California Health and Safety Code 1367.045 – (a) If a health care service plan contract offered, issued, …
(a) If a health care service plan contract offered, issued, delivered, amended, or renewed on or after January 1, 2021, contains a provision that reserves discretionary authority to the plan, or an agent of the plan, to determine eligibility for benefits or coverage, to interpret the terms of the contract, or to provide standards of interpretation or review that are inconsistent with the laws of this state, that provision is void and unenforceable.
(b) For purposes of this section, the term “discretionary authority” means a contract provision that has the effect of conferring discretion on a health care service plan or other claims administrator to determine entitlement to benefits or interpret contract language that, in turn, could lead to a deferential standard of review by a reviewing court.
Terms Used In California Health and Safety Code 1367.045
- Contract: A legal written agreement that becomes binding when signed.
- Enrollee: means a person who is enrolled in a plan and who is a recipient of services from the plan. See California Health and Safety Code 1345
- Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
- plan: refers to health care service plans and specialized health care service plans. See California Health and Safety Code 1345
- State: means the State of California, unless applied to the different parts of the United States. See California Health and Safety Code 23
(c) This section does not prohibit a health care service plan from including a provision in a contract that informs an enrollee that, as part of its routine operations, the plan applies the terms of its contracts for making decisions, including making determinations regarding eligibility, receipt of benefits and claims, or explaining policies, procedures, and processes, so long as the provision could not give rise to a deferential standard of review by a reviewing court.
(d) This section applies to both group and individual health care service plan contracts.
(Added by Stats. 2020, Ch. 151, Sec. 2. (SB 855) Effective January 1, 2021.)