Bill > SB363

This bill requires health care service plans and health insurers to provide detailed annual reports to their respective state departments (Department of Managed Health Care and Department of Insurance) about their treatment denials and modifications. The reports must break down denials by type of care (surgical, medical, behavioral, pharmaceutical), age groups, available demographic data, and reasons for denial (such as medical necessity or insufficient information). If more than 50% of independent medical reviews in any care category result in overturning or reversing a treatment denial, the health plan or insurer will be subject to administrative penalties ranging from $25,000 for a first violation to $500,000 for subsequent violations. The bill creates special funds (the Managed Care Independent Medical Review Administrative Penalties Subaccount and the Health Insurance Independent Medical Review Administrative Penalties Fund) to collect these penalties, which can be used to offset implementation costs and other administrative expenses. The departments are also required to analyze and publish data about these denials and independent medical review outcomes annually, providing transparency into healthcare coverage decisions. Starting in 2026, health plans and insurers must submit these comprehensive reports, which will help regulators monitor and potentially reduce improper treatment denials.

Budget and Finance, Health and Social Services

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