Bill > SB363

This bill requires health care service plans and health insurers to provide detailed annual reports to their respective departments about treatment denials and modifications, starting June 1, 2026. These reports must break down denials by type of care (such as surgical/medical or behavioral), diagnosis category, age, and other demographic factors, and include specific reasons for denials like medical necessity, investigative procedures, or billing issues. The departments will then compare the number of treatment denials to the number of successful independent medical review overturns or reversals. For health care providers with 10 or more independent medical reviews in a year, if more than 50% of their reviews result in overturning a treatment denial in any category, they will be subject to administrative penalties. The first violation incurs a $25,000 penalty, the second violation ranges from $50,000 to $200,000, and subsequent violations carry a $500,000 penalty. The bill also creates new administrative penalty funds to collect these fines, with the money to be used to offset implementation costs and other specified purposes. The penalty amounts will be adjusted every five years to reflect changes in the medical care Consumer Price Index. Penalties are not exclusive and can be combined with other civil, criminal, and administrative remedies.

Budget and Finance, Health and Social Services

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260SB363