California Health Benefit Exchange.

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 the California Health Benefit Exchange (Exchange) to facilitate the purchase of qualified health plans by qualified individuals and qualified small employers by January 1, 2014. Existing law prohibits certain unfair insurance practices specifically and unfair business practices in general. This bill would prohibit an individual or entity from holding himself, herself, or itself out as representing, constituting, or otherwise providing services on behalf of the Exchange unless that individual or entity has a valid agreement with the Exchange to engage in those activities. The bill would specify that it is an unfair business practice for health care service plans, entities engaged in the solicitation of health care service plan contracts, and persons engaged in the business of insurance to violate this provision. Because a willful violation of the provisions governing health care service plans is a crime, the bill would 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.