rate increase for every large group benefit design during the year long period ending January 1 of the following calendar year (Sec. 2).

• Requires annual meetings concerning large group rates, within 4 months of posting aggregate information, to take place so that a public discussion can be held focusing on the reasons for changes in the rates, benefits, and cost sharing in the large group market (Sec. 2).

• Requires a health care service plan to, at a minimum, make the following information readily available to the public on their websites in plain language, and must include the following information (Sec. 3):

• Justifications for any unreasonable rate increases, including all information supporting documentation as to why the rate increase is justified;

• A plan’s overall medical trend factor assumptions in each rate filing for all benefits;

• A health care service’s plan’s actual costs, by aggregate benefit category to include hospital inpatient, hospital outpatient, physician services, prescription drugs and other services, laboratory, and radiology; and 

• The amount of the projected trend attributable to the use of services, price inflation, or fees and risk for annual plan contract trends by aggregate benefit category, such as hospital inpatient, hospital outpatient, physician services, prescription drugs and other services, laboratory, and radiology. 

• Requires an organization that operates, conducts, owns, or maintains a health facility to make and file with the Office of Statewide Health Planning and Development (OSHPD) all of the following reports (Sec. 4):

• A balance sheet detailing the assets, liabilities, and net worth of the health facility at the end of its fiscal year;

• A statement of income, expenses, and operating surplus or deficit for the annual fiscal period, and a statement of ancillary utilization and patient census;

• A statement detailing patient revenue by payer, including but not limited to, Medicare, Medi-Cal, and other payers, and revenue center;

• A statement of cash flows, including but not limited to, ongoing and new capital expenditures and depreciation; and 

• A statement reporting the information for each separately licensed health facility operated, conducted, or maintained by the reporting information.

• Requires health insurers, for large group health insurance policies, to file with the department the weighted average rate increase for every large group benefit design during the year long period ending January 1 of the following calendar year (Sec. 7).

• Specifies that reimbursements for this act are not required (Sec. 8). 

Full Bill Text