SPECIAL LEGISLATIVE UPDATE

TWO BILLS TO WATCH

As a follow-up to Friday’s Weekly Bulletin, here’s a bit more detail about the recent activity at the CA Capitol that we shared.

Yes, much hype surrounds SB 1446 (Grandmothering Bill) and SB 1034 (waiting period fall back to federal rules).  The question on most agents’ minds has been: when are they going to pass?

The news from the legislature is that they will hit Governor Brown’s desk by early July.  Most bills, once signed, become effective the first of the following year, which, in this case, would be 1/1/2015.  However, we are pleased to let you know that both of these bills have an “Urgency Clause” attached to them.  What does that mean?  This means that, if signed by the governor, they will go into effect immediately.

So… does this mean that all carriers will immediately jump on the bandwagon and maintain their old plans (renewing this fall) and expand waiting periods to first of the month following 60 days (or 90 days exactly)?  That is an excellent question, but the answer can differ depending upon the carrier.

During the CAHU Capitol Summit in May, there was an executive panel with representation from Aetna, Anthem Blue Cross Blue Shield, Health Net, Kaiser,SeeChange and United Healthcare.  Most indicated that they would allow for “Grandmothering”, but didn’t give exact effective dates, should the bill pass.  Since SB 1446 only allows for a one year extension (though 12/31/2015), the most important date for small groups is going to be the dreaded 12/1.  With most carriers (in small group) finding the majority of their plans renewing the last quarter of the year, it is very likely that you’ll find them cooperate on extending plans.  Keep in mind that the “Grandmothered” renewing plans will have new rates and, possibly, new RAFs.

We’ve started seeing some preliminary notices from carriers on this subject. Expect to see more emails from them as they develop their response to each of the bills, should they be signed the governor.

More to come, so stay tuned…

Chris Bender

 

Chris Bender

SAHU Legislative Chair

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