AB 2042 Summary

• Health care service plans and health insurers are prohibited from altering rates or benefits in individual contracts/policies more than once per calendar year, effective January 1, 2011

• Exceptions allow rate changes when enrollees change geographic region or family composition, when provider rates change (for percentage-based coinsurance), and when generic drug alternatives become available

• Health insurers may lower premiums without altering cost-sharing or benefits, and plans may provide coverage for newly approved treatments and therapies without triggering the once-per-year limit

• New individual contracts or policies may only be issued annually, and the restrictions do not apply to publicly-funded programs (Medi-Cal, Healthy Families) or Medicare supplement coverage

• Willful violations by health care service plans constitute a crime under existing law; no state reimbursement required for local agency or school district costs