Health care coverage: continuation coverage.

Existing law provides for licensing and regulation of health care service plans by the Department of Managed Health Care. Existing law provides for licensing and regulation of health insurers by the Insurance Commissioner. A willful violation of provisions governing health care service plans is a crime. Existing law requires health care service plans and health insurers to offer continuation of group coverage for a specified period of time to persons who become ineligible for the group coverage, otherwise known as COBRA or Cal-COBRA. Existing law allows persons qualifying as "federally eligible defined individuals" for purposes of the federal Health Insurance Portability and Accountability Act of 1996 (HIPAA) to enroll in individual health care coverage offered by plans and insurers without preexisting condition exclusions, providing they meet certain requirements, including the election and exhaustion of COBRA or Cal-COBRA coverage available to them. This bill would delete the requirement that a person must elect and exhaust COBRA or Cal-COBRA coverage in order to qualify for access to individual health care coverage as a federally eligible defined individual under HIPAA. By modifying the requirements applicable to health care service plans, the bill would change the definition of a crime and would thereby impose a state-mandated local program. 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.